To trade in financial markets, traders use various methods. Every day the speculator begins with an analytical forecast of quotes. This allows you to identify the direction of movement of market prices, in the future to use them to open positions.
Depending on the situation in the financial market and its participants, the trader applies a suitable strategy for work.
All transactions differ in three types:
- Scalping or short-term positions.
- Transactions in the middle time range.
- Long term positions.
The fastest way to profit from Forex is to use deals with a short time interval to use in trading.
What is scalping?
In trading, traders use pipsing to quickly get profit with low profit. Scalping or, as it is also called, pipsing is a slang term. They denote quick earning points in a short time. Strategies developed on their basis always bring the speculator a small profit on each transaction, however, in the total ratio, he gets a good profit.
Pipsing is always used by traders for intraday trading. In one day, professionals open several hundred positions. In the stock, foreign exchange and commodity markets, a special tool is used to work with short-term transactions - an exchange cup, which displays the volumes of open and future positions. It also sets the values ​​of market quotes and indicates the number of lots for each level.
Scalping by “glass” in trading on financial markets is a fairly common trading method and allows speculators to consistently earn a small number of points.
Features scalping trading strategies for the "glass"
Short-term deals have their own characteristics. In scalping “glass”, special technical indicators are used that show the volume of market positions at each quotation level. Based on these indicators, traders decide to open an order.
All scalping strategies have the following features:
- A small time range for each transaction.
- Low yield, most often a few pips.
- A large number of orders in one trading day.
To earn more profit, the trader has to make a large number of speculative operations.
The advantages of short-term trading
At Forex, scalping by glass is popular among traders. Of course, first of all, you need to learn how to use it correctly, choose a strategy and work it out.
Advantages of scalping:
- Stable and high earnings.
- Short-term transactions.
- Quick profit.
- Fundamental analytics is not required to open positions.
Beginners using scalping on the glass perform several dozen trading operations per day. As a result, although a small profit is obtained on each transaction, in the amount they often overlap the income from long-term transactions.
In addition, most scalping traders are attracted by the possibility of quick money. Not every speculator, especially a beginner, will want to wait for a profit for months. They are much more interested in earning income quickly and daily.
A great advantage of scalping strategies is that in trading you do not need to apply a fundamental analysis of market movement and you can use only graphical and technical methods. For scalping strategies by glass, it does not matter where the market will go in a few months, the main thing is to understand its direction in the coming minutes. Therefore, all traders using this method use only technical analysis and graphical constructions in trading.
Disadvantages of scalping on the "glass"
In addition to positive characteristics, pipsing, like any other trading technique, has negative aspects.
Shortcomings of short-term deals:
- Frequent losses.
- Mistakenly open positions.
- There is no way to more accurately apply the analytical forecast.
- Great psycho-emotional and physical stress.
Professionals advise beginners to take mandatory breaks after each hour of work. This will help relieve eye strain and increase alertness and observation. Due to the constant emotional and psychological stress, the trader quickly becomes tired and begins to make mistakes.
Frequent losses and incorrectly open positions occur due to the fact that the speculator can not always correctly predict the change in quotes. The financial market is constantly on the move, and the smaller the timeframe, the more difficult it is to analyze. Market noise and interference give false signals, due to which the forecast is incorrect.
As a result of the combination of all factors, the trader receives losses on transactions. The more experience he has, the more stable and profitable his speculative operations.
What is a stock glass?
A variety of tools are used to work in the financial markets. The stock market is a list presented in the form of a table in which limit orders from all market participants are displayed. In other words, this is a special tool for trading, where you can see buy or sell orders.
To work on the stock market , special trading strategies are used. Additionally, technical indicators showing vertical volumes can be used. Scalping on the “glass” using specialized tools as filters of false signals almost always brings the trader a stable profit.
Analysis of quotes for the "glass"
Using this tool, you can track the mood and state of the market, that is, who is more on it: buyers or sellers. In the "glass" displays the applications of the players, which allows the trader to explore it. The analysis of the “glass” in scalping is a very important parameter, on which it depends on whether the speculator can earn money, as well as the amount of profit.
In trading, it is used to analyze the statistics of placed and closed transactions, to determine the rates of large players, the size of the spread and other important characteristics, on the basis of which decisions are made to open positions. All applications are divided into 3 groups, based on which quotes are forecasted.
Stock Market Analysis:
- Large applications from 5 thousand contracts, they need to be monitored most carefully, since these are very significant positions.
- Average indicators - within 500 contracts, have less impact on quotes.
- Small applications - no more than 50 contracts.
During the analysis, the trader considers the relationship between active and passive orders. Large players, changing the direction of quotes with large volumes of contracts, submit “aggressive” bids. Periodically in the market, with the help of passive applications, support and resistance levels are formed.
During strong impulses and trends, the market price breaks through them and quotes in the direction necessary for it. In a calm market in the consolidation zone, a rebound from the levels occurs. These parameters are taken into account by traders when forecasting changes in quotations and the further direction of market movement.
Description of the trading strategy
To open short-term deals, beginners are trained in scalping on a glass if they are going to use this technique. It begins with a study of the laws of the financial market, its fundamentals, forecasting and selection of trading tools. After obtaining the necessary knowledge and training in the proper use of the stock exchange glass, you can choose a trading strategy and pre-test it to achieve stable positive results.
Description of the trend trading strategy for scalping using the "glass":
- Indicate the levels of "support" and "resistance" on the chart. The lines are drawn along the tops and bottoms of the candles, in the places of their greatest congestion. A strategy can be used when there are strong impulses or trends in the market.
- Now you need to wait until market quotes touch the inclined (trend) line at its third point and you can open a position in the direction of the impulse.
- A protective stop loss order must be placed beyond the trend line.
Prerequisite: in the chart window the instrument “glass” should be simultaneously displayed, where orders will be visible, and the movement of market quotes.
Scalping Platforms
To work in the short-term market, traders use special programs called trading floors or platforms. The most popular speculators are MetaTrader 5 and Quik. They differ from each other and have their own characteristics.
The MetaTrader 5 trading platform is an updated and improved version of the MetaTrader 4 platform. Currently, most traders prefer to trade on it. On the one hand, its functionality resembles the previous version, however, there are also innovations on MetaTrader 5, for example, such as the “Price Glass” tool, which MetaTrader 4 did not have before.
When hunting for a trend, scalping according to statistics allows you to earn greater profits compared to other trading strategies. On this platform, the stock market can be found in the “Market Watch” section. Next, go to the “Tools” tab and select “Price Glass”. As additional settings, you can set “One-click trading”.
Scalping on the “glass” in Quik - setting up the platform:
- open the Settings tab;
- then "Basic";
- further “Trade” and “Orders”, remove the daw from the confirmation of requests;
- “Parameters” - “Settings” - “Advanced”, check the box for visibility of orders and deals on them;
- in the "Edit table" section, check the box so that the toolbar, quick entry and rejection of applications are displayed.
Trader Reviews
On forums and specialized resources, you can find the most conflicting opinions from both beginners and experts. Basically, the feedback from traders is positive about scalping by the glass. Many of them believe that it is not just a useful tool, but a necessary and significant element for profitable and full trading. Professionals advise using the “glass” in trade only after mandatory testing, obtaining positive results and fixing them in practice.
Negative moments all traders, without exception, include high voltage and fatigue during trading using the scalping method.