Category : Software
Today, effective trading consists in how fast you can react to the smallest changes in the market. This indicator is very important in formation of speculative yield, because the markets have become more liquid and volatile, and the period of “cheap money” has been going on for more than 10 years. Every fix api trader must adjust to the current market situation and have in his arsenal several tools in the form of scalping trading strategies (https://tradingsim.com/blog/scalp-trading-active-investing-strategy/ ).
Scalping is a kind of speculative trading, which consists in opening trading positions for a short time, which can be only a few seconds. This trading strategy requires high market volatility, which can be caused by a news background or by the presence of a number of trading signals (https://1sforexsignals.com/ ). Typically, this approach is implemented with the help of trading robots, which help fix api trader in his search for these moments.
So, we already understood that the scalping requires a news background, which will create an increased reaction in the fix api forex market, as well as the presence of strong trading signals. Already knowing this, you can create a simple scalping strategy. To do this, we divide them into two types:
- News scalping;
- Signal scalping;
This type consists in opening of speculative positions at the time of publication of the fundamental indicators and other macroeconomic data. When the movement of the market is not normal in the form of increased volatility, the scalping trading robot can speculate on this by opening a series of transactions for both buying and selling. As a matter of fact, it is a news robot, but after all, it works in such a scenario. A more complicated algorithm will consist in a directly analysis of the data obtained and, based on this information, in opening transactions for purchase and sale of the financial asset.
This is the most popular form of algorithmic scalping approach, which is used by the absolute majority of exchange speculators. The essence is very simple – you have to open transactions for purchase or sale only at the moment when all the trading signals are triggered. I focus on the fact that the most effective will be the application of 3-4 signals. Do not create a huge amount of analysis of different patterns and technical indicators. On the contrary, this can cause belated signals. It does not matter on the basis of which tools it will be implemented. Each manager determines this parameter. The main thing is that it was a working tool. The most important is the creation of qualitative risk and money management rules so that the robot can monitor these parameters and not go beyond the established percentage of risk.
Proceeding from this, it is possible to single out the key advantages and disadvantages of the scalping strategy.
- Yield is formed thanks to the number of opened deals;
- Short retention of the positions does not cause a deep drawdown and, as a consequence, it retains the risks;
- It allows to combine this approach with the other strategies due to the differences in the internal logic of the work, as well as the time period.
- It can be accompanied by a large number of unprofitable positions, therefore, the intervention of the fix api trader is necessary to control the risks;
- No long-working algorithms that need to be constantly automated and as a consequence the robot cannot fully operate in a regular automatic mode;
- Speculative trading is accompanied by minimal trading indicators.
These two simple types of scalping trading systems are quite easy to use in the financial market, and also to implement in the form of an algorithmic approach. I would not single out this approach as the main one in the work of the manager on the financial market, because the main yield is formed on large trends and timeframes. However, as an instrument for diversifying my trading, I think that the trading robot should be based on a speculative algorithm.