1-22-11; Scalp trading, can be defined as picking off small price moves in any trading instrument for profit. It can be in day trading stocks, futures, or in my case the S&P emini futures market.
It is not difficult to participate in this venture, but doing it profitably is another thing. Most traders and or investors have a difficult time pulling money out of the markets on a regular basis. It is not that they don’t have desire, but being profitable on a regular basis has a few key components to those who can.
One of those being, trading discipline. One can only have this kind of discipline if he is informed on what to be disciplined towards. If a trader has no written plan, then he is just flying by the seat of his pants and could never expect to get consistent results based on how he or she feels. You can not trade by feelings. This is different from trader insight as I call it. That would be when after long hours of price analysis, you become tuned in to the markets behavior and get a feel for the rhythm of the market.
This is being in tune with what is, not trying to guess on the next market move. Most often, the market will tell you what it is going to do next. If you are in tune with the unspoken language that it throws off each day, you will be able to time these trading entries with precision.
So, you need a written trading plan first. I have written about this before and it is essential. Then and only then, you would be able to exercise discipline to follow that trading plan. So often, we are anxious about getting what the market has to offer, but that impatience is what clouds our judgment, which creates anxiety and we begin to make rash decisions that we can hardly understand. When we look back, we are in dismay, on how did we ever put that trade on there.
It happens to ever trader, whether they admit it or not. For some it happens all to often. Our job is to keep those times to a bare minimum if we want to become the consistent traders that we aspire.
Scalp trading is an awesome opportunity to profit from the stock market participation, only if we have the discipline to follow a plan, make a reasonable amount of profit and get out for the day. As you get more experience, trading for more or take all the markets gives, can be achieved, but that does take time.
Traders are all to willing to take everything they can right out of the gate, and end up getting nothing. It would be better to tell yourself that you are only going to make two trades today, if the market presents the opportunity. That way, you know you will not be over trading.
If the first one works out, you put yourself in a no loose situation for the session. If you exercise good discipline and wait for the best confirmed entry, you will only add to the days gains and end your session.
Over trading is a big problem for many traders especially the ones who are drawn to scalp trading, like I am. We often times are drawn to the action as day traders place trades, right, so, get in their and trade. That line of thinking will hurt the up and coming trader and steal any confidence that he had, sending him back to the drawing board. Don’t let that be you. Take steps to prepare yourself and your mind for your challenges.
This part is not easy and is so overlooked it is not funny. Traders fail to plan for the mind challenges that are certain to face them. They only end up reacting to them after it is well under way, as they struggle to try and get even. This mindset ends up working against you. You are focused on the money and it now has a hold of you, to the degree that you often don’t know what to do.
If you plan on taking two trades, you limit all of those possibilities for yourself to blow up, get frustrated, get even, rack up huge commissions against your account and do a number of other destructive things. You could call it, “The One Two”.
If you have a losing trade, you may still be able to have a wining day with your next trade. If you exercise trading discipline and only take a good method trade setup, that has a 2:1 trade ratio or higher, you will still come out slightly ahead for the day.
Tomorrow becomes a new day and you get go again. This type of approach will take longer to achieve the returns of your dreams, but at least you have a chance to attain it. Most traders are going to blow up their account in 30 days or less. Don’t let that happen to you. Scalp trading as a form of income can become a reality, if you have support.
If you don’t know what makes for a great trade and have it crystal clear in your mind, you then are only guessing. I don’t need to tell you what you can expect with that approach. It then boarders on gambling and no one likes to have that label attached to them.
If you trade high percentage trades, you are not gambling. The odds are in your favor for profitable results, only if you stay in control of your trading emotions. Lose it, and you become a statistic. Maintain it, and you can make a living from the markets, which would you rather see.
Let the rush of trading go by you. Fulfill that part of your life some other way that will not affect your finances. Let Scalp trading be what you first thought it could be for you. A profitable way to bring in extra income.
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My trading results for Friday, Thursday, and Wednesday in that order. Wednesday I was sick and traded anyway, you can see I lost my concentration and took many non method trades. The indicators are not my method, by any means, but they are consistent with it. I get all my entries by price action rules of the Sniper Day Trading Method. I did recover that day nicely, but I put myself at great risk by increasing size on my last trade. All three days were profitable with Friday being my best day as far as timing and following method rules.
Enjoy the rest of the weekend to all and see you on Monday’s Post.


