Scalping is one of the fastest and most dynamic trading strategies in the market. If you enjoy being constantly on the move, making quick decisions, and catching small but frequent profits, this strategy might be for you.
What is scalping?
Scalping is trading on short timeframes (from a few seconds to a couple of minutes), where the goal is to profit from the slightest price changes. For example, buy cryptocurrency for $10,200, sell for $10,205. The profit seems tiny, but throughout the day, there can be dozens or even hundreds of such trades, which collectively yield significant income.
Principles of scalping
🔖Speed is the most important.
Scalping requires quick decision-making. Prices can change in seconds, and you need to react swiftly.
🔖Small but frequent profit.
Scalpers do not wait for huge market movements. Their goal is to secure small profits from each trade.
🔖Risk under control.
It is important to establish in advance how much you are willing to lose in case of failure. Typically, scalpers use stop-losses to minimize losses.
🔎How scalping works: step by step
📌Choice of instrument
For scalping, cryptocurrencies with high liquidity and trading volumes are best suited, for example:
✔️Bitcoin (BTC).
✔️Ethereum (ETH).
✔️USDT pairs.
📌 Timeframes
Scalping is usually done on the shortest timeframes:
1 minute (M1).
5 minutes (M5).
15 minutes (M15).
📌Trading strategy
There are many approaches to scalping, let's discuss the most popular ones in my opinion 🤔
🔴 Trend trading.
Open trades only in the direction of the main trend (up or down) to minimize risk. For example, if the price is rising, buy on a pullback to sell at a new peak.
🟣 Trading on breakouts.
Look for moments when the price exits the corridor or breaks key levels. This is often followed by rapid movements that scalpers use for profit.
🔵 Intraday range.
The price often fluctuates within a certain range. Scalpers buy at the lower boundary and sell at the upper boundary.
📌What you need for successful scalping
✔️Platform with a fast response.
The faster you can open and close trades, the better.
✔️Technical analysis.
Scalping is working with charts. Main tools:
Support and resistance levels.
Moving Averages.
RSI, MACD, and other indicators.
📌Discipline and emotional control.
In scalping, mistakes happen, but it is important not to give in to emotions and not to try to recover losses.
📌❗️Good internet.
A stable connection is everything. Any delay can cost money.
❗️Pros and cons of scalping❗️
Pros:
- Quick profits.
- Minimal dependence on global news or long-term trends.
- Many opportunities every day.
Cons:
- High level of stress.
- Requires constant attention and time.
- Risks of losses due to mistakes or sharp market movements.
🔖Recommendation from me🤔🤔🤔
❗️Start small. (I always write about this in all articles).
❗️Limit risks: never invest more than 1-2% of your deposit in a single trade.
❗️Use trading bots or scripts to automate routine actions.
❗️Don't forget about commissions: calculate them before each trade.
Scalping is an intensive but interesting way to trade. If you enjoy making quick decisions and working with charts, it can become your favorite tool. The main thing is to act thoughtfully and not forget about risk management.
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