Lower time frame trading is often known as scalping. Scalping allows you to make a profit within a short period. But the associated risk in this strategy is extremely high and for this reason, the pro-Aussie traders suggest that new trader’s trade using the position trading method. Though scalping is designed for experienced traders there are some tricks which you can follow to make huge profits from this market. Read this article with extreme care since this might change your life. If you become confused about any section of this article, read it again and you will understand the gist. Let’s learn some amazing techniques which will help you to scalp the market like a pro trader.
100 day SMA
The 100 day SMA acts dynamic support and resistance level. Those who have extensive experience with simple moving average knows the perfect way to use the 100 days SMA. But those who are new to this profession have nothing to worry about. We will make things clear. Most of the time, the price respects the 100 days SMA and allows the traders to make a decent profit. Let’s assume the price of a certain asset is trading above 100 days SMA. To scalp the market, you set pending buy orders right at the 100 days SMA with a 10 pips stop. The take profit level should be set to 20+ pips. Most of the time, you will be able to make a decent profit by using this amazing scalping method. But make sure you are not trading the market based on this strategy during the major news release.
Trade the key retracement level
The pro traders in the options trading industry often use the Fibonacci retracement tools to find great trades. Instead of scalping all the retracement levels, you need to scalp the 50% and 61.8% retracement level. Most of the time the price bounce off after hitting the 50% or 61.8% retracement level. By setting pending orders at those levels, you can easily make 20- 30 pips profit with a very low. The new traders often get carried away with emotions by seeing the success rate of a Fibonacci scalping strategy. No trading system in the world is perfect. You must trade the market with a 1% risk when you intend to make a profit as a scalper. So, consider the role of money management while placing any major trade.
Never overtrade the market
Most of the scalpers blow up the trading account since they overtrade. If you want to become a professional scalper you must learn to trade the market with proper discipline. Never think you can make a big profit from this market without learning the basics of this market. Once you have the proper skills, focus on quality trade execution. Being a scalper, you will have many trade setups but still, you can’t afford to place more than 2 trades in a single trading session. Never overtrade the market since it will cost you money.
Trade with discipline
The professional scalpers are very disciplined. They never break any rules associated with their trading strategy. The novice traders find it hard to embrace the losing orders and they break the rules. Eventually, they lose their entire investment. If you want to make a profit as a professional scalper you must learn to trade with proper discipline. Start using a professional trading journal so that you can write the details of each trade. During the spare time, analyze the losing trades and try to find the faults associated with the trading system. Once you find the mistakes, find solutions to make trading easier. If required, accept help from the professional traders. Trading is all about discipline. When you intend to become a scalper, you can’t afford to trade the market with emotions. So, take things very seriously before executing a trade.