[subterfuge]

Isn't scalping ,buying on the bid and selling the ask? When traders 'earn the spread'? making hundredes of trades oer day? That's what I think of when i hear 'scalping'.

Im not sure what the OP means though.
He says, 'find a stock that oscillates about .1 percent and you'll make a minumum of a dollar profit every time you trade'
How so? What if you buy at the bottom of the typical oscillation and it carries on going down? 'A Trade every minute pretty much guarantees you $60 each hour'. how? What trade?

LOL.
Am *I* being stupid hear and everyone else understands his opening post?

[kookeboy]

I would think there are very few people who make a living doing this.

Really basic, I think scalping is 1:1 risk/reward. So the win:loss ratio is critical. Let's say you get 2:1 consistently. Then take out your brokerage or spread or commissions and see if it works. Or work it back the other way and see what win:loss you'd need to make to be profitable. I doubt it would stack up.

Anyone who has done this for a while says the money comes in letting winners run. Scalping doesnt achieve that.

And besides, if you are trying to set this up as a business, which does not rely on you working every single day to keep making money, then scalping isn't ideal.

[Elroch]

"Scalping" used to mean making money from the spread, as one poster said. I have observed the term get (mis)used in an increasingly different way, with people claiming to scalp off hour charts or even overnight.

In response to the first poster, what he describes sounds great, except you need to be right a lot, and it is a lot easier to be wrong and lose a pip or two on your average trade. It is true that the trading costs are important. You need a sizeable edge just to break even if you trade for a few pips.

But some can achieve results approaching perfection going for a few pips when everything is perfect, and make millions (proof by example). Good advice would be not to assume you can do this without plenty of hard evidence.

[maxr]

Sorry - content edited out as this message somehow posted in the wrong thread, and I can't find how to just delete post.

[hunter1]

I am a scalper. Trade emini. oso set for 3 tics start with a 6 tic stop loss then adjust it lower after entry is filled. usually use limit orders but not always. Also quickly adjust profit target if I dont get immediate fill. never stay in a trade longer than 45 seconds. maybe 1 minute if lunch time. Friday was typical summer day. 27 trades filled 3 losers, 1 4 tic, 1 3 tic,1 2 tic. 2 winners less than 3 tics. 80% of trades are with my trend . Have only 2 against trend set ups I will take. I use just 1 chart for trading. Use mkt profile and cycles.

A trade example is is hit VAH and get a short signal. Go short. get my 3 tics . Using MP I am expecting price to continue to rotate down Next target is either POC or a cycle point. If I have at least 6 tics room to target I go short again on next short signal..I deal stop is still above VAH but depends on entry and what price is doing. Profit target is also adjusted depending on volume at upcoming prices.

Example profit target should be 84.25 but heavy volume is at 84.50 will move to 84.50 on a short from 85.

After costs still make over $8 on a 1 tic trade so even if I just take all 1 tic trades I make $. For me this is a job so I need to make a daily paycheck. I used to trade other methods that meant staying in for the ride but I got very tired of making 15 points one day and losing 10 the next.

[electroniclocal]

Originally Posted by Yorkid »

IS there a "how" to know? If so, why aren't there a lot more scalping daytraders?

Most people just look at the price fluctuations and see the opportunity. They don't make a trading plan, they don't back test they don't do the due dilligence that a person would carry out before they start a new business. And most importantly, they assume they have the required skills without having developed/learnt them.

The competition out there is huge. People are not "entitled" to succeed. You need to earn your place in the order flow.

EL

[TheDude]

Most scalpers I know (ie taking a tick) typically take their tick 25% of the time. the other 75% of trades scratch.

The key to this is reading the order book. I've NEVER seen a true scalper use a chart (using the definition above).

Key to scalping is very low commissions. That means you are not with a retail broker - because of the high number of scratched.

Additional money is often made through exchange rebates (not available to retail traders) on those scratches.

Always good to remember gambling theory. Statistics dictate that with a 75% win rate, we have to trade 5 times before being CERTAIN of a win in a worse case scenario (assuming a mechanical type of trade management, not moving a stop etc - for purposes of a simple example). That means if your stop is 2x larger than your target, you're gunna get nailed for sure sooner or later. I'd imagine taking a string of 4 losses would be pretty hard as you'd have to get over 8 straight winners to cover the loss - and then some to cover retail commissions. a string of say 10 wins is pretty tough for most. It would take a long time to dig your self out of that hole, and if you're like most people, you'd probably jack the system in and go back to the drawing board to find another.

This is where putting the time in that EL eludes to is vital.

[Patuca]

I recently started scalping the ES. Today I took 20 trades. They varied from 1 contract to 3 contracts. Stop loss was discretionary and varied from .50 to 1.50 depending if I was directly trading with the very immediate trend or contrarian to the very immediate trend. When I say immediate trend I mean on a 1 min, 5 min, and 15 min chart. I also look at 30 min and 1 hour and daily charts for a view towards the longer trend. Here is what happened on the trades.

Total profit gross: $412.50

1) 18 winners. 2 losers ...89% win rate.
2) Average win $24.31
3) Average loss $25.00

I had 29 RT so I traded 58 contracts over these 20 trades.

Comm 145.00

Net 267.50.

I have some questions:

1) Is the reward to risk ratio as important to maintain at least a 2:1 ratio when scalping ES?

2) How do you maintain a 2:1 ratio scalping when the system I use takes 1 to 6 ticks as its profit target. Usually .50 to .75 pts is more the norm. It is hard to have a 2:1 Ratio when going for such small targets. I can't make my stoploss less or I will get stopped out too much?

3) Those of you that scalp the ES what is your average stoploss and average profit?

4) I actually scalp off the 1 hour chart but use the 30 min, 15 min, 5 min, and 1 min, for trend confirmation. But my setups are on the 1 hour chart. Those of you who scalp the ES what chart you use?

I know..the brokers like this sort of trading...but I consider simply a business expense. The only way I could lower the comm would be to make less trades and go for bigger profits but the system seems to work best taking ,50 to .75 pts profit each time and an occasional 1 to 2 pt profit.

Any ideas anyone or suggestions to me?

Patuca