Simple trading strategies for the new scalpers
Forex scalping is a popular trading strategy among professionals. It has to be executed within a very short duration, which ranges from a few seconds to a maximum of 15 minutes. But traders hardly wait for 15 minutes to execute the deal. Instead, they usually wait for 1 minute to 5 minutes. Because of this extremely short duration, we highly prohibit beginners from involving in this strategy. But they can try it once they gather a vast amount of knowledge. Remember that scalping is regarded as the riskiest trading plan.
Simple strategies for Forex scalpers
These are regarded as the simplest strategies for the CFD scalpers.
1. Bollinger bands
Bollinger bands are mainly used for checking the volatility of the market. Simply, if you notice that the bands are far away from the center, you have to realize that the price’s fluctuations are heavy, which means the market is highly volatile. If the bands are nearer to the center, the beginner will have to understand that the industry is in a consolidated state. Professionals advise measuring the lowest and peak points of the currency. This strategy is quite simple to use, and to use it effectively, it is better to practice it in a demo account.
2. Price action and volume
In this strategy, the newbies have to learn using the volume indicator to search for ideal price action. The entire concept is based on a theory, which states that – changes in the volume are generally followed by the price action. Therefore, it can be said that volume is a signal for the beginners, while price action confirms it. If a trader notices that the volume is low, he must realize that the trend is going to take a reverse movement or that it is dying. Or the trend is about to take a break before it continues its journey. The trends in the Forex market are dynamic in nature. Even the experts in the Mena region can’t predict the Forex trend with zero errors. The best you can do is to analyze the most important metrics to improve your forecasting ability.
If a high volume is noticed right after a low volume, then newbies have to realize that it is a perfect time for scalping. To realize the relationship between this volume and price action, traders need to study more about them and be patient.
3. Exponential moving average
This is a popular strategy in the short-term trading style because it provides a quick result, and this EMA is one of the simplest indicators for beginners. To identify the market’s condition, you must observe the line of the existing market and the line of the indicator. If the current market stays above the EMA line, it is time to sell the financial instrument. The same is the case for the opposite move. You can also get two or three lines by choosing different timeframes like 50-days, 100-days, or 200-days. One can utilize this EMA indicator to identify the perfect buying or selling points from the chart.
4. Trendline and stochastics
This strategy is a combination of these indicators – stochastics and trendline. The stochastics will measure when one currency is oversold or overbought. The value will indicate the condition of the industry. More than an 80 value suggests that the instrument is oversold, and a value of more than 20 indicate that the instrument is underbought. Try to draw the trendline to determine the approaching flow of the currency’s price. One can easily find out the possible sell or buy spot by analyzing the crossovers of the trendlines.
5. Static and dynamic resistance and support
Simply, static resistance and support levels start at the beginning of a day. While the dynamic ones keep changing their values based on the ups and downs of the prices. The areas where these dynamic and static levels are met are regarded either as a buy or a selling point.
These are the five most profitable business strategies for Forex scalping.