Definition

A Scalping Strategy is a short-term trading approach focused on capturing small price movements through multiple rapid trades. It typically relies on tight spreads, high liquidity, and quick execution.

Scalping strategies are commonly used in fast-moving markets and may be implemented manually or through automated systems.

Example in Context

A trader enters and exits positions within minutes, capturing small price differences multiple times throughout the day.

FAQs

Is scalping suitable for all market conditions?

Scalping strategies generally perform best in liquid markets with consistent volatility.

Does scalping require automation?

Not necessarily, but automated systems are often used to improve execution speed.

Is scalping high risk?

Frequent trading increases exposure to fees and rapid price changes, which may increase risk.

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