Talking Points:
- Scalping strategies can be broken down into three components
- Always consider market direction and the trend
- Plan entries around retracements or breakouts
Many traders want to implement a scalping strategy,
but don’t know where to get started. The truth is, you can develop a
simple scalping strategy in as little as three steps. Today we will
review the three components of a scalping strategy. Let’s get started!
Find The Trend
The first step to scalping is finding the trend.
Finding the trend is vital because it helps create our trading bias for
a currency pair. For example, if the pair is creating a series of
higher highs, traders would only want to look for buying opportunities.
This is opposed to a graph that is moving towards lower lows, when sell
positions are preferred.
Using the example below, we can see the USDCAD
has been trending upwards with the creation of a series of higher highs
and higher lows. This means that scalpers should look for opportunities
to buy the market.
Learn Forex: USDCAD 30Min Trend
