Scalping - anyone brave?

[Bobby]

Scalping intrigues me, anyone using this techniqe ?.

Its the trade that only lasts from seconds to minutes to make or lose money.
You grab a profit real quick from momentum & get out ?.

This style of trading is not for the squeamish & even made my heart rate go up just paper trading it ! Beware .

Bob.

 

[wayneL]

Re: Scalping -anyone brave ?

Scalping intrigues me, anyone using this techniqe ?.

Its the trade that only lasts from seconds to minutes to make or lose money.
You grab a profit real quick from momentum & get out ?.

This style of trading is not for the squeamish & even made my heart rate go up just paper trading it ! Beware .

Bob.

It's a lot of fun when you're winning.... and you must have the right psychological type.

When I was trading the US, I participated in an Index futures trading chat room, where folks called their trades live. Many of those were scalpers.

Overall it's a tough deal. Some are very talented at it and do very well, most scratched by. The best way to trade in the day trading context (and this is born out in my own experience and watching the others) is trading off support/resistance and letting the trade develop a bit... go for the bigger intraday swing in other words.

More folks were successful this way, than by scalping.

Cheers

 

[Bobby]

Re: Scalping -anyone brave ?

It's a lot of fun when you're winning.... and you must have the right psychological type.

When I was trading the US, I participated in an Index futures trading chat room, where folks called their trades live. Many of those were scalpers.

Overall it's a tough deal. Some are very talented at it and do very well, most scratched by. The best way to trade in the day trading context (and this is born out in my own experience and watching the others) is trading off support/resistance and letting the trade develop a bit... go for the bigger intraday swing in other words.

More folks were successful this way, than by scalping.

Cheers

Gee that must have been fun watching the trades called live !, you must have seen some funny stuff, like the quick & the dead.

Trading of the intraday swings of support/resistance sure would be less stressful as well Wayne ?.

Regards Bob.

 

[wayneL]

Re: Scalping -anyone brave ?

Gee that must have been fun watching the trades called live !, you must have seen some funny stuff, like the quick & the dead.

Trading of the intraday swings of support/resistance sure would be less stressful as well Wayne ?.

Regards Bob.

Yes! Certainly less stressful as far as I am concerned....and for me, more profitable.

 

[Milk Man]

I thought 'scalping' was arbitrage...

 

[charttv]

I scalped ASX stocks for several months a few years back. It was fast paced and mostly profitable except for the fact that I could only go long which was great in the bull rallies but terrible when the market ran into any prolonged bearishness.

I stopped scalping when I realised how miniscule my profits were compared to my transaction costs and how terrible the risk to return factor was. With stocks, if you're looking to take the smallest possible profit which was quite often only one price step (0.1c) you are still running the risk of the stock going into suspension and then gapping down several price steps when trading resumes.

I wouldn't recommend this strategy to beginners.

 

[charttv]

I neglected to add that the profits from hundreds of scalps were tiny compared to what I made on a position trade over the same duration.

 

[Bobby]

I neglected to add that the profits from hundreds of scalps were tiny compared to what I made on a position trade over the same duration.

Hello Charttv,
Thanks for your replies, but why were you worried about a stock being suspended when doing a scalp, (most are seconds to a minute or two) all trades of any time frame take this on.

Like to know more about your scalps please, would be most interesting to me & others.

Bob.

 

[charttv]

One of the criteria for choosing a stock to scalp was that it had either released news that day or was about to release news. Before many announcements it was not uncommon for a stock to be suspended. If the news was good it was also not uncommon that the stock would gap up when suspension was lifted. If the news was disappointing then the stock could gap down. This could happen within minutes of entering the trade.

Also, you may enter the stock with the intention of covering before the day is out but suspension can last for several days. In the meantime, market sentiment may have turned from bullish to bearish.

If I ever scalped again I would look to do it in a far smoother instrument such as an index or FOREX.