cowmadagan
Sergeant
- Messages
- 393
I think the biggest scalp grab I've had was 40pips, and I had two friends in the room watching. After I got out, I asked them if they want to start trading for themselves (they're now resident doctors) and they gave me a unanimous 'hell no.' I asked why, and they said it's too scary..
Fact is, it is, and should be too scary. Just ask ernest8fingers. Why do you think he lost the other two?
Unlike normal trading, you have almost no control over the exact entry and exit prices, because they're changing too quickly. That means you might try and exit after a gain of about 5 pips as it begins to look like a reversal and end in a flash between deciding to click your mouse and the execution you've actually lost 8 pips. Bigger news releases increase the chance of loss.
That said, there are six parts to standing a chance of profit.
The most important skill is finding a broker that will give you your profits at all.
The second one is finding a broker that will give you your profits from scalping.
The third is playing lots and lots and lots and lots and lots of first person shooters, because there's no one who can touch the accuracy or speed with a mouse like a hot shot first person shooter gamer. This part actually takes about six years of practice. (I started playing video games in 1984, and have been consistently playing) Hand to eye coordination, and spastic reaction speeds.
The fourth is knowing what the news means and getting it quickly. Having a TV on, your news website 'restored down' on either a separate screen or only taking up part of the screen of your broker program, and positioning it so it doesn't block the newest part of your minute chart, the deal button (prepare the number of lots if you need to before the news for a one-click deal) or your broker's feed. You should be working with constantly updating candles, or a tick chart. Knowing what it means also means that you must know the current trend, and that's part of the fifth part.
The fifth is just practice.
The sixth is high bandwidth net connection, and living somewhere important.
Here's the chart from the bullet dodging thread, and the time frame below for actual times.
The way I knew that I'd be scalping only was because the USD was gaining strength, and since I live in Asia, I'd know if NZ was under the economic circumstances to raise rates (it isn't).
Edit: It occurred to me after I wrote 'practice' as the fifth part that it's a particularly annoying word if you're eager to learn, as I'm sure Eric can back me up on, when it comes to things like meditation or martial arts. Everyone wants the wisdom now, and if you're on top of things you might even be able to notice that practice without an aim is just experience, and diligence is the crux of the lessons learned from experience.
Since I don't want to be cryptic, and there are a few nameable things I can say that come from practice, here I go. You'll notice, 95 times out of a hundred that the market spikes in the most susceptible pair before you get your news. What you need to watch for is if it's a double directional spike compared to the pre-release price or a single. If it's double directional, leave it alone unless (and until) you know at least 75% of the entire release content.
If it's in a single direction (like this one) you can assume that the market was pleased, and so you need to wait until the very first retreat begins, and the entry target is about 75% to 50% lower than the height of that spike. Here's the important part: When the spike seems to do some real slowing down and is in your favor to a degree that you should really have predetermined (I do it by shape rather than looking at pips), get out. Stay out or reverse your bet (by stopping with more lots than your original entry) if the news isn't groundbreaking (like a US NFP) or if it's clearly in the opposition of the trend. (like the NZD trade above)
Fact is, it is, and should be too scary. Just ask ernest8fingers. Why do you think he lost the other two?
Unlike normal trading, you have almost no control over the exact entry and exit prices, because they're changing too quickly. That means you might try and exit after a gain of about 5 pips as it begins to look like a reversal and end in a flash between deciding to click your mouse and the execution you've actually lost 8 pips. Bigger news releases increase the chance of loss.
That said, there are six parts to standing a chance of profit.
The most important skill is finding a broker that will give you your profits at all.
The second one is finding a broker that will give you your profits from scalping.
The third is playing lots and lots and lots and lots and lots of first person shooters, because there's no one who can touch the accuracy or speed with a mouse like a hot shot first person shooter gamer. This part actually takes about six years of practice. (I started playing video games in 1984, and have been consistently playing) Hand to eye coordination, and spastic reaction speeds.
The fourth is knowing what the news means and getting it quickly. Having a TV on, your news website 'restored down' on either a separate screen or only taking up part of the screen of your broker program, and positioning it so it doesn't block the newest part of your minute chart, the deal button (prepare the number of lots if you need to before the news for a one-click deal) or your broker's feed. You should be working with constantly updating candles, or a tick chart. Knowing what it means also means that you must know the current trend, and that's part of the fifth part.
The fifth is just practice.
The sixth is high bandwidth net connection, and living somewhere important.
Here's the chart from the bullet dodging thread, and the time frame below for actual times.
The way I knew that I'd be scalping only was because the USD was gaining strength, and since I live in Asia, I'd know if NZ was under the economic circumstances to raise rates (it isn't).
Edit: It occurred to me after I wrote 'practice' as the fifth part that it's a particularly annoying word if you're eager to learn, as I'm sure Eric can back me up on, when it comes to things like meditation or martial arts. Everyone wants the wisdom now, and if you're on top of things you might even be able to notice that practice without an aim is just experience, and diligence is the crux of the lessons learned from experience.
Since I don't want to be cryptic, and there are a few nameable things I can say that come from practice, here I go. You'll notice, 95 times out of a hundred that the market spikes in the most susceptible pair before you get your news. What you need to watch for is if it's a double directional spike compared to the pre-release price or a single. If it's double directional, leave it alone unless (and until) you know at least 75% of the entire release content.
If it's in a single direction (like this one) you can assume that the market was pleased, and so you need to wait until the very first retreat begins, and the entry target is about 75% to 50% lower than the height of that spike. Here's the important part: When the spike seems to do some real slowing down and is in your favor to a degree that you should really have predetermined (I do it by shape rather than looking at pips), get out. Stay out or reverse your bet (by stopping with more lots than your original entry) if the news isn't groundbreaking (like a US NFP) or if it's clearly in the opposition of the trend. (like the NZD trade above)
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