How to calculate indicators for scalp trading? | Forex Factory

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How to calculate indicators for scalp trading?

  • #1
  • First Post: Feb 23, 2024 3:31pm Feb 23, 2024 3:31pm
Im in the process of developing my tradebot, and to supplement my possible profit, i want to also try my hand at scalp trading. While chatting to chatgpt about it, he mentioned that scalp trading involves using the same well know (or lesser known) indicators, but then instead of using other days historic data to calculate, i should use the same days, and current trends data to calculate. So for example a sma would take 10 data points of for example 1 minute icrement prices and calculate the average. And then the rest is all the same.. compare it to the current price and generate a signal based on criteria.. can anybody else confirm this, and more importantly can anybody else confirm weather or not other days historic data is used whatsoever in scalp trading succesfully?


Greetings,

Stefan.
  • #2
  • Feb 24, 2024 4:31pm Feb 24, 2024 4:31pm
Quoting StefanN
Im in the process of developing my tradebot, and to supplement my possible profit, i want to also try my hand at scalp trading. While chatting to chatgpt about it, he mentioned that scalp trading involves using the same well know (or lesser known) indicators, but then instead of using other days historic data to calculate, i should use the same days, and current trends data to calculate. So for example a sma would take 10 data points of for example 1 minute icrement prices and calculate the average. And then the rest is all the same.. compare it...


Update.. chatgpt says using other days data is far less common in scalp trading.. i will ask more to get to the bottom of this subject, and post it here to serve as a resource for beginners.
  • #3
  • Edited 7:02am Feb 25, 2024 2:32am | Edited 7:02am
Quoting StefanN
Im in the process of developing my tradebot, and to supplement my possible profit, i want to also try my hand at scalp trading. While chatting to chatgpt about it, he mentioned that scalp trading involves using the same well know (or lesser known) indicators, but then instead of using other days historic data to calculate, i should use the same days, and current trends data to calculate. So for example a sma would take 10 data points of for example 1 minute icrement prices and calculate the average. And then the rest is all the same.. compare it...
Hi, have you considered taking time to become familiar with the basics and build foundations?
Someone who I appreciate greatly, has taught me that a 'chart is a chart is a chart'... so the data can be of what ever period, in the way it is separated... yet, still be a chart... just with a different label in the top left...

Regarding your example... your chatbot is not correct... I would first ask; what makes you think that particular large language model knows anything about "trading" when its only likely job is to predict the next word in the sentence?
Using a 1 minute timeframe (data broken up into 1 min increments) with a 10 period SMA, does indeed show an average price for the last 10 minutes... yet, already if we start a new day on the same chart... data of the previous day will be used as part of the calculation, so it is clear the chatbot fails to consider this... Aslo, after a bar prints or to be more accurate a tick comes in... it pretty much becomes historic price...
Trading involves more than one signal being generated... there is risk to manage, to exit position(s)...etc
I would suggest one would get far more value from looking at a chart, than time spent chatting to a text predictor chatbot...
"Work hard, put in the effort, and follow your dreams..." -Me
  • #4
  • Feb 25, 2024 10:29am Feb 25, 2024 10:29am
Quoting tzamo
{quote} Hi, have you considered taking time to become familiar with the basics and build foundations? Someone who I appreciate greatly, has taught me that a 'chart is a chart is a chart'... so the data can be of what ever period, in the way it is separated... yet, still be a chart... just with a different label in the top left... Regarding your example... your chatbot is not correct... I would first ask; what makes you think that particular large language model knows anything about "trading" when its only likely job is to predict the next word in...

Well to each their own opinion, but either chstgpt is making it all up, or is very knowledgable on the subject of trading (judging from my months long development period with chatgpt).. the only detail you were able to "catch" it on, is in the case of midnight, where the historic data used is technically in the previous day.. tho this "mistake" is probably down to my phrasing of the initial question. But the rest of my overall approach aligns with best practise in forex trading..
  • #5
  • Feb 25, 2024 9:31pm Feb 25, 2024 9:31pm
Quoting StefanN
{quote} Well to each their own opinion, but either chstgpt is making it all up, or is very knowledgable on the subject of trading (judging from my months long development period with chatgpt).. the only detail you were able to "catch" it on, is in the case of midnight, where the historic data used is technically in the previous day.. tho this "mistake" is probably down to my phrasing of the initial question. But the rest of my overall approach aligns with best practise in forex trading..
I didn't comment to nit-pick or "catch" details... believe it or not, for some the daily chart is the scalping chart... I only tired to hint at; there are some things that can only be learned via doing and practice... no amount of chatting to a fancy blackbox chatbot that 'got its data from who knows where' will accomplish that... seems you have a fair bit invested in that co development, just keep in mind that a similar amount of time could have been used to learn how to develop directly and get the skills for yourself... and not too late to change
Take from that what you will, and I guess only time will tell.....
"Work hard, put in the effort, and follow your dreams..." -Me
  • #6
  • Feb 25, 2024 11:54pm Feb 25, 2024 11:54pm
Quoting StefanN
Im in the process of developing my tradebot, and to supplement my possible profit, i want to also try my hand at scalp trading. While chatting to chatgpt about it, he mentioned that scalp trading involves using the same well know (or lesser known) indicators, but then instead of using other days historic data to calculate, i should use the same days, and current trends data to calculate. So for example a sma would take 10 data points of for example 1 minute icrement prices and calculate the average. And then the rest is all the same.. compare it...
The key is to find a trading strategy that aligns with your personality, risk tolerance, and goals. Whether that involves following the trends, trading breakouts, or focusing on fundamentals, the important thing is to stay disciplined, manage your risk, and never stop learning. And of course, having a supportive community like this forum can be incredibly valuable as well.
Looking for profitable short term trades ...|
  • #7
  • Feb 26, 2024 12:38pm Feb 26, 2024 12:38pm
In my experience with scalp trading, I rely on indicators such as short-term moving averages, stochastic oscillator, and RSI to quickly identify entry and exit points for trades. These indicators, when adjusted to shorter time frames, provide timely signals aligning with the rapid pace of scalp trading, enhancing the probability of success in capturing small price movements.
  • #8
  • Feb 26, 2024 2:13pm Feb 26, 2024 2:13pm
I scalp trade ES futures. I use the cumulative tick chart and fade over/under 1000 ticks. It's usually good for 5-10 ticks profit.
Attached Image (click to enlarge)
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Volatility does not equal risk.
  • #9
  • Feb 26, 2024 2:35pm Feb 26, 2024 2:35pm
Quoting Js3mwtRc
{quote} The key is to find a trading strategy that aligns with your personality, risk tolerance, and goals. Whether that involves following the trends, trading breakouts, or focusing on fundamentals, the important thing is to stay disciplined, manage your risk, and never stop learning. And of course, having a supportive community like this forum can be incredibly valuable as well.

I agree with you.. but in my case i am planning to trade automatically, and am thinking of adding scalp trading as a means to combat the reduced frequency of trades in times of parameter drift within my other trading styles and their respective strategies.. this way i can reach my trading goals with ease.. snd as it is automated trade, it has to fit my personality less, because my task is only to monitor daily, and adjust things here and there..


I do agree with you though, this community is very helpfull.
  • #10
  • Feb 26, 2024 3:40pm Feb 26, 2024 3:40pm
Quoting StefanN
{quote} Update.. chatgpt says using other days data is far less common in scalp trading.. i will ask more to get to the bottom of this subject, and post it here to serve as a resource for beginners.


As promised i have gotten to the bottom of this, and the verdict is that for scalping purposes only the days data is used.. for short term strategies (trades lasting 0.5 to 1 hour) both indicators using only the trading days, and using also other days data is optimal. For mid term strategies (lasting 1-2 hours) the same story.. this is for beginners wondering.

Ps: if anybody already trading can confirm or denounce this (rare situations /setups aside) you would be appreciated.
  • #11
  • Feb 26, 2024 3:45pm Feb 26, 2024 3:45pm
Quoting tzamo
{quote} I didn't comment to nit-pick or "catch" details... believe it or not, for some the daily chart is the scalping chart... I only tired to hint at; there are some things that can only be learned via doing and practice... no amount of chatting to a fancy blackbox chatbot that 'got its data from who knows where' will accomplish that... seems you have a fair bit invested in that co development, just keep in mind that a similar amount of time could have been used to learn how to develop directly and get the skills for yourself... and not too late...

I understand your pov, but wonder how knowledgable you are on chatgpt. It has shown itself as very knowledgable on trading to me, and is confirming that every facet of my plan aligns with best practise in algorithmic trading.. i challenge anybody to open chatgpt, and outline their approach concerning strategy development and live trading, and get the same response.. i have been enthousiastically developing this in theory for months, and i can tell you it wasnt easy getting this theory as a endresult..
  • #12
  • Feb 26, 2024 3:59pm Feb 26, 2024 3:59pm
Quoting Blckcptl
I scalp trade ES futures. I use the cumulative tick chart and fade over/under 1000 ticks. It's usually good for 5-10 ticks profit. {image}
How did you exactly got this chart? Like what does this exactly show?
  • #13
  • Last Post: Feb 27, 2024 9:25am Feb 27, 2024 9:25am
Quoting Rickvdp
{quote} How did you exactly got this chart? Like what does this exactly show?
The tick index compares the number of stocks that are rising to the number of stocks that are falling on the New York Stock Exchange (NYSE). The index measures stocks making an uptick and subtracts stocks making a downtick.

https://www.investopedia.com/terms/t/tickindex.asp
Volatility does not equal risk.
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