Scalping
What does it mean?
A that attempts to make money on small price changes. Traders who use this strategy will place anywhere from 5 to many hundreds trades in a single day in the belief that small moves in forex currency or stock price are easier to catch than large ones.
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Forex scalping is not for every trader. The returns generated in each position opened by the scalper is usually small; but great profits are made as gains from each closed small position are combined. The scalper needs to be a patient, diligent individual who is willing to wait as the fruits of his labors translate to great profits over time. An impulsive, excited character who seeks instant gratification and aims to “make it big” with each consecutive trade is unlikely to achieve anything but frustration while using this strategy.
Scalping also demands a lot more attention from the trader in comparison to trend following. A typical scalper will open and close tens, and in some cases, more than a hundred positions in an ordinary trading day, and since none of the positions can be allowed to suffer great losses (so that we can protect the bottom line), the scalper cannot afford to be careful about some, and negligent about some of his positions. It may appear to be a formidable task at first sight, but scalping can be an involving, even fun trading style once the trader is comfortable with his practices and habits. Still, it is clear that attentiveness and strong concentration skills are necessary for the successful forex scalper. One does not need to be born equipped with such talents, but practice and commitment to achieve them are indispensable if a trader has any serious intention of becoming a real scalper.
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Some traders say that scalper make brokers rich.