It's quite a complicated trading approach, but many beginners start with it. The method aims to profit from price fluctuations within the day. Some traders make more than 200 trades per day, keeping each new position open for only a few minutes. The profit from each position is quite small, but in total for the day you can hit the jackpot!
Who are pipsers and what is their difference from scalpers
Pipsers trade on intraday movements. Scalpers do the same thing, but there is a slight difference between them. Pipsing means more short-term positions - usually up to five minutes, whereas scalpers usually keep them open for 4 to 10 minutes.
On average, the currencies move by about 50-60 points during the day, if you look at the daily opening and closing prices. Though exchange rates do not always rise or fall, there are always fluctuations within the day, which gives the opportunity for trading.
General idea and difficulties
To achieve results, you must set the stop loss as close as possible to the opening price. Remember that stop loss is necessary for limiting risks if the price goes in the opposite direction.
Here lies an almost psychological trick: you can lose even because of a slight fluctuation of the price. Even if it was possible to predict further trend direction, the chance of loss is still very high, unless additional bullish or bearish forces have appeared on the market.
Plus the emotional excitement and nervousness, which are typical for most traders. Anxiety intensifies with every transaction, which usually amount up to 200 a day.
But somebody has to earn from pipsing? A hundred times no! There are no eminent pipsing traders who would show stable results for long periods.
Everyone should do some pipsing
Many traders who lost deposits pipsing say a lot of bad things about it, but they still admit to have acquired a lot of new skills that now help them with scalping or position trading. And with the development of web technologies and automation, pipsing becoming easier and more profitable.
Pipsing is the accelerator of professionalism. Perhaps you will lose money and nerve, but you will be much more organized in everyday trading. Two or three days of such self-flagellation and you are a Jedi.
Even for manual trading, you will need a trend indicator. Classical Moving Average with a period of 33 is perfect. Pipsing can be done in any direction, but it is better to start along the trend.
The moving average is crossed by price, which can serve as a signal for opening a position along with the trend
Enter the position on the price rollback. We enter along the trend on timeframes from M1 to M15. We exit at a loss of 5 points or a profit of 7. The volume of positions should take into account the movement of not more than 5% of the deposit for 1 point.
You can try to trade with experts and additional indicators. MA works well in tandem with the Parabolic SAR when pipsing.
As you can see, Parabolic SAR has confirmed the enter signal of the MA 33
- Timeframes М1-М15.
- Minimize the risks. 200 trades isn't a daily plan, it's rather a top limit.
- Quick execution is essential, therefore trade on NDD and ECN accounts.
- Pipsing should be done during calm market — the best time is night, Pacific session.
- Give preference to floating spread for quick exit and minimal amount during low volatility.
- Pipse on major currency pairs due to volatility and favourable spreads.
- This is the kind of Forex trading that will teach you to see your emotions from outside!
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.