A Scalping Trade That Made 400 Pips!

Scalping trades are not supposed to make 400 pips most of the time. Normally you aim for 20-50 pips per trade as a scalper. But when the opportunity presents itself and you think that the trend is getting strong in the direction of the trade, there is no point in closing the trade. Let it run as long as it can! Now in this post we will discuss a scalping trade that gave more than 400 pips. We also want to illustrate in this post news trading. We have spotted a bullish divergence on M15 timeframe. Take a look at the following screenshot. Forex Factory Economic CalenderTake a look at the following screenshot. We draw a minor trendline. Just after two candles the minor trendline is broken. We enter into a long trade at 1.27750. The stop loss is at 1.27500. So the risk for this trade is 25 pips. We continue in the trade. But the market seems to be ranging and moving little. If you take a look at the red arrow in the above screenshot, you see that EMA10 (red) has crossed above EMA34 (yellow) which is an indication of the start of an uptrend. So we continue in the trade. Now take a look at the following screenshot.Forex Factory Economic CalenderThis is the Forex Factory website Economic News Calender that we consult daily. FED Chairman Ben Bernanke is scheduled to speak at 1:10 AM on 11th June according to our local time. This is just after the midnight here. It would be afternoon or evening in US. EMA10 (red) is above EMA34 (yellow). We have no idea how to market will react when FED Chairman speaks. The price is hovering around 1.28350. We decide to continue in the trade.We just move the stop loss to breakeven i.e. we move it to 1.27750. We will continue in the trade as long as EMA10 (red) stays above EMA34 (yellow). Take a look at the following screenshot.Forex Factory Economic CalenderAs you can see, market reacted to FED Chairman speech and has moved up by 450 pips to 1.32050. We will wait for the EMA10 (red) to cross EMA34 (yellow) in the down direction which it does if you take a look at the above screenshot around the red down arrow. So we close the trade at 1.30900 making a total of 315 pips. Now if you again take a look at the above screenshot, you will observe another red arrow in the up direction. If you had been experienced, you would have closed the trade at this point as the MACD bars are also changing color at this point meaning the trend is changing direction. In this case, you would have closed at 1.31475 making a total of 370 pips. So you see with experience you would have made a better exit.

The purpose of this post is to teach you that trading needs practice and experience. Most decisions are subjective and require some experience.

2 Comments

  • ConsinaRoberts

    April 14, 2014

    Its,A,New Way,,To Trade,,

  • Jonathan

    June 22, 2015

    Hassam, the divergence master.