Scalping is a high-speed trading strategy designed to make small profits from very short-term price movements. Scalpers aim to enter and exit trades within seconds or minutes, capitalizing on tiny price changes. By making multiple trades throughout the day, they accumulate small profits that add up over time.
Timeframe: Scalping is usually done on 1-minute (M1) to 5-minute (M5) charts.
Objective: The goal is to capture small profits from every trade by entering and exiting the market quickly.
Number of Trades: Scalpers can place dozens or hundreds of trades in a single day, depending on market conditions and the opportunities available.
Market Condition: You observe that EUR/USD is moving within a narrow range between 1.1200 and 1.1210.
Entry Point: You buy at 1.1202, expecting the price to bounce off the lower end of the range (1.1200).
Exit Point: You aim to sell at 1.1205, targeting a small gain of 3 pips.
Profit: A 3-pip gain on a small position. This process is repeated multiple times throughout the day to build up profits.
Using MT5 for Scalping
Sign Up & Fund Your Account: Open an account with FNmarkets and deposit funds into your account.
Download MT5: Install MetaTrader 5 (MT5) to access advanced charting tools, low-latency execution, and better order management features, ideal for scalping.
Use the Right Timeframes: Scalping typically happens on 1-minute (M1) or 5-minute (M5) charts, where you can spot small price movements.
Watch Price Movements in Real-Time: Keep an eye on real-time price fluctuations to identify entry points.
Use Tight Spreads and Liquidity: Scalping requires low spreads and high liquidity. FNmarkets offers competitive spreads, which are crucial for scalpers to minimize trading costs.
Set Entry and Exit Points
Precision is key in scalping. Set your take-profit and stop-loss levels at tight points to capture profits quickly and limit losses.
Leverage (Optional)
Scalpers often use high leverage to maximize small price movements. Use leverage cautiously, ensuring proper risk management to avoid large losses.
Scalping on FNmarkets allows traders to take advantage of short-term price movements with the goal of making small, frequent profits. Using MT5, tight spreads, and precise entry/exit points, scalpers can efficiently execute their trades. While leverage can amplify profits, it should be used carefully with proper risk management to avoid significant losses.