Scalping, also known as picking, is the most short-term Forex trading strategy used in the Forex market. The traders and investors that use the scalping strategy are known as scalpers. Scalping has become more and more popular over time.
Scalpers do not look to make any significant amount of money per trade, since they make a considerable amount of trades each day. In fact, just a few pips of profit per trade is enough, for a trader or investor using the scalping strategy. This is because, due to the fact scalpers make many trades per day, each small profit they manage to make per trade all adds up. Depending on how many trades a scalper makes per day and how much profit each trade deduces, scalpers can gain significant amounts of profit. However, a scalper’s success will also depend on their broker’s efficiency in filing their orders, as well as the spreads that their brokers can provide.
Because a lot of traders and investors who use the scalping strategy make very short-term trades, some trades only lasting up to a minute, brokers often struggle to keep up. Scalpers tend to place orders on their positions before their brokers even have enough time to fill their first orders. This can lead to brokers actually losing money from certain transactions made by traders and investors using the scalping strategy. However, Forex brokers have gotten faster and faster with filing orders made by traders and investors, meaning that scalping is no longer as much of an issue as it once was. But still, some brokers do limit the amount of orders you can place per day, in order to avoid or at least limit the use of the scalping strategy by traders and investors.
If you are interested in scalping, you will need to find a broker that does not discourage the use of the strategy. You will not find it difficult to find brokers that support scalping, since the currency market has grown considerably in recent years, particularly online. You will also need to think about using a broker that can provide lower spreads. This is because you will be making many trades per day when scalping, aiming to make only a few pips of profit per trade, so a high spread will greatly restrict your chances of being profitable.
In conclusion, scalping is a very short-term trading strategy used by many traders and investors in the FX market (who are often referred to as scalpers). Scalpers pay a lot more attention to Forex market movements than other traders and investors. By watching the market as continuously as they do, scalpers can spot very short-term trends and take advantage of them quickly (in order to make a quick few pips of profit). Scalping can present a fantastic opportunity to Forex traders and investors, with some scalpers making very significant profits despite working with brokers that provide particularly high spreads. With some practice and an efficient, low-spread broker, you could indeed make a lot of money.