If you are searching for a complete scalping strategy guide, you are in the right place. This article explains what forex scalping is, how a scalping strategy works on the M1 and M5 charts, and how to manage risk when targets are tiny and speed matters. You will also learn the tools scalpers actually use, the costs that can make or break performance, and a tested path to move from a MultiBank Group Demo Account to a Live Account. By the end, you will have a simple plan you can repeat and measure.
Key Takeaways
- Scalping is a fast trading style that targets small intraday moves, usually on M1 and M5 charts.
- The goal is consistency from many small trades, not a few giant winners.
- Spreads, commissions, and execution speed matter a lot because your targets are small.
- Keep risk per trade tiny, use fixed stops, and set a daily loss cap to protect your equity curve.
- Start on a MultiBank Group Demo Account, track 50 to 100 sample trades, and only go live when your stats are stable.
- Trade on MT4 or MT5, review Trading Conditions, and scale gradually on a Live Account.
What Is Forex Scalping
Forex scalping is a high frequency approach that aims to capture small price changes, usually a few pips at a time. Positions are opened and closed within minutes, sometimes within seconds, and there are no overnight holds. The edge comes from precision, strict rules, and repeatability. It does not come from predicting big trends.
Who it fits
- You can focus for 1 to 3 hours without distraction.
- You enjoy clear rules and quick decisions.
- You accept many small wins and small losses rather than holding for large targets.
How Scalping Works
Scalpers structure each session before price moves. They define the active market, the session window, and the exact conditions that trigger an entry. Execution happens on a lower timeframe, typically M1 or M5, with a higher timeframe filter such as M15 or M30. Stops are hard and placed where the idea is invalidated. Targets are modest and planned before entry. Reviews are immediate so the next trade is cleaner.
A simple workflow
- Pre session routine: mark support, resistance, session highs and lows, and news times.
- Execution: take only trades that match a written setup.
- Risk: use a fixed stop and a daily loss cap, stop trading when that cap is hit.
- Review: save screenshots and journal each trade to refine rules.
Tools Used in Scalp Trading
Charts and timeframes
- Entries on M1 or M5.
- Trend filter on M15 or M30.
- Context check on H1 when needed.
Indicators
- EMA 20 and EMA 50 to define direction and pullbacks.
- VWAP during a session to judge value, useful for fades back to the mean.
- ATR on M5 to size stops and targets.
Levels
- Prior day high and low.
- Session high and low.
- Round numbers such as 00 and 50 levels.
- Intraday structure such as micro ranges and fresh break points.
Platform and alerts
- One click trading helps with speed.
- Stable execution is essential for entries and exits. Trade on MT4 or MT5 and manage positions with the MultiBank App.
Markets, Sessions, and Timing
Most scalpers focus on liquid majors because spreads are tight and fills are cleaner. Common choices include EURUSD, GBPUSD, and USDJPY. XAUUSD is popular too, although it is more volatile, so size accordingly.
The best windows are when liquidity is highest. The first two hours of the London session are active, and the London to New York overlap is also busy. Outside those windows spreads may widen and price action can become choppy, which reduces edge for small targets.
Core Scalping Playbook
Below are three setups that are simple to learn and easy to track. You do not need more than this to begin.
Setup A: EMA Pullback
- Trend filter on M5: EMA 20 above EMA 50 for buys, below for sells.
- Wait for a pullback into or near the EMA 20.
- Enter on a strong candle that moves back with the trend.
- Stop at 1 times ATR on M5 beyond the pullback swing.
- Initial target at 1.2 to 1.5 reward to risk.
Why it works
You trade in the direction of momentum and buy value in an uptrend or sell value in a downtrend, rather than chasing breakouts late.
Setup B: Micro Break and Retest
- Mark a clear intraday level that formed during the session.
- Trade the first clean retest with a tight rejection candle.
- Place the stop just beyond the rejection wick.
- Target the next intraday level or a 1.5 reward to risk.
Why it works
You let the market show intent first, then you enter when it proves the level is respected.
Setup C: Range Fade with RSI
- Confirm a small range on M1 to M5 with clear edges.
- Buy near support when RSI lifts from the low mid zone, such as 40, or sell near resistance when RSI turns down from the high mid zone, such as 60.
- Stop outside the range.
- Target the midline or the opposite edge.
Why it works
You capture mean reversion when volatility is contained and levels are respected.
Entry and Exit Rules
Pre session
- Decide your session window in advance, for example the first 90 minutes of London.
- Mark levels and note news events that can spike spreads.
Entries
- Only take your predefined setups.
- Wait for candle closes on your entry timeframe so you avoid acting on half formed signals.
- Avoid stacking trades across multiple instruments at once, focus on one chart to reduce split attention.
Stops
- Use a hard stop that invalidates the idea.
- Size your stop with ATR or structure, then compute position size from risk percent.
- Never move a stop further away hoping the trade will turn.
Exits
- Pre plan a target and consider a time stop if momentum fades.
- Scale out is optional, experiment in your journal to see if it helps your expectancy.
Risk Management for Scalpers
- Risk per trade is typically 0.25 to 0.5 percent for very fast styles.
- Set a daily loss cap, for example 1 to 2 percent, then stop trading for the day.
- Limit consecutive losses, for example pause after three losers and review.
- Trade one instrument at a time to keep focus high.
- Log every trade with a screenshot and a brief note.
Position Size Example:
Let’s break down a simple example of calculating position size:
- Account balance: $1,000
- Risk per trade: 0.5% = $5
- Stop distance: 5 pips
To find the pip value, divide your risk ($5) by the stop distance (5 pips):
$5 / 5 pips = $1 per pip
So, you would choose a lot size that equals $1 per pip on your chosen instrument.
Costs and Execution That Matter
Scalping lives or dies on trading costs and fills. Your targets are small, so edge evaporates when costs are high.
- Spreads and commissions need to be tight.
- Execution speed helps you enter cleanly on breakouts and exits.
- Slippage happens around news, consider standing aside during releases.
- A stable platform with one click trading helps you focus on the setup.
When to Trade and When to Skip
Trade when
- Liquidity is high and the spread is normal for your pair.
- Structure is clear and momentum is smooth.
- Your setup appears with confluence, for example trend, level, and signal align.
Skip when
- Spreads widen beyond your typical target size.
- Price action becomes choppy with overlapping wicks.
- Major news is due within minutes and you do not have a written news plan.
A 90 Minute Session Playbook
- Pre market scan, mark two or three key levels, note news times, and check ATR so you know what a normal move looks like today.
- First 60 minutes, take up to three high quality setups. No revenge trading. If the first trades are losers and you hit your daily cap, stop.
- Last 30 minutes, tighten standards. Only take a new trade if structure is perfect and the setup is clean.
- Post session, save charts, record metrics, tag mistakes, and write one improvement for tomorrow.
Build and Test Your Scalping Trading Strategy
- Write your rules in a one page checklist.
- Backtest the setups on screenshots or replay to understand the pattern cadence.
- Forward test on a MultiBank Group Demo Account.
- Track win rate, average reward to risk, time in trade, and spread impact.
- Keep your rules until you have at least 50 sample trades for each setup. Only then adjust.
How Do I Start Scalp Trading
- Choose one market, for example EURUSD, and one timeframe, M5 to start.
- Pick a single setup such as EMA Pullback and write exact entry, stop, and target rules.
- Use a trend filter from M15 or M30.
- Risk 0.25 to 0.5 percent per trade with a daily loss cap.
- Take 50 trades on a MultiBank Demo Account and log every result.
- When your stats are stable, compare Account Types and open a Live Account with small size.
- Scale only when you maintain consistency for another 100 trades.
Position Size Examples
Example 1, 5 pip stop on EURUSD
- Equity 2,000 dollars, risk 0.5 percent which is 10 dollars, stop 5 pips.
- Required pip value is 10 divided by 5 which is 2 dollars per pip.
- If 1.00 lot is about 10 dollars per pip on EURUSD, position size is about 0.20 lots.
Example 2, 12 pip stop on XAUUSD
- Equity 1,500 dollars, risk 0.33 percent which is 4.95 dollars, stop 12 pips.
- Required pip value is 4.95 divided by 12 which is about 0.41 dollars per pip.
- Choose the lot size that gives about 0.41 dollars per pip on your platform quote.
Always compute position size before you enter. Do not guess. If the size feels uncomfortable, reduce risk percent and try again.
Common Mistakes and How to Avoid Them
- Entering before the candle closes. Wait for confirmation.
- Moving stops further away and hoping. Respect your invalidation level.
- Overtrading every small wiggle. If there is no setup, do nothing.
- Ignoring spread in quiet moments. Sometimes the spread is your entire target.
- Trading major news because it feels exciting. Decide in advance whether to trade news or to stand aside.
- Strategy hopping. Collect at least 30 to 50 sample trades before judging performance.
- Oversizing. If you cannot sleep, the size is too big.
Advanced Tips for 1 Minute and 5 Minute Scalping
- The M1 chart gives more signals and more noise. Use a stricter filter from M5 or M15.
- The M5 chart provides cleaner structure with slightly wider stops and targets.
- If you use 1 minute scalping, prefer the first hour of London or the London to New York overlap.
- Consider a time stop. If price does not move within a few candles, exit and reassess.
- Avoid copying equities or crypto habits without testing. FX microstructure, sessions, and spreads are different.
How MultiBank Helps Scalpers
Scalping demands tight pricing and reliable technology. MultiBank Group provides ECN style execution, tight spreads, fast fills, and negative balance protection. Client funds are held in segregated accounts under strong regulation. You can test your plan on a MultiBank Group Demo Account, review Trading Conditions, pick an Account Type, and trade on MT4 or MT5 with the MultiBank App.
Step by Step: From Demo to Live
- Open a MultiBank Demo Account.
- Choose one setup from this guide and write exact rules.
- Take 50 demo trades with fixed risk and log every result.
- Review win rate, average reward to risk, drawdown, time in trade, and spread impact.
- When the journal is consistent, open a Live Account with half your demo size.
- Keep risk small for the first 100 live trades.
- Increase size only if your stats remain stable.
FAQs
Is scalping good for beginners
Yes, if you like quick decisions and clear rules. Start on a demo and keep risk tiny until your plan is consistent.
How many trades per day is ideal
Quality first. Many scalpers take two to five good trades in a session and stop when the plan is complete.
What is a good reward to risk for scalping
Targets are often modest, so many scalpers use 1.2 to 1.5 reward to risk. Higher is possible during strong momentum, but do not force it.
Which pairs are best
Majors such as EURUSD and USDJPY due to tight spreads and deep liquidity. Try XAUUSD only after you can handle volatility and compute size carefully.
Can I scalp during news
You can, although slippage risk is real and spreads can widen. Many scalpers stand aside until spreads and price action stabilize.
What platform should I use
You can scalp on MT4 or MT5. Review Trading Conditions and confirm costs fit your plan.
Do I need indicators to scalp
No. Price action and levels can be enough. Many scalpers add EMA and ATR for clarity and stop sizing, and some use RSI for range fades.
Glossary
ATR
Average True Range. A volatility measure used for stops and targets.
EMA
Exponential Moving Average. A moving average that reacts faster to price.
Pullback
A temporary move against the trend that can offer an entry.
Retest
Price returns to a recently broken level to confirm it as support or resistance.
Slippage
The difference between expected and actual fill price, common in fast markets or around news.
VWAP
Volume Weighted Average Price for the session, often used as a mean reversion reference.