One of the most
important techniques of trading is the Scalping Technique. The Scalping
involves the fetching of Small profits from the small movements in the price. The
small movement in the price of the Stocks when added multiple times will fetch
sufficient profits. There are many ways to perform scalping. The important ways
of Scalping includes the scalping with technical analysis. There is a choice of
many indicators which can be used to initiate the buy and sell calls.
The principles of Riskmanagement and wealth management are also very important in doing scalping. A
proper risk reward ratio is the most important part in deciding a proper plan
so that an overall profit can be generated after a number of trades. The proper
Risk Reward ratio can be decided by selecting a proper Stop Loss. The Risk
Reward ratio can be 1:1 or can also be 2:1 or any other. In case of 1:1 Risk
reward ratio the profit earned is equal to the loss earned. Thus if the trader
is following a strategy with higher number of profitable trades than even with
some loosing trades the trader will be in an overall profit. On the other hand
if the Risk Reward ratio is 2:1 the loss incurred is twice that of profit
incurred and there are high chances that the trader will end up in an overall
loss after number of trades.
The trend following techniques are useful in scalping.
Thus if the risk reward ratio is proper and the trader is following the trend
there are high chances that the trader will incur an overall profit.
The technical analysts
use the above mentioned techniques along with many other techniques to generate
accurate Stock market tips. The technical analysts generate the intraday
trading tips and equity tips based on the technical analysis conducted.
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