This article looks at scalping on the range movements of the foreign exchange Sydney.
There are a lot of traders who are more comfortable with trading in the range market than the trend market. If you are one of these traders then you should consider the use of scalping on the range market. Scalping is a short-term trading strategy that many experienced traders are able to use. It is important that you understand the use of scalping on the foreign exchange Sydney. You should also consider how you can use this strategy to trade in the range foreign exchange Sydney market.
What is Scalping?
The first point that you should consider when you look at scalping on the range market is what scalping is. If you do not understand the strategy that you are going to use you will not be able to make a profit on the market. Scalping is a short-term trading strategy where you hold a trade open for less than 5 minutes. The profits that you make in this time will be around 10 pips. Of course, this could be higher if you are trading on a stronger movement. The movement that you are looking for will be small because of the small profits you are looking to make.
Should You Use Scalping on the Foreign Exchange Sydney?
As with all forex trading strategies scalping is not a strategy that all traders can use. New traders are advised to stay away from this strategy. This is due to the high amounts of stress and pressure that comes with this kind of trading. As you are dealing with small and quick movements you have to be able to make a decision very quickly. A lot of scalpers will also look at using high amounts of leverage when they trade to ensure that the profits they are making are worthwhile.
The Analysis that You Use
When you look at scalping on a range market you are going to need to use technical analysis to find your trade opportunities. There are some traders who are able to scalp fundamentally, but this requires trend movements that you will not see on the range market. The analysis that you complete can vary from the use of technical indicators to the use of price patterns. You should choose the analysis that you are most comfortable with and that you can understand.
The Movement You Trade On
When you scalp on the range market you are going to be looking for any movement in a single direction. Range markets are made up of price movement that bounces between two levels. You should consider whether you want to scalp these movements or if you want to employ a different range strategy. If you are looking at a very narrow range then you should consider scalping. The narrow range will have very small movements and this is ideal for the scalping strategy.
Once you have found the movement that you are going to trade on you should place your trade. It is important that you use stop loss orders when you trade because the movements you trade on can turn. You should also keep an eye on the trade that you have placed.