Even the most experienced forex traders’ recoil whenever they think about Forex scalping, also known as Forex short term trade. A simple search in the internet will bring forth hundreds of articles on the subject as well as listing the dangers and losing your money by choosing this form of trading. However, it is not as bad as these articles make out it to be. Forex short term trading is a brisk way of trading and its experience can be very thrilling as long as you know what you are doing and have little regard about the consequences.
The first thing to be considered for opting for this trade of trading is your temperament. If you are nervous, hypersensitive and jittery type of trading, you should invariably stay away from forex short term trading, as you are likely to get yourself in trouble.
Forex Short Term – Steadiness and Discipline
Discipline and steadiness is the key for becoming successful in forex short term trading as this sort of trading involves a large amount of shortly timed trades. In case the trader continues to hang on into a position he has scalped on the losing side just because he is convince that the market will change, all his profits can be lost in just a few seconds. Here the trader must remain almost like a robot in his trading, without any emotion, simply because it’s the turnover he is after. He must know that he may often sustain losses over and above profits, but on the average it should be on the profit side, if the Forex short term trading is carried out properly.
Another important thing to be considered is ‘quantities of the trade’. In case the trader varies the ‘quantities’ and tries to make up a loss by doubling down (as usually done in gambling), or even worse, erratically changes the quantities, he may be out of money very soon. Therefore he must maintain a level of quantity in his trade.
Types of Strategies
There are many types of strategies in forex short term trading, and you should study all of them. The breakout scalping, range scalping and trend scalping are the most important strategies. The use of these strategies depends on the nature of the market.
Every trading system, including forex short term trading needs research and experiment. The attractiveness of scalping is that you do not have to follow trends or market movement. There are some markets that are more prone to it for the simple reason that Forex short term trading relies a great deal on market saturation.