Best Scalping Trading Strategy: The Simple Scalping Strategy
Thanks for stopping in! We've had many requests for the best scalping trading strategy over the years. We decided to get on board and give you an easy scalping technique. We think this is the best scalping system you can find. The strategy is called The Triples S or (Simple Scalping Strategy). The Triple S is easy to learn. With practice, it will become a great addition to your scalping strategy. It could even be the best scalping method you have. This strategy is included in our best trading strategy series. We created this series to help traders become successful.
While many of our favorite strategies focus on maximizing your potential for big gains, scalping focuses on finding many small gains within a short period of time. Rather than focusing on the quality of trades, scalpers are much more concerned with quantity.
What is Scalping?
Scalpers can make thousands of trades within a given trading period. There are three characteristics of scalping strategies: short positions, small profit margins, and high levels of leverage. Scalpers attempt to target price gaps and other short-term trading “loopholes” that allow them to quickly turn around a large position for a profit.
In order to find the opportunities for scalping, you will need to begin by selecting a few key technical indicators. These indicators can help you determine when short-term price gaps are likely to happen.
Because scalpers focus on short-term positions with low-profit margins, the best scalping strategies (such as the Triple S strategy mentioned below) require some leverage. It's recommended that scalpers start with a large amount of capital. Opening and closing larger positions allow you to reduce the marginal costs of trading and maximize potential gains.
The Simple Scalping Strategy was exclusively designed for scalping. You can give it a try on a 1 hour or 4 hour time chart. Feel free to try it out and let us know how it works by commenting below!
We feel it works best with the 5 minute and 15 minute time chart. You can try this with a 1-minute scalping strategy. But we will focus on M5 and M15 charts.
This is a highly profitable forex scalping strategy that uses a very accurate scalping indicator.
The simple scalping strategy uses the volume indicator coupled with price action analysis.
Let’s talk about this indicator for a bit, shall we?
What is the Volume indicator for Forex? How does it Work?
To start, here is what it looks like:
The volume indicator could be interpreted as the “fuel tank of the major trading machine.” Some argue that the volume indicator cannot be used with trading in the forex market. This is because there is no “central exchange” so how can it be read effectively? Another argument is that the volume that you see for Forex is the “Tick” volume that occurs. This means you are not seeing the entire volume that is being traded at the time like you would with stocks.
The tick volume is measured by how much the price has ticked “up” or “down” in that particular candle bar. So the more people are getting in at the time, the longer the volume line will become. This is because there will be more movement in price action with all of those entry orders flying in. So it makes sense that the volume indicator is, first of all, very accurate, and second, it has no real lag to it. It is currently showing you what the price action is doing the number of “ticks” on that candle bar. This results in the bar looking like this:
Scalpers use volume indicators for multiple reasons. Volume and price have a very strong, short-term relationship, but changes in trading volume usually happen before sustained price movements. Paying attention to volume indicators makes it possible to take advantage of these movements before they actually occur.
Using candlestick charts can also help scalpers get a quick view of the market. Candlestick charts contain more information than simple price charts (such as daily price ranges), allowing traders to understand current price trends. Below, we will discuss our one-minute scalping strategy.
One Minute Scalping Strategy
Scalping is a trading strategy that usually works best using a short-term time frame. Contrary to position trading strategies, scalping focuses on making many profitable trades with notably small margins
Scalping is ideal for day traders and individuals who are capable of making key decisions in short amounts of time. Usually, you will not have much time to conduct a thorough fundamental and technical analysis while scalping. Moving averages are constantly changing and prices are constantly being “corrected.”
Whether you are scalping EUR: USD, other currency pairs, or other assets outside of forex, it’s important to pay attention to the details. Scalping typically occurs in 5-20 minute increments. However, if you were trying to implement a one-minute scalping strategy, volume indicators, M5/M15 time charts, and price action trends should be the first things you look at.
The key to scalping while using short time frames is to identify price changes before the rest of the market has had the chance to act. You should also be willing to accept very low-profit margins—gaining less than 1% on a given action will still usually be in your best interest. Because of this, many scalpers may implement tight stop-loss and stop-limit orders over time. Also, learn more about the best hedging strategies here.
Now, let's get to it!
The Triple S Simple Scalping Strategy Rules - Best Scalping System
Side Note** Since you are all the way down to an M5 or M15 time chart the price is very sensitive to any and all news. Because of that, I would not use this strategy 30 minutes before and after a major news announcement. To find out if there will be a news announcement just check here to confirm!
Rule 1: Apply Best scalping strategy indicator: Volume
Any trading system platform is okay because the Volume Indicator comes standard on all trading systems (platforms).
Step 2: Go to an M5 or M15 Time Chart
In this particular M5 time chart we are looking at a USDJPY pair.
What you want to look for first is if the volume indicator is showing you any trend, reversal, or stagnant price action. If the volume indicator increases, so will the price action. This is because there is a plethora of interest in that currency pair.
Once you see a drop off in the volume indicator, you know that there are fewer “ticks” and hence less interest in that trend. The strategy we want to focus on mainly is trend trading. You can use the volume indicator for reversal trades. But that’s not something we are interested in with this strategy.
Step # 3 Of the Best Scalping System is to Analyze the Volume Indicator: Look for a healthy Uptrend or Downtrend. Find pullback in Price action and wait for Volume to Slow Down or “Quiet down.”
The volume indicator should tell you an enormous amount of information. If you see the volume indicator do this:
You know that the trend is either:
A. Dying and heading for a reversal.
B. Take a break before continuing to the upside.
In this case, it took a break. There were fewer buyers and sellers at the time (traders making trading decisions). Then they picked up and continued to the upside. Our strategy takes advantage of this pullback before the price action continues upward in this example.
So in this analysis step to the strategy you need to check out the volume indicator. Based on what you now know, make a good trading decision based on the current price action.
Using our example, you should see a steady uptrend followed by a pullback/retracement phase.
Step # 4 Once you see the Volume Rise/Spike (after if slowed down) Make your Trade Decision Based on Current Price Action: Best Scalping System
This part is all up to you. There is no "line crossing," "arrow appearing" or "a small voice telling you to buy now!" You have to understand a little bit about how the price action works before you decide on your entry. Using our example, the Volume indicator shot up drastically meaning that traders are getting in on the action and thus driving the price upwards!
Take a look:
Once you see this big spike or see that the volume indicator is showing that there is some action heading your way you want to get ready to enter this BUY trade because all things are pointing upwards.
Entry/Exit Strategy for the Simple Scalping Strategy
With the current structure of this trade, it made sense that since we saw our "spike" in the volume indicator and it broke this small retracement trend we pulled the trigger and entered a buy!
Your exit strategy is simple. You go for 10-20 pips. Also, You Place a 5-8 pip stop loss. Once you are up 10 pips move your stop loss to 5 pips to lock in a small profit (unless the spread is very large which you would most likely break even then.)
This 20 pips in under 5 minutes will not happen every time, but when it does it will surely make you smile 🙂 The reason we say go for 10-20 pips is for cases like this where you see a big jump after the retracement of the main trend. You do not want to get out too early.
Consider this strategy on any of the major currency pairs and you should see some great results!
**The rules for a SELL trade will be exactly the same, only opposite on your chart. (I.E. instead of starting with an uptrend first it will be a downtrend instead)
Other Technical Indicators for Scalping Strategies
As you can see, our Simple Scalping Strategy mainly uses volume indicators and candlestick charts. We developed this strategy knowing that these indicators give traders the tools they need to make quick and precise trading decisions.
Because scalping is driven by technical analysis, you should consider using other technical indicators as well.
- Exponential Moving Averages: these averages have been specifically weighted in order to react more sensitively to recent price movements. When using EMA charts, keep a close eye out for potential “crossovers.”
- Moving Average Convergence Divergence (MACD): this trend-reliant momentum indicator helps balance 26 periods and 12 period moving averages. Despite what you may assume, the MACD can be used within any trading time frame.
- Bollinger Bands: these handy bands contain the vast majority of price movements (about 95 percent). Use these bands to help determine when breakouts and trend reversals are most likely to occur.
- Relative Strength Index: the RSI is a momentum indicator that measures levels of strength and resistance on a scale of 1 to 100. This can help limit the possible risks attached to scalping.
These indicators will help you make your scalping strategy with better confidence. As long as you are able to consistently follow our strategy and carefully include stop losses, scalping is a trading strategy that will develop naturally.
Best Scalping Strategy FAQ
Is Scalping a Good Strategy?
Yes! Scalping is one of the best ways traders can build short-term profits in any market (currencies, stocks, crypto, commodities, etc.). The major advantages of 1 min scalping is that it is less risky, it's a pure technical driven strategy, is non-directional meaning you can profit from up and down markets and can be easily automated.
What is a good scalping strategy for beginners?
Yes! The forex scalping system is one of the easiest trading techniques a novice trader can implement. The 5-minute scalping strategy will make you 10-20 pips per trade with a maximum 1:4 risk to reward ratio. If beginner traders aim for this type of scalping technique, the profits will add up over time.
What is a good scalping strategy in cryptocurrency?
A good scalping strategy in the crypto market needs to follow a simple 5 step process that aims to find the best cryptocurrencies with high levels of volatility. Click HERE to learn a 5-step scalping strategy for Bitcoin and alts.
What is a good scalping strategy for stocks?
A good scalping strategy for stocks is the OHL trading strategy, which focuses on trading the open. Scalping stocks for a living with OHL trades is simply buying stocks when the open of the day is equal to the low of the day, and selling stocks when the open of the day is equal to the high of the day.
What is a good scalping strategy for gold?
The best gold trading strategy for scalping is to only trade during the London and New York trading session which is the most volatile time of the day for gold prices. Learn how to trade Gold with a few trading tricks HERE.
What is a good scalping strategy for crude oil?
The best scalping strategy to trade Crude Oil is by using technical analysis. Oil is an overcrowded market with a lot of institutional players that leave footprints on the price action chart. Check here if you want to learn how to trade like a professional oil trader using the price chart and a combination of two technical indicators.
What is a good scalping strategy with moving averages?
A good scalping strategy with moving averages is the 9 and 30 EMA trading strategy. This EMA scalping strategy can be used across the 1-minute and 5-minute time frames. If there is an intraday trend, scalping with moving averages is the simplest trading approach.
Conclusion - Best Scalping Strategy
Simple Scalping Strategy could be a powerful 1-minute scalping system as well and if you try in on the time frame let us know your results! We could use the best scalping strategy indicator (volume) and have a whole basket of strategies to use with it. The reason is that it can confirm a trend, can confirm a reversal, and can show us when there is less interest between buyers and sellers.
With this best scalping system, you will find that it's not only easy to scalp the market but also will find a high win percentage strategy and a chance to grow your account very quickly. If you are not a fan of scalping and enjoy swing trading or day trading strategies make sure you check out the Rabbit Trail Channel Strategy that will show you how to grab 50 pips at a time with a high probability of winning!
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