Let's take trading seriously

Hi, before trading was like a hobby for me, now I want to take it to a new level and want to ask you for advise. Experience is something that comes with the time, but can you help me to select time frame and strategy.

I want to start with $1000 account, I'll trade during London, and the begging of US session. 9 hours a day. I want to scalp.

Thanks for advises, in advance!

Hi Loco Guy,
if you want to trade fundamental based, here my approach to fundamental based news trading:

Watch bloomberg while trading and check their website, study the economic calendar (try to get a feeling how the economic events effect the markets).

Twitter is also a nice tool to stay on top of news, if i look for eur/usd news for example i always have an open window with the twitter search.
There are also news searchengines like interceder.

The only indicator i use is recent strenght http://www.forexfactory.com/showthread.php?t=163158
Update your historical charts when using this indicator.
If all timeframes are enabled you will go nutz, i only have 1m,15m,h4,d1,w1 and m1 enabled.

The recent strenght indicator is a nice tool to find the movers, weak currencies etc, wont miss it anymore.

For charting i only draw channel lines, look for breakout and range etc.

Putting all this together works for me but requires some work.

CU and GL

Choosing London is a good idea as it's probably the best session to scalp (depending on which instruments you're trading); for example, EURUSD and GBPUSD move well in this session. There are usually big news releases for the USD in the first few hours of the US session so be aware of those.

Timeframe

Depends on your spread. Using smaller timeframes means you'll be able to see smaller moves and the spread will have more of an adverse effect on your risk/reward. Using larger timeframes means that you won't get as many trading opportunities throughout the day but the spread will not hurt your risk/reward as much.

My advice would be to use a small timeframe like M1 or M5 and zoom out as far as you can go. That way you don't have information hidden in larger timeframe candles but you won't be trading small timeframe candles, you'll be trading more of a line chart. Try it and see. I'd also make sure I had a fixed vertical scale of n pips (I use 150 for EURUSD M1) - that way you will be able to see when the market is doing nothing and when it's really moving.

Strategy

Ideally you should devise your own method of trading so you will understand how and why the method works. Screen-time was important for me in understanding how price moves. On a basic level I (i) choose a direction price is likely to travel in (i.e. due to rejection of a strong support or resistance level) and (ii) buy or sell into that direction on pullbacks. I'm not saying this will be how you do things but it can be a start. Also, try to go for 1 or 2 high probability - small pip value scalps during the day and do that every day. You don't need all of a big move, only part of it. That and compounding will eventually turn your $1000 into something a whole lot larger.

Find something that works on demo before you trade real money.

Don't forget to make sure you understand that stop loss distance and lot size determine how much you will lose when the price goes against you. I didn't get this when I first started trading real money. Sorry if I'm being patronising .

Good luck, and remember all of the above is only my opinion. Do what you feel is right.

its nice to trade London but i prefer more Us , maybe scalping is not best idea but still good luck and if you want scalp use 15min chart i thing everything smaller than that is waste of time

I would do scalping after consolidations periods.
Usually markets develops high volatility at that time.

LocoGuy,

There's no difference among TFs, because they all have the same characteristics. Whichever TF you will use, you will meet with trend, retracement and rally.

The only difference among them is the less TF will move faster than the greater.

You can use trend following strategy. But how you can identify a trend? If the prices in upward progress, it means you are in the uptrend, and inversely.

The Only risk of trend following is you probably will be kicked off by a reversal.

TFs don't all have the same characteristics. For eg the 1m timeframes, across all majors, are much more likely to regress to the mean than the 1hr timeframes. Not to mention the different volatilities across different times of day.

Scalping = spread nightmares, but if I had a gun to my head - you'll need ECN-style spreads, ID ranging periods on a higher TF, before working off the low TFs, and look to always be fading, with maybe 2/3 lot scale in. And I'd probably be looking to hit inverse R:Rs to boot.

You've seen that because the market can be uptrend in 1m TF but ranging in 1H TF and it may be downtrend in daily TF.

If you can't be able to define market behavior how can you make profit from your trading?

Robot is just a tool. Without your understanding about how it works you can benefit nothing from that tool.

100m, your next job should be 10 minutes in Excel proving it one way or the other. As for profitability - know the market you're trading. Intimately.

From my perspective, as short term trader - scalping is the fastes vehicle in all kind of trading methods. It needs much much more experience then just couple of years of trading. So if you are starting with forex, I would advice some more gentle ways of taking profit from the market - like position trading, somewhere you can take a lot of time to make a decision..

scalping is a big risk trading, you better have a lot of experience. Try THV system it is works good for scalping. I would better start with thv on 15M, until you get used to it.

I would advise you to find your own strategy and timeframe suitable to you based on time available for you to watch screen .

Dont start with real money if you havent yet made up your mind on your own approach to trading and have a successful trading plan proved to yourself by demo trading it over some months atleast.

When you have successful trading on demo, then and then only go on real money trading .Use smaller size lots for trading .Risk less than 0.5% on any trade as a beginner .