Why do people entitle scalping as invalid trading approach? | Forex Factory

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Why do people entitle scalping as invalid trading approach?

  • #1
  • First Post: Sep 11, 2023 11:13am Sep 11, 2023 11:13am
From the very first day of my trading life, I prefer scalping and have been scalping since then. I have high interest in this type of trading but I heard many traders saying scalping isn’t an authentic approach of trading. How will you evaluate their comment?
  • #2
  • Sep 13, 2023 11:53pm Sep 13, 2023 11:53pm
Scalping isn’t a professional way of trading and if you notice you can see expert traders always hold a trade to catch the entire market trend that is impossible by scalping.
  • #3
  • Sep 14, 2023 7:10am Sep 14, 2023 7:10am
Scalping is very hard because we trade against other traders who are better equipped than us to operate in a noise market, where we have to act quickly, make many trades and this all requires constant focus, discipline and monitoring, it can be very tiring, is very easy to get off track.

There are other aspects, but these already give an image of how difficult is to scalp.
Scalping is not for those who want it, but for those who can.

Cheers
Uncertainty of the market must be embraced and accepted.
  • #4
  • Sep 16, 2023 3:09pm Sep 16, 2023 3:09pm
Effectiveness of scalping or any approach depends on an individual trader's skill, strategy, and risk management, btw. So it's important to evaluate it based on your own results and comfort level.
  • #5
  • Sep 16, 2023 5:53pm Sep 16, 2023 5:53pm
Trading requires patience and low risk. When you are scalping, you are normally impatient and highly leveraged or exposed. You will not probably develop as a trader unless you cultivate that patience that leads you to wait for hours or days to find the A+ trade setup you know it works for you. And you only need one setup.

Said that, people say nonsense they hear elsewhere all the time. Do not pay attention to what people say.
  • #6
  • Sep 17, 2023 2:45pm Sep 17, 2023 2:45pm
You have no idea....
There are 2 main reasons leading to failure with scalping. It's all basic arithmetic really.

1. It's very difficult to overcome the High Ratio of transaction cost in relation to the average Maximum Favorable Excursion (MFE) due to short time horizon.
2. Successful scalping requires high accuracy on entry! In other words, you have to rely on very precise trading setups where you have to reduce the Maximum Adverse Excursion (MAE).

With scalping If you pay 1 pip per trade and the average excursion expectation is 5 pips this is huge cost (20%+)! Very difficult to overcome.
But if you pay the same 1 pip per trade and the average excursion expectation is 100 pips the cost is only 1%. So, with longer time horizon you have much higher chances. At least in theory, because You also have to add the swaps into this equation! It's bad..... yes.

And in case you have not noticed by now , the cost is added to your losses! And subtracted from your profitable trades. Do the maths please!
  • #7
  • Sep 21, 2023 4:05am Sep 21, 2023 4:05am
The main reason for scalping failure is your trade is an open hand and it’s trivial for counterparties to fluctuate the price past your tight sexy SL. There is no such thing as “accuracy” in this environment. If you doubt me, just tell me all the details of your trade a minute before you execute it and I’ll ensure you reach 100% … (in)accuracy.
  • #8
  • Sep 25, 2023 2:45am Sep 25, 2023 2:45am
Quoting FHNathaniel
Scalping isn’t a professional way of trading and if you notice you can see expert traders always hold a trade to catch the entire market trend that is impossible by scalping.
I agree. Trend following is the only thing that works it seems. And pretty much nobody likes it. Mentaly too hard to handle due to longer time frames and low winrate. But this it's usually where the money is.
  • #9
  • Sep 25, 2023 2:52am Sep 25, 2023 2:52am
Quoting alphaomega
You have no idea.... There are 2 main reasons leading to failure with scalping. It's all basic arithmetic really. 1. It's very difficult to overcome the High Ratio of transaction cost in relation to the average Maximum Favorable Excursion (MFE) due to short time horizon. 2. Successful scalping requires high accuracy on entry! In other words, you have to rely on very precise trading setups where you have to reduce the Maximum Adverse Excursion (MAE). With scalping If you pay 1 pip per trade and the average excursion expectation is 5 pips this is...
I don't see scalping something that is based on timefrme. For me, if you use a take profit target (or manually cloing your positions), you're a scalper, no matter what time frame you trade on.
  • #10
  • Sep 25, 2023 2:54am Sep 25, 2023 2:54am
Quoting AbdullahBin
From the very first day of my trading life, I prefer scalping and have been scalping since then. I have high interest in this type of trading but I heard many traders saying scalping isn’t an authentic approach of trading. How will you evaluate their comment?
You're are not the onyl one, it seems everybody just prefers scapiong, but it's really the brokers who are scalping you
  • #11
  • Sep 26, 2023 2:57pm Sep 26, 2023 2:57pm
Scalping can be seen as risky and stressful due to small gains from quick trades. But hey, it's not for everyone – high risk, high stress, high rewards... if you're into that!
  • #12
  • Dec 19, 2023 7:40pm Dec 19, 2023 7:40pm
Quoting alphaomega
You have no idea.... There are 2 main reasons leading to failure with scalping. It's all basic arithmetic really. 1. It's very difficult to overcome the High Ratio of transaction cost in relation to the average Maximum Favorable Excursion (MFE) due to short time horizon. 2. Successful scalping requires high accuracy on entry! In other words, you have to rely on very precise trading setups where you have to reduce the Maximum Adverse Excursion (MAE). With scalping If you pay 1 pip per trade and the average excursion expectation is 5 pips this is...
So what’s the solution? ;-)
  • #13
  • Dec 19, 2023 10:17pm Dec 19, 2023 10:17pm
I call myself a scalper/swinger.

- either going for R:R setups

or

- betting/adding much bigger after spotting the right direction (i call it A(+) setup, the chances of winning is much higher).

As a trader you should really capitalize during these windows of time/opportunities even if they only last several minutes (or sometimes hours).

In this way you overcome the commissions/spread and grow the account exponentially.
  • #14
  • Dec 20, 2023 5:41am Dec 20, 2023 5:41am
Quoting AbdullahBin
From the very first day of my trading life, I prefer scalping and have been scalping since then. I have high interest in this type of trading but I heard many traders saying scalping isn’t an authentic approach of trading. How will you evaluate their comment?
Hi Abd……..

Welcome to the club, don’t believe all the dickheads who say scalping isn’t profitable.
Every professional trader I communicate with is a short term scalper, it’s about hitting the market for a pay check every single day.

Here’s the secret.

We scalp for a few pips / ticks on every trade to accumulate enough points hit our daily target.

BUT, and a big BUT

We are really searching for THAT ONE TRADE where we can place a stop loss at break even and let that SUCKER RUN.
Now you start adding trades to build a position to really hit your home run. This process only needs to run for 30 minutes to 3 hours to hit your first achievement Goal.
But no reason why you couldn’t stay in for days either.

What Goal am I talking about?.
Your mission abd… if you wish to accept it is to hit your first $10,000 position profit within the next twelve months.

Don’t think it’s possible?,
Don’t believe it’s not possible.

Therefore, scalp the fuck out of the market till you see that opportunity to let your last trade run

And run
And run

Hint. Your best chance to find a runner is after US open.

Your choice
Trading thin liquidity at the boundary of the charts
  • #15
  • Edited 8:26am Dec 20, 2023 7:54am | Edited 8:26am
Quoting AbdullahBin
From the very first day of my trading life, I prefer scalping and have been scalping since then. I have high interest in this type of trading but I heard many traders saying scalping isn’t an authentic approach of trading. How will you evaluate their comment?
I scalp NQ e-mini everyday. Moreover, I have back-tested on several years worth of e-mini data and found that scalping does work. A profit factor of 2+ is quite achievable. However, I don't scalp just for a few ticks. I usually scalp for a profit target between 10 points to 20 points (40 to 80 ticks) on the NQ e-mini, depending on volatility (ATR). If the ATR is very high (upon the market open or on news, for example) or too low, I just stay out. Scalping is intense and requires a lot of focus, hence scalping all day long is so impractical. We should have the discipline of halting scalping once our pre-defined daily profit/loss limit is hit or after a certain number of trades and that's what I lack a bit and still working on. :-) But yes, it does work. If one wants to trade for a living, predictability of income is also important and scalping can provide that even if it means missing big moves.
  • #16
  • Dec 21, 2023 6:36am Dec 21, 2023 6:36am
I’ve known many successful intraday and swing traders but never met scalpers. So my opinion is trading is considered high risk already & u just double up your risk by being scalper. If you want to be scalper anyway make sure u target at least 1:3 riskrewardratio.
For me I prefer intraday & swing position, but soment8mes i do scalp during retrecement in my position..
  • #17
  • Dec 21, 2023 3:14pm Dec 21, 2023 3:14pm
Quoting irfan02
I’ve known many successful intraday and swing traders but never met scalpers. So my opinion is trading is considered high risk already & u just double up your risk by being scalper. If you want to be scalper anyway make sure u target at least 1:3 riskrewardratio. For me I prefer intraday & swing position, but soment8mes i do scalp during retrecement in my position..
Scalping definition may vary, both in terms of how many points/ticks you target and RR ratio. I believe most scalpers use 1:1 or even 2:1 (risking 2 to make 1!). I switch between 1:1 and 2:1 depending on market conditions and setups. What I have found in my back-testing and live trading experience is that 2:1 scalping isn't as bad as one may think. It's just psychologically harder to handle if several losses in a row. So I mostly stick to 1:1 but rarely 1:2 or higher because the win rate goes down significantly and hence doesn't align well with my personality.
  • #18
  • Dec 22, 2023 7:38am Dec 22, 2023 7:38am
Quoting AbdullahBin
From the very first day of my trading life, I prefer scalping and have been scalping since then. I have high interest in this type of trading but I heard many traders saying scalping isn’t an authentic approach of trading. How will you evaluate their comment?
I can tell you my experience.
Dont focus on the principle of scalping it self, its more about the trade management, how will you Deal with trades that run against you? Everyone can close profits.

How are your average profits looking? Can they Cover losses or drawdowns?
I turned 2.000€ into 10.000€ live on IC markets and i have the track record to back it up. I have a 4.11 profit Faktor and 77% - 82% winnrate
Im a scalper, but the danger of my strategy is price averaging and drawdowns.
Most people would do grid or martingale, i would say i have a opposite approach.

Lets just for example say i Go short 1lot, if price moves against me and im too early i hedge with smaller buys fast, lets say a 0.50lot buy, now i hedged 50% of my short and reduced or slowed down potentiall drawdown, if price falls from there i still have 0.50lot net short, if price goes up I can either scalp smaller buys like 0.10 - 0.20lot and take profits while still over all being positioned net short with my total positions.
Or at some point instead of averaging into more short Position like a grid trader would do, i slowly Start closing my buys and take those profits and average my exit price up. (Opening the hedge again)
This way i can Cover or slow down drawdowns, the Key is your profits run full lot size, your drawdowns are covered and slowed down, ofcurse its not that easy.
You need to be Aware of higher timeframes cycles and based on that you can think about your exact trade management and price averaging.
You also should have a low initial lotisze Compared to the balance you trade, something where 400-500x pips would be below 10% drawdown.
I know it Sounds risky, but numbers dont lie, thats how i made 8.000€, i would say its much better then grid, martingale or just leaving a trade till it comes back, its much safer and the principle of slowing down drawdowns and averaging them up while leaving profits full lotsize just makes sense
1k to 100k Copy Trading All Time Return: 367.9%
  • #19
  • Dec 22, 2023 2:30pm Dec 22, 2023 2:30pm
Quoting Thomas.
{quote} I can tell you my experience. Dont focus on the principle of scalping it self, its more about the trade management, how will you Deal with trades that run against you? Everyone can close profits. How are your average profits looking? Can they Cover losses or drawdowns? I turned 2.000€ into 10.000€ live on IC markets and i have the track record to back it up. I have a 4.11 profit Faktor and 77% - 82% winnrate Im a scalper, but the danger of my strategy is price averaging and drawdowns. Most people would do grid or martingale, i would say...
I am not sure I fully get it but understood partly - interesting approach.
  • #20
  • Dec 22, 2023 9:46pm Dec 22, 2023 9:46pm
Quoting Thomas.
{quote} I can tell you my experience. Dont focus on the principle of scalping it self, its more about the trade management, how will you Deal with trades that run against you? Everyone can close profits. How are your average profits looking? Can they Cover losses or drawdowns? I turned 2.000€ into 10.000€ live on IC markets and i have the track record to back it up. I have a 4.11 profit Faktor and 77% - 82% winnrate Im a scalper, but the danger of my strategy is price averaging and drawdowns. Most people would do grid or martingale, i would say...
how many pips in drawdown/ against you will you do the hedge?
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