Trading the lower time frame is extremely risky. Those who are relatively new to the trading profession are always losing money by executing trades in the lower time frame. Unlike the novice traders, the experienced traders in the United Kingdom always execute trades based on higher time frame data. Even after having enough experience in the retail industry they never risk any amount that you can’t afford to lose. Some of you might think to use the expensive trading system from the pro-UK traders but do you think you can make a profit? You must create a balanced trading system based on your personality. Let’s find out the perfect way to create a simple scalping strategy.

Trading the 5 minute time frame

Being a scalper, you might use a much different time frame but today we will teach you the proper way to trade the 5 minute time frame. Before you start to trade the real market, make sure you develop your trading skills by using a demo account. In the 5-minute time frame, you will get tons of trading signals and it will be almost impossible to make a profit. But there is a small tweak to this system. Before you look for potential trade setups in the 5-minute time frame, you have to find the key support and resistance level in the daily time frame. Mark your potential trading spot and switch back to the 5 minute time frame to filter out the best possible trade setups.

Use of price action signal

Dealing with the 5-minute time frame is extremely risky. Most importantly you have to use the Saxo online trading account or else you will face heavy slippage in the volatile market. Once you have ensured a professional trading environment, it’s time to look for the potential price action signal. Never think you can make a huge profit from this market without having proper knowledge of this market. Try to use the reliable price action confirmation signal to execute the trade. Some of you might take a huge risk to make more money from this market but this is wrong. You might win 80% of the time using the price action confirmation signal but there is no assurance you will become successful at trading. Always be prepared to lose trades.

Dealing with the risk-reward ratio

Being a scalper, you might think you can make a profit by trading the market with a 1:1 risk-reward ratio. No matter which trading strategy you follow you must trade the market with 1:2+ risk-reward ratio or else it will be almost impossible to make a profit in the long run. Though the experienced traders might scalp the market with a 1:1 risk-reward ratio but you need to consider their skills. As a rookie trader, you will not have the ability to improvise your trading strategy. So, always remember to trade the market with 1:2+ risk-reward ratio and this will make things easier.

Managing the risk factors

As a scalper, you must have strong knowledge of risk management policy. The new traders often think scalping is done based n gut feelings. But in reality, this is one of the most complex tasks in the trading profession. Without knowing the associated risk factors in trading, it will be nearly impossible to make a profit in the long run. Trading is more like finding the best possible trades with managed risk. Focus on your trading skills and try to create a simple logic so that you can make a profit without having stress. If you lose a few trades, never become frustrated. Consider the losing trades as your business cost and wait for the next trading opportunity.

Scalping is an art. If you want to become a professional scalper, you must follow the above tips in this article. If you ever get confused with your trading strategy, feel free to seek help from the trained traders.