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A Guide to Creating a Minimalistic Scalping Strategy

  • #21
  • Apr 21, 2017 12:04pm Apr 21, 2017 12:04pm
Quoting venividivici
Good strategy, if you can trade this in a timeframe even lower than 1 minute, even better!..thanks for your contribution.
Hey venividivici,

To be honest I have tried this on 10 second but without any luck. This parameters are best to use on 1 min. chart. Many people consider low time frames to be noisy. Some tell that 1 minute is just white noise. I think you can trade anything if it moves - you just need to have an strategy suitable for this specific environment. This system is for 1M chart and... it works.
  • #22
  • Edited 12:42pm Apr 21, 2017 12:22pm | Edited 12:42pm
Quoting johnmaster
i think even your scalping stratgy is profitable but finding a prefect broker allow scalping is too hard
Hey johnmaster,

I do not think so. I use my broker for last 4 years. I scalp on daily basis, as quick as 1 or 2 pips sometimes. I am not going to advertise on this broker but I think there are plenty of options. Chin up!
  • #23
  • Apr 21, 2017 2:00pm Apr 21, 2017 2:00pm
Nice scalping strategy.Next week i will test it.
Thanks for sharing.
  • #24
  • Edited 7:28pm Apr 21, 2017 7:04pm | Edited 7:28pm
Quoting Plainview
{quote} Hard to tell Xw53Jk. You stick to three lines. In my setup, for better recognition, fastest have lighter color: 12 EMA is gold 26 EMA is blue 55 SMA is black So the faster is moving average the brighter it is. Brighter averages will cross darker averages - this is just clear approach. Drop the rest of it, keep Pivots. Use whatever colors you want but keep it simple. This is the whole point - to have a simple yet robust system.
Yes, what you are talked is true, Sir .... and make system is simple ... ... ... ... .... I want only to make ilustratation for better trade ... ... in my observation that one important point is that the determination of stop loss becomes essential to make better trades to signal filter ......... as one of the points that you write on a post 1
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  • #25
  • Apr 22, 2017 1:36am Apr 22, 2017 1:36am
Quoting johnmaster
i think even your scalping stratgy is profitable but finding a prefect broker allow scalping is too hard
Hello johnmaster, I see you joined in 2013 but only recently have begun to disperse your wealth of knowledge, very good of you.

Do you know about True ECN brokers? They often have spreads of 0.0 on EURUSD and very, very low spreads on all major and minor pairs.

I see you are in USA so that probably limits the brokers that you can use and also limits your view of what the rest of the world is doing.

Personally I use IC Markets in Australia, excellent broker and the spreads are as I said, which make your comment irrelevant.

Best of luck with your scalping, E.
It takes a lot for me to IGNORE you, but you can try.
  • #26
  • Apr 22, 2017 1:55am Apr 22, 2017 1:55am
Session to trade
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  • #27
  • Edited 8:33pm Apr 22, 2017 2:17am | Edited 8:33pm
Quoting Plainview
Hello Traders, This my first thread in Forex Factory. I present my minimalistic strategy which brings me about 20 pips daily on average for the last three months. Forex scalping doesn't need to be complicated at all. All the Best!
Hello Plainview, thank you for your thread, and sharing your ideas. I usually swing trade but I will scalp as the market dictates. For example, this last Friday, no one want to open any new positions with the French election predicted volatility coming, so just scalp for the day.

You mention that it's okay to suggest additional indicators to use, sometimes, these can be called tools, because on the chart when they don't make trading decisions in my opinion.

One is for visual only, the Magnified Market Price, great when posting charts as all can see the pair and time frame quite easily. Also, can display the name of the strategy which is great.

Second is the Currency Strength Giraia found here on Forex Factory, many times it is discussed. Usually people say it has no time frame and it will change quickly - hey, that's perfect for scalpers, right?

I think you restrict yourself to EURUSD is not good when it is stuck in a range. After Frankfurt opened and London is started, find the highest and lowest currency and go to that pair's chart, when the difference is above 5.0 you will find it is moving and good scalping opportunity. Try is and see.

These are in attachment, even a basic template, I have more for later, all the best, E.

PS, on my chart I used Alligator so the 55 is Exponential

EDIT: sorry, included the wrong Magnified Market Price indicator. One ends with MODIFIED and the other with just MOD, so if you already download, try again!
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It takes a lot for me to IGNORE you, but you can try.
  • #28
  • Apr 22, 2017 2:38am Apr 22, 2017 2:38am
@Erebus
How do you use Currency Strength Giraia indicator?
  • #29
  • Apr 22, 2017 2:49am Apr 22, 2017 2:49am
Quoting ionut_blue
@Erebus How do you use Currency Strength Giraia indicator?
At the risk of repeating myself here, I will repeat what I posted earlier - which part don't you understand? Please be specific!

OR.... wait for the market to open next week, watch your charts, watch what the numbers do, especially at Europe opens, think about it !!!

After Frankfurt opened and London is started, find the highest and lowest currency and go to that pair's chart, when the difference is above 5.0 you will find it is moving and good scalping opportunity. Try it and see.

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It takes a lot for me to IGNORE you, but you can try.
  • #30
  • Apr 22, 2017 3:07am Apr 22, 2017 3:07am
Crystal clear now.Thank you.
IS JUST ONE LITTLE PROBLEM...the spread (on that pair for example...my spread is huge).I think this strategy will work only with eur-usd and maybe Usd-Jpy (pair with the lowest spreads).
  • #31
  • Apr 22, 2017 3:11am Apr 22, 2017 3:11am
Here is my scalping system using the same approach but with momentum and MA as filter. For EURUSD only, other pairs are better traded with Logic.
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  • #32
  • Apr 22, 2017 3:21am Apr 22, 2017 3:21am
Quoting Plainview
Just now EUR/USD: Short Entry: 1.07256 Stop Loss: 1.07356 Take Profit: 1.07013 +24,5 pip {image} I am done for today


On a backtest yesterday it did 130 pips. On EURUSD alone, now adding logic to avoid fakeouts, I look for M5 momentum and move lower quickly. And trade the direction of momentum. For M5 i will look for the two MA this eliminates the lag of crossover. On M1 i use one MA and momentum and trade the direction. TP and Exit is always on opposite signal.
  • #33
  • Edited 3:51am Apr 22, 2017 3:27am | Edited 3:51am
Quoting ionut_blue
Crystal clear now.Thank you. IS JUST ONE LITTLE PROBLEM...the spread (on that pair for example...my spread is huge).I think this strategy will work only with eur-usd and maybe Usd-Jpy (pair with the lowest spreads).
Until ... spread 60, you can do it.
Also this indicator is not tied to time. You can sometimes, run whit break even ... so many pip
"Rule No.1: Never lose money. Rule No.2: Never forget rule No.1."... But ..
  • #34
  • Apr 22, 2017 3:44am Apr 22, 2017 3:44am
Quoting Erebus
{quote} At the risk of repeating myself here, I will repeat what I posted earlier - which part don't you understand? Please be specific! OR.... wait for the market to open next week, watch your charts, watch what the numbers do, especially at Europe opens, think about it !!! After Frankfurt opened and London is started, find the highest and lowest currency and go to that pair's chart, when the difference is above 5.0 you will find it is moving and good scalping opportunity. Try it and see. {image}
thanks .............
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  • #35
  • Apr 22, 2017 5:56am Apr 22, 2017 5:56am
Typical ma cross doesn't work, doesn't matter if you use 2, or 3 MAs. It has been tested many many times in the past. Especially if you decide to do something like 1:3 ratio (10 pip sl vs 30 pip gain) you will get wiped out really soon, check for example this friday EURUSD during NY session which didnt even have 30 pip range. Sessions like this happen now all the time. I trade a lot on 1 minute and you need much more sophisticated smoothing MAs and indis (like regularized EMA, HA smoothed averages, One More Average, BB stops, etc) in order to overcome the crazy zigzags 1M graph provides.
  • #36
  • Apr 22, 2017 7:24am Apr 22, 2017 7:24am
Quoting mades
Typical ma cross doesn't work, doesn't matter if you use 2, or 3 MAs. It has been tested many many times in the past. Especially if you decide to do something like 1:3 ratio (10 pip sl vs 30 pip gain) you will get wiped out really soon, check for example this friday EURUSD during NY session which didnt even have 30 pip range. Sessions like this happen now all the time. I trade a lot on 1 minute and you need much more sophisticated smoothing MAs and indis (like regularized EMA, HA smoothed averages, One More Average, BB stops, etc) in order to overcome...
In a lot of the time what you are saying there is some truth ... .... because pips is a picture of the amount of money went into the market (the power is money/balance) ... ... ... ... .... but at least a good trading system will support a trading on only certain market conditions to generate profit...................... so that it takes money to make a holy grail trading system at any time (but that it feels like an impossible thing) ... ... ... ... ... ...
  • #37
  • Edited 10:37am Apr 22, 2017 8:42am | Edited 10:37am
Hi mades,

Quoting mades
Typical ma cross doesn't work, doesn't matter if you use 2, or 3 MAs. It has been tested many many times in the past.
Well, it is just your opinion. Moving averages are one of the basic and most common tools used in technical analysis. Moving Average is commonly used to smooth out short-term fluctuations and highlight longer-term trends or cycles. Not only in Forex, not only in markets but in Economics in general. You can examine gross domestic product, employment or other macroeconomic time series. Mathematically, a moving average is a type of convolution and so it can be viewed as an example of a low-pass filter used in signal processing.

This is just math. There are many trading strategies that use some sort of MA. Do you know Guppy Multiple Moving Average (GMMA), or Triangular Moving Average (TMA)? There are dozens of systems based on those two MA but - wait - there are also hundreds more other system all based on idea of Moving Average or Cumulative moving average or Weighted moving average.

To sum this up MA give you indication. What you will do with it - this is whole other story.

Quoting mades
Especially if you decide to do something like 1:3 ratio (10 pip sl vs 30 pip gain) you will get wiped out really soon, check for example this friday EURUSD during NY session which didnt even have 30 pip range. Sessions like this happen now all the time.
Wait. This is just an example. You will get wiped out anyway if you do not have proper money management. If las swing was 4 pips away, than why don't you just place 6 pip SL and take profit accordingly - as much as market moves your direction considering market situation at the time.

Quoting mades
I trade a lot on 1 minute and you need much more sophisticated smoothing MAs and indis (like regularized EMA, HA smoothed averages, One More Average, BB stops, etc) in order to overcome the crazy zigzags 1M graph provides.
I trade on 1M also. I tried all there is from TDI to Heikin-Ashi - but since it moves a lot you need a clear system to follow that movement. This is mine. It do not have to be as tricky and complicated as you think. This one is simple. That's why it is better.

If you have anything to back up your statement - go ahead - point us in to right direction...

PS: Pro tips on MA historical use:

Technical analysts have been using moving averages now for several decades.

Development of the MA. It was firs published method in Willford I. King’s Elements of Statistical Method (1912).

Exponential smoothing has become very popular as a forecasting method for a wide variety of time series data. Method was independently developed by Robert Brown and Charles Holt. Brown worked for the US Navy during World War II, where his assignment was to design a tracking system for fire-control information to compute the location of submarines. Later, he applied this technique to the forecasting of demand for spare parts (an inventory control problem). He described those ideas in his 1959 book on inventory control.

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Pete Haurlan was the first to use exponential smoothing for tracking stock prices. Haurlan was an actual rocket scientist who worked for JPL in the early 1960s, and thus he had access to a computer. He did not call them “exponential moving averages (EMAs)”. Instead he called them “Trend Values”, and referred to them by their smoothing constants. Thus, what today is commonly called a 19-day EMA, he called a “10% Trend”.
  • #38
  • Apr 22, 2017 9:18am Apr 22, 2017 9:18am
test it then you know the answer
  • #39
  • Edited 12:17pm Apr 22, 2017 10:16am | Edited 12:17pm
Quoting Erebus
{quote} PS, on my chart I used Alligator so the 55 is Exponential {image} {file}
Hi Erebus,

Becareful of 55 EMA. Exponential move faster and is more aligned with price. It should be two fast EMA cuting through slower SMA hence my system is fast 12 EMA cuts slower 26 EMA and then cut slow 55 MA. You have great possibility that price will continue in indicated direction. You ENTER market and stay as long as it continues in this direction.

Simple as that.
  • #40
  • Apr 22, 2017 11:52am Apr 22, 2017 11:52am
@Plainview
subscribe to your thread...
simple but nice strategy
thank you for sharing...

Quoting Erebus
{quote} At the risk of repeating myself here, I will repeat what I posted earlier - which part don't you understand? Please be specific! OR.... wait for the market to open next week, watch your charts, watch what the numbers do, especially at Europe opens, think about it !!! After Frankfurt opened and London is started, find the highest and lowest currency and go to that pair's chart, when the difference is above 5.0 you will find it is moving and good scalping opportunity. Try it and see. {image}
@Erebus
also thank you for your explanation..
i will try your currency meter next week..

have a nice week end..
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