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5 Simple and Hassle-Free Scalping Techniques for Beginner Forex Traders

Scalping is a trading strategy that focuses on gaining small profits from numerous positions within a very short period. This strategy requires discipline, speed, and high emotional resilience. Here are five simple and effective scalping techniques, along with some important tips to ensure success in scalping.

  1. Simple Scalping Technique with EMA Crossing 
Using Exponential Moving Average (EMA) is one of the popular methods in scalping. You can utilize two EMA lines with different periods to identify buy and sell signals.

Steps:

  • Place EMA with a period of 10 and EMA with a period of 20 on the chart with a small time frame (1-15 minutes).
  • A buy signal occurs when EMA 10 crosses above EMA 20.
  • A sell signal occurs when EMA 10 crosses below EMA 20.

Tips:

  • Use additional confirmation from price action analysis or other indicators to enhance signal accuracy.
  • Avoid trading when the market is choppy or lacks a clear trend.

  1. Utilizing Volume and Price Action 
This technique uses volume indicators to recognize changes in price action. The basic theory is that volume changes are often followed by price changes.

Steps:

  • Observe volume indicators to see when volume significantly increases or decreases.
  • Use candlestick patterns or chart patterns as confirmation after volume signals.

Tips:

  • Be cautious when using volume indicators during ranging markets, as their signals may be less accurate.
  • Always wait for confirmation from price action before entering a position.

  1. Combination of Stochastic and MA 
Combining the Stochastic indicator with Moving Average (MA) can provide more accurate signals.

Steps:

  • Install SMA 50 and EMA 120 on the chart.
  • Watch for crossing signals between MA lines and Stochastic %K and %D lines.
  • A buy signal occurs when Stochastic indicates oversold conditions and the price crosses MA from below.
  • A sell signal occurs when Stochastic indicates overbought conditions and the price crosses MA from above.

Tips:

  • Use small time frames (1-15 minutes) to capture short-term price movements.
  • Avoid trading when the market is choppy or sideways.

  1. Scalping with Parabolic SAR 
Parabolic SAR is a trend indicator that can be used to identify changes in price direction.

Steps:

  • Install the Parabolic SAR indicator on the chart.
  • A buy signal occurs when Parabolic SAR points move from above to below the price.
  • A sell signal occurs when Parabolic SAR points move from below to above the price.

Tips:

  • Use additional confirmation from other indicators, such as MACD, to enhance signal accuracy.
  • Avoid trading when the market lacks a clear trend.

  1. Finding Momentum Entry with CCI Indicator 
Commodity Channel Index (CCI) is an oscillator that can be used to identify overbought and oversold conditions.

Steps:

  • Install EMA 200 on the chart to determine the long-term trend direction.
  • If the price is below EMA 200, focus on sell signals.
  • If the price is above EMA 200, focus on buy signals.
  • Use CCI to find momentum entry, with buy entry when CCI enters the oversold zone (-100) and sell entry when CCI enters the overbought zone (+100).

Tips:

  • Always use confirmation from other indicators or price action before entering a position.
  • Avoid trading when the market is sideways or lacks a clear trend.

Important Tips in Scalping

  1. Test strategies on a demo account: Make sure to backtest and forward test before applying strategies on a live account.
  2. Minimize risk: Never risk more than 2% of your trading balance in one position.
  3. Don't use too many indicators: Use only necessary indicators to avoid confusion and conflicting signals.
  4. Master one technique: Focus on one strategy that suits your trading style the most.
  5. Control the number of trading positions: Don't open positions in excess of your capital capacity and risk tolerance.
  6. Stay focused: Avoid distractions during trading and remain concentrated on charts and your trading signals.

By implementing the above techniques and following the given important tips, you can increase your chances of success in scalping and avoid unnecessary losses.

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