Scalping in Forex: Small Steps to Profitable Trading Strategies

Forex scalping is a trading strategy defined by a trader that opens and closes an order within minutes in order to profit from small price appreciations when market moves are favourable.

A scalping trader is alerted to these market movements and enters and exits market orders at the right moments. Regardless of the market direction, the currency pair is open to advances, pullbacks and further advance. During these times, the markets are affected by major movements and minor price movements on the MT4 charts. A currency pair may move 100 pips over several hours, a pullback 70 pips over the following hours. Sometimes, the market can advance a further 200 pips. These major moves are suitable for trend traders or medium term traders, but not scalping traders.

Scalpers and scalping robots are more focused on trading where the market moves 15 pips in minutes. If the market oscillates over a few minutes, then it’s ideal conditions for scalping. The scalper makes the right decision based on forex indicators to enter and exit the market and makes scalping profits.

The time frame scalpers focus on is 1 minute, 5 minutes and 15 minutes as the scalping strategy is to enter and exit with profit in minutes using technical analysis and not risking trading for longer.

What are the positives & negatives of Forex scalping?

What are Forex Scalping Benefits?

The main benefit is to make money scalping quickly, entering many successful forex orders. Scalping systems that trade 1 standard lot (round turn) 20 times a day, and target a 3 pip profit on each can generate $600 daily scalping profit. The target is to close profits within minutes and not to expose forex orders to unknown market conditions that ruin the trading strategy. Knowing when to close forex trades is just as important as when to open and this can be judged by using some of the best forex indicators. Risk management is also more controlled in scalping.

What are Forex Scalping Negatives?

Scalping is suitable for experienced forex traders, new comers to forex can find it complicated or risky. New traders often don’t understand fully chart action, news, indicators and technical analysis that are crucial to a successful scalping strategy. As scalping depends on market noise, news releases and breakouts, it can be difficult for a beginner to really understand the impact on fx markets.

Many brokers view scalping as negative, it is critical to check the brokers scalping policy. If the broker is not transparent on the site, then you should be altered, ask support specific questions to ensure your profitable scalping system will be accepted.

As Scalping is very sensitive to market noise and short-term market conditions, traders should avoid trading during news releases and unstable fx markets that can lead to sudden changes in direction.

To read more about scalping, scalping strategies and how to make money scalping, please visit our series of Scalping Forex Articles.

Yadix Managed Forex Accounts - Manager Update 12427

Each week, we would like to highlight one forex manager, the trading performance and the trading profit that is generated from asset managers in the Yadix PAMM community.

This week, the spotlight falls on manager 12427 who is the forex manager for many accounts and is managing tens of thousands of Dollars for forex investors. 

This article will cover the period of the last fortnight to give readers a better understanding of real time performance.

Since the week commencing 21/01/2013, the forex account manager has generated a profit of $1536.04, a growth of over 10% for each forex investor. See Image below:

Trading is performed by a forex robot that operates under a very successful trading strategy and under the constant supervision of the manager himself. Not only are the results very impressive, we can see from the report that there is very little risk as maximum drawdown is only 5.75%. Furthermore, the asset manager has a very low performance fee of 20% based on high watermarks.

You too can now participate in the Yadix Pamm programme and benefit from diversifying your investments by using multiple manual and automatic trading strategies, such as successful scalping systems, trend and breakout strategies.

Forex Scalping Education

Yadix is happy to share with readers’ six new articles that have been independently written to help clients understand more about scalping forex markets, the benefits of scalping and many critical elements that will affect your choices when developing or when you learn how to scalp the forex markets.

Each article covers a different, but important part of the scalping strategy, starting with how to scalp the fore market and finishing with how to make money scalping. Below you will find a brief overview of each scalping education article and a link to read more:

Forex Scalping Article No1: How to Scalp the Forex Markets

Start your forex scalping education with reading more about how to scalp forex markets. This article will cover whether forex scalping is right for you, the benefits of scalping, choosing a broker for scalping and an introduction into scalping robots.

How to Scalp the Forex Markets

Forex Scalping Article No2: Forex Scalping Factors

 In our second article, we look at the most important factors of scalping the markets. The importance of low spreads, the forex brokers scalping policy and other order execution elements such as re-quotes, slippage, news trading and fast order execution.

Forex Scalping Factors

Forex Scalping Article No3: Forex Scalping Strategies

This article covers what you should know as a forex scalper, what a scalper looks for in a forex broker and how different forex models employed by brokers can dramatically affect your forex scalping system.

Forex Scalping Strategies

Forex Scalping Article No 4: Technical Analysis Scalping Systems

Technical Analysis is an important part of any Scalping System. In this introduction we look at the critical impact technical analysis can have on profitable forex trading systems. News Breakouts, technical breakouts, range patterns and flags are covered in depth.

Technical Analysis Scalping Systems

Forex Scalping Article No 5: Automated Forex Scalping Systems & Forex Robots

Automated trading systems, forex robots and EAs are growing in popularity in recent years as they give forex traders freedom and proven trading systems to trade and make money in forex markets. This article is in place to educate traders what to look for in a forex robot as well as discussed the best forex indicators that many Expert Adviors use.

Automated Forex Scalping Systems & Forex Robots

Forex Scalping Article No 6: Make Money by Forex Scalping

The final piece of the series of scalping education focuses on how to make money trading scalping forex and some important factors that all traders should consider.

Make Money by Forex Scalping

For specialist advice or information on scalping forex, please feel free to contact our support team. Details can be found at www.Yadix.com

Yadix Execution Speed

One of the major benefits of trading forex with Yadix is the execution speed that our forex trading community enjoys using the Yadix MT4 and mobile trading platforms.

Using cutting-edge technology, trading servers located around the world and a leading forex bridge ensures that Yadix delivers lightening fast order execution, with minimal latency and stable order filling to all of its forex trading clients.

Speed of forex execution is a crucial part of ant forex trading strategy to ensure that traders can open orders at desired price levels and close efficiently and quickly at the required profit or loss. The same logic is a necessity for stop loss, take profit and pending orders also.  

All of these forex trading factors are essential in risk and reward management. Without fast and efficient order execution, there is a likelihood of lost pips due to delayed order execution through latency, poor technology and human delays.

On average, forex orders at Yadix are executed in under 3.5 milliseconds, and when using the Yadix VPS, this is further reduced to under 1 millisecond on average.  The Yadix VPS is a facility that is free to Yadix clients that fund their forex trading accounts with $5,000 or more and is proved to enhance not only the execution speed but also to host EAs and allow them to trade 24 hours per day.

Further to the fast and superior order execution offered, Yadix forex broker also offers no trading restrictions or stop levels on all currency pairs. This includes no stop loss, take profit, pending orders or trailing stop levels, giving our clients the freedom to trade and maximise the profit levels.

To find out more about how Yadix can help you generate maximum pips and improve your trading strategy, please feel free to visit the website or feel free to chat with one of our professional and qualified support staff.

Scalping with Yadix

Yadix provides a stable, reliable and beneficial forex trading environment for all forex traders, however, forex market scalpers truly understand the benefits and value that trading with Yadix delivers. This is the reason that Yadix has seen a dramatic growth in scalping forex traders recently.

Whilst many brokers promote the fact that scalping is allowed, the truth is that a real scalping forex traders will understand that the majority of forex brokers have certain limitations in place that means true scalping cannot be performed at these forex brokers and more importantly, effecting profitability or encouraging losses.

Some of these restrictions include minimum time limits that any specific order must remain open. Many forex brokers implement rules that ensure that orders must remain open for anything from two, three, five or even as much as 10 minutes. Many traders do not understand the reasoning behind these restrictions, which are basically, the longer that a trade remains open in a volatile forex market, the higher the likelihood that the client will generate losses. This is beneficial for market making brokers.

The same logic is applied to pip restrictions. Most brokers in the competitive for market place implement a minimum pip restriction (usually 5 pips, but dependent on the pair) between the open price and the price that they allow the position to be closed at. This is also applicable to pending orders, for example, a pending order can be placed a minimum 5 pips away from the current trading price of the forex currency pair.

Stop loss and take profit are a critical part of any forex trading risk and reward strategy, however, with pips level restrictions, closing a profit on your forex orders, or controlling loss on your forex position is limited as a scalper.

The logic behind scalping is to enter and exit the market to make the most of short term forex price movements and to avoid long term trades in a volatile forex market place. With pip and time levels restrict trading and lessen potential profits as part of a strategy by the market making broker.

Brokers that benefit from these limitations are those operating dealing desks and market making activities. Limits are in place to increase profitability for the broker or to limit the profitability of this forex scalping strategy, especially for clients trading with automated trading tools (forex robots or EAs).

Yadix is proud to offer its clients trading withoutrestriction, including zero pips levels on stop loss, take profit, pending orders and on all other trading. There are also no time limits in place at Yadix, meaning that clients trading forex scalping strategies have the freedom to maximise the profits and trade without any limitations whatsoever.

Yadix is totally unique in this sense as a true STP/ECNbroker. We are proud to be able to offer our clients the forex trading environment without restrictions and the ability to trade the way they want.

Yadix Forex PAMM Update

The launch of the Yadix PAMM forex investors and managers community in December 2012 has proven to have delivered popularity with clients, investors and managers at Yadix.

By offering an unrestricted trading environment for forex traders, Yadix is able to attract a vast range of Forex Account Managers who are able to trade forex using their profitable strategies, whether aggressive scalping, manual trading or trading using automated forex systems, each manager has the peace of mind that Yadix can deliver superior order execution.

Investors can choose from a variety of trading strategies, including Auto Forex Trading robots as part of their investment strategy. Distributing capital to different managers is extremely easy and allows the investor to remain in full control of the funds and their accounts 24 hours per day.

The system facilitates a virtual forex relationship between investor and manager to ensure anonymity and peace-of-mind. This gives total confidence for the investor and guarantees investors are protected throughout the relationship. Funds are always held within the fully regulated trading environment and never are the manager responsible for handling actual funds.

Investors remain in control and can revoke Fund Manager permissions at any time. This ensures clients can invest in total confidence.

To participate in our ever growing forex managed accounts programme, click her to Join now.

Diversify your Forex Risk & Reward Management with PAMM Investment

When investing capital into the forex markets, appreciation through trading the forex markets is the ultimate target. To achieve trading targets, traders require a solid forex trading strategy, 100% attention and proper risk management.

Many successful forex traders are now turning to attentions to PAMM Managers, or Forex Account Managers as part of a strategy to give them instant access to multiple trading styles. There is an age old saying that says “you shouldn’t put all of your eggs in one basket”; the same can be said for the capital invested in the forex market. Imagine that you can instantly access five forex brains and five different forex strategies rather than just the one!

The Yadix PAMM community programme gives instant access to multiple professional forex managers, forex strategies and different Risk and Reward settings. By dividing forex trading capital between several proven forex strategies can greatly increases the chances of generating better results and at the same time, reducing the risk by protecting each portion of trading capital that is split across a range of managers, each with a different strategy.

The Yadix PAMM Programme offers multiple professional manager choices, each offering different forex trading strategies, risk and reward levels, as well as offering trading across a wide range of forex symbols and trade-able assets. By implementing an investment strategy to your forex trading, can allow you to protect your capital in a more effective way and at the same time increase your returns on investment.

Investment Overview

• Investment starts from $500
• Monthly returns from 10% - 80% (dependent on strategy choice)
• Automated and manual Managers available
• Proven forex strategies and trading history
• Secure & Regulated Environment
• 24/7 PAMM Monitoring
• No minimum redemption periods

Exclusive Promotion: All new investors that join the programme during January with a minimum of $1,000 and that complete three months in the programme, under any manager will qualify for a $100 cash gift.

For more information about Yadix PAMM, please visit the dedicated PAMM section.