1 or 2-pip volatility-based scalping idea? | Forex Factory

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1 or 2-pip volatility-based scalping idea?

  • #1
  • First Post: Apr 26, 2021 4:23pm Apr 26, 2021 4:23pm
Hi all,

I was thinking of kind of a scalping strategy while having a look at charts and ticks. I figured, most of the time, when having a look at M1 charts, in times of high volatility (highly volatile pairs, London & NY sessions, Tue. through Thu.), ticks are all over the place: whether the price is ranging or trending, the price goes up and down quite a lot even when there is a certain drift to the random motion.

So my thought was, what if at the very beginning of each candle, we set a high lot-size order (direction should be based off a strategy, or maybe systematically always long or short, or maybe chosen at random), while setting a very small and "ghost*" TP of like 1 or 2 pips? And close to no SL. This would obviously be a super risky strategy but if it works enough so that you can cash-out profits regularly, this might be worth the shot. With specific market conditions where ticks are all over the place, I feel like this can maybe work?

I am totally new to scalping and all that, so I might be totally wrong, but I would like to know if you guys ever tried something similar, and if so, what were your experiences with it?

*ghost as in the TP is not explicitly set, to possibly avoid giving brokers information about the strategy.
Also, I thought of this idea when having a look at this video that seems quite unrealistic, although it made me curious:
Inserted Video


Cheers,
m10021
  • #2
  • Apr 27, 2021 12:00am Apr 27, 2021 12:00am
Quoting marengo10021
Hi all, I was thinking of kind of a scalping strategy while having a look at charts and ticks. I figured, most of the time, when having a look at M1 charts, in times of high volatility (highly volatile pairs, London & NY sessions, Tue. through Thu.), ticks are all over the place: whether the price is ranging or trending, the price goes up and down quite a lot even when there is a certain drift to the random motion. So my thought was, what if at the very beginning of each candle, we set a high lot-size order (direction should be based off a strategy,...



in 24 hours his total net worth would be in the trillions.

you can try it, and you'll see the shortcomings for yourself

btw these erractic price moves at daily open is basically a LP coming online after maintenance or smth. the erractic move is basically from mt4 capturing the server's side catching up matching bb/ss
  • #3
  • Apr 27, 2021 12:25am Apr 27, 2021 12:25am
Quoting marengo10021
So my thought was, what if at the very beginning of each candle, we set a high lot-size order (direction should be based off a strategy, or maybe systematically always long or short, or maybe chosen at random), while setting a very small and "ghost*" TP of like 1 or 2 pips? And close to no SL. This would obviously be a super risky strategy but if it works enough so that you can cash-out profits regularly, this might be worth the shot. With specific market conditions where ticks are all over the place, I feel like this can maybe work?
it gives the illusion that even if you can win 100 times with TP 2 pips, it is always during the heat of the moment the fingers not able to click close, the emotion and thought say "what if it will turn around soon" that the last trade will declare it is game over.

not afraid of 10,000 times, but only be afraid of that one time "what if".
ITB - Seeing Orderliness amongst 'Randomness'
  • #4
  • Apr 27, 2021 1:43am Apr 27, 2021 1:43am
It won´t work. But I guess you have to try to believe that.

No system that wants to trade and make money all the time works. You wont even make 100 winners in a row and 1 loss will be horrible damage.

When people work day jobs, they do not get money several times per day, they get monthly salary (sometimes weekly). It is easier to wait for a trade that gives you 100 pips and take 1 trade per week than be all over the charts and on emotional carousel whole day.

Your idea doesn´t work. It certainly does not work with Metatrader and your internet connections (google HTF-s and banks to find out more). Sorry.
Markets will move to the right.
  • #5
  • Apr 27, 2021 3:02am Apr 27, 2021 3:02am
Got it, thanks for replying!
  • #6
  • Apr 27, 2021 4:27am Apr 27, 2021 4:27am
Sorry not had time to properly read this. Have you looked at something like option trades with quotex. Minimum of 1 min expiry.

I’ve a system I use expiry I use is 2mins, decision taken of direction from a 1m chart
  • #7
  • Apr 27, 2021 1:16pm Apr 27, 2021 1:16pm
Quoting Inthebox
{quote} it gives the illusion that even if you can win 100 times with TP 2 pips, it is always during the heat of the moment the fingers not able to click close, the emotion and thought say "what if it will turn around soon" that the last trade will declare it is game over. not afraid of 10,000 times, but only be afraid of that one time "what if".
Maybe using an EA stops emotions from stopping you,
  • #8
  • Apr 28, 2021 7:42am Apr 28, 2021 7:42am
Quoting SWGamer
{quote} Maybe using an EA stops emotions from stopping you,
That's my initial idea yeah. No manual trading involved, just a very simple EA that would systematically stop at securing a single pip advantage. But yeah, not sure if it would work...
  • #9
  • Apr 29, 2021 1:40am Apr 29, 2021 1:40am
Quoting marengo10021
{quote} That's my initial idea yeah. No manual trading involved, just a very simple EA that would systematically stop at securing a single pip advantage. But yeah, not sure if it would work...

Not sure if the video on YT is yours, but let me tell you this. In the video description you literally talk about it, like you know it works. Nothing about "it might not work" etc... Also video title is LIVE trading. So, was this live account or not? Because You don't even show the acc number and if it is live or not, I will say it was demo.

Just asking... Nothing bad.

Thanks,

SF
  • #10
  • Apr 29, 2021 2:18am Apr 29, 2021 2:18am
Quoting SilentFather
{quote} Not sure if the video on YT is yours, but let me tell you this. In the video description you literally talk about it, like you know it works. Nothing about "it might not work" etc... Also video title is LIVE trading. So, was this live account or not? Because You don't even show the acc number and if it is live or not, I will say it was demo. Just asking... Nothing bad. Thanks, SF
Feels like you did not read my whole post then...
I said that I thought of this idea when I stumbled upon this video (which is NOT mine then!). I have no idea if this video is live or demo trading, nor do I have more information on it than anyone watching it on YouTube!
  • #11
  • Apr 29, 2021 3:16am Apr 29, 2021 3:16am
Quoting marengo10021
Hi all, I was thinking of kind of a scalping strategy while having a look at charts and ticks. I figured, most of the time, when having a look at M1 charts, in times of high volatility (highly volatile pairs, London & NY sessions, Tue. through Thu.), ticks are all over the place: whether the price is ranging or trending, the price goes up and down quite a lot even when there is a certain drift to the random motion. So my thought was, what if at the very beginning of each candle, we set a high lot-size order (direction should be based off a strategy,...
Except for the fact that you mention not to use stop loss (use one internally), I encourage you to conduct a research.

I would remove the idea of start every trade when a bar opens. You may also bring to your research spreads and slippages on those moments where you feel the price moves up and down. Finally, and very important, research about whether the price has more chances to move up or down and supported by some logic. If you think the price is equally possible to move up and down, then you may find situations where that's more common: when the market is flat? when the market is flat and volatity is important? at low liquitidy hours? at calmed scenarios on important trade hours? at low impact news releases? at high impact news releases having releases data similar value than that expected?

Hope you find a good strategy.
Always ready to help
  • #12
  • Apr 29, 2021 3:42am Apr 29, 2021 3:42am
generally, you have to be ready for this type of equity curve

https://www.forexfactory.com/attachm...1&d=1614090454
Get the Lag out
  • #13
  • Apr 29, 2021 5:04am Apr 29, 2021 5:04am
Quoting marengo10021
{quote} Feels like you did not read my whole post then... I said that I thought of this idea when I stumbled upon this video (which is NOT mine then!). I have no idea if this video is live or demo trading, nor do I have more information on it than anyone watching it on YouTube!
Correct. I was reading it very fast. I was going out. xD Sorry for that!

SF
  • #14
  • Apr 29, 2021 5:51am Apr 29, 2021 5:51am
Overall, you guys have to understand that I don't imagine this as being a very safe, risk-proof method at all. I view it more as a "maximal risk, maximal reward, cash-out regularly" strategy where the objective is to bet on the fact that with big enough lot size per trade and a smart strategy to decide entry and direction for each trade, we could enough cases of 1 or 2-pips profit to counter cases where the account gets blown. That's basically gambling but with estimation of probabilities and expected survival in the market in advance.

Quoting ZeroLag
generally, you have to be ready for this type of equity curve https://www.forexfactory.com/attachm...1&d=1614090454
This is the type of curve I thought of yeah, but basically you would withdraw all the time to avoid the blow-up to actually eat up all the profits.
I also saw that: https://www.mql5.com/en/forum/140867. Currently, I am away of my setup so I cannot test anything, although I am doing a bit of Python to simulate scenarios and see if this is viable. Anyone ever tried similar EAs as the one mentioned in this link? Again, I am not thinking about manual trading at all, as this stuff goes way too fast for a human being to react correctly.

Also, I think HFT and banks trade and make micro-profits on a much smaller scale, but millions/billions of times a day, although I am not sure about this at all. So maybe this is worth a shot?

And the entry strategy would be based on market conditions (trending, ranging, volatile, position of price curve w.r.t. EMAs, etc.).

Final thought, in case of things going down (e.g. long position opened, the price actually goes down and never reaches open price + 1-2pip + spread), I thought of setting a limit where a counter trade (same size, opposite direction) would kick in. I would not call this actual "hedging", but in case of zero margin hedge brokers, this can help pausing the bleeding, while doing some other trades to pull the balance up, before closing one or both of these positions for a possible, but then more manageable loss.
  • #15
  • Apr 29, 2021 6:47am Apr 29, 2021 6:47am
Quoting marengo10021
Overall, you guys have to understand that I don't imagine this as being a very safe, risk-proof method at all. I view it more as a "maximal risk, maximal reward, cash-out regularly" strategy where the objective is to bet on the fact that with big enough lot size per trade and a smart strategy to decide entry and direction for each trade, we could enough cases of 1 or 2-pips profit to counter cases where the account gets blown. That's basically gambling but with estimation of probabilities and expected survival in the market in advance. {quote} This...
You may keep simulating with Python and hope you reach some conclusion.

I wouldn't consider this HFT. HFT with EAs and Python maybe don't match.

Quote
Final thought, in case of things going down (e.g. long position opened, the price actually goes down and never reaches open price + 1-2pip + spread), I thought of setting a limit where a counter trade (same size, opposite direction) would kick in. I would not call this actual "hedging", but in case of zero margin hedge brokers, this can help pausing the bleeding, while doing some other trades to pull the balance up, before closing one or both of these positions for a possible, but then more manageable loss.

Better if you don't do that. Just close the position and wait for the next trading opportunity. You don't have to pay more commissions than necessary.
Always ready to help
  • #16
  • Apr 29, 2021 7:51am Apr 29, 2021 7:51am
Quoting PaulMF
{quote} You may keep simulating with Python and hope you reach some conclusion. I wouldn't consider this HFT. HFT with EAs and Python maybe don't match. {quote} Better if you don't do that. Just close the position and wait for the next trading opportunity. You don't have to pay more commissions than necessary.
That’s precisely my point, that we as retail are no match versus HFT. I just think this is not even close to HFT there, just some sort of scalping with very low TP levels.
  • #17
  • Feb 7, 2024 4:18am Feb 7, 2024 4:18am
Hi,
I was able to achieve 2 pips consistenly 20 times in a row, but 21th trade turned all down, so its risky but yes good trading approach can help you to get. any good EA may be.
  • #18
  • Last Post: Feb 19, 2024 10:46am Feb 19, 2024 10:46am
The EA for your Idea (free)
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