Scalpers are the kind of traders that hold their trades for a few seconds to a few minutes at most.
A forex scalper’s main aim is to capture small profits repeatedly during the busiest times of a trading day and can place anywhere between 10 to 100 trading positions in a single day. Scalping is an expert skill that requires someone who can think quickly and focus intensely. It is best suited for a trader with enough time to spend several hours watching charts with undivided attention. Often, they will use expert advisors or other trading plug-ins to help them increase the number of trades they can place in a short period.
Scalpers often use high leverage to place larger-sized trades because their strategy consists of achieving greater profits from small price changes. The key thing to remember when trading leveraged or margined financial products is that while leverage increases your total profits, it also works to magnify your potential losses.
Scalpers typically use the one- and five-minute charts when trading. They may also purchase market scanning software to support them in finding new trading opportunities. Most scalpers engage in high-volume trading and use online brokers that offer low spreads and low or no commission to keep their trading costs to a minimum.
Key takeaways:
- Scalpers enter and exit the financial markets quickly, usually within seconds.
- Scalpers often use expert advisors to help them execute their trades.
- Scalpers must be highly disciplined, competitive, and fast decision-makers.