The Forex market is one of the very most challenging places to make a buck, and even the most successful traders in the business will lose with some frequency. The degree is something that many can curb, but the occurrence in its entirety, and accepting this fact is your first step in moving forward. Being wrong sometimes is a given, but how much you lose for your mistake is completely within your control, and you should decide how much you are willing to wager before you enter into any trade. For most this is going to involve a risk of not more than two percent of their overall account on any one trade, and while this is a hindrance at longer time frames with day trading, for scalpers is a necessity.
Taking advantage of a scalping strategy will involve a good deal of your time and attention; this is a type of trading that you must sit with. If you are not prepared to actively monitor your trades this is not the system for you, and you had better accept that now. Tools of the trade for scalping the online forex exchange include Fibonacci levels, support and resistance levels, and daily pivot points for the day in which you are trading. It is by establishing these three levels that you will be able to determine where the high odd trading opportunities are located. Without these tools in place you are shooting in the dark, and while other systems might work out alright this is one that has been tried and true time and again.
The first thing you need to do when scalping is choose the currency pair you wish to trade, the best way to do this is to choose a pair that has high volatility, but not so high that you will be stopped out at every turn. For most this usually means the GBP/JPY pair, which is also known as the dragon. After you have chosen a pair other than the dragon it is important to establish whether the trend is ascending, descending, or sideways for the pair in question at the time you decide to trade. This is established through swing highs and trend lows that are active in conjunction with trend moving down or up overall. A swing high or low is a temporary reversal in the overall trend, and its strength is determined by the number of days it reversed for prior to continuing up or down.