Definition: Scalping is a short-term trading strategy that involves making numerous small trades to profit from minor price fluctuations in financial markets. Scalpers aim to take advantage of small price movements, often holding positions for just a few seconds or minutes, and typically execute a high volume of trades throughout the trading session.
Understanding and effectively implementing scalping is crucial for traders who prefer this high-frequency trading strategy. Scalping requires quick decision-making, a disciplined approach, and the ability to consistently identify and act on short-term trading opportunities. By focusing on small price changes and executing many trades, scalpers can accumulate significant profits over time, but they must also manage the risks associated with rapid trading, such as transaction costs and market volatility.
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