5 minute scalping with retracement

5 minute scalping is a trading system based on exponential moving averages but the key of this strategy is the retracement. In this article we explained how to do scalping with the technique of retracement in a trendy market. This system requires discilpline, but if you learn this one well it will consistently earn your profits. The beauty of this system is that is so simple and so profitable.
Currency pairs: EUR/USD, GBP/USD, USD/JPY.
Time Frame: 5 minute.
The indicators you want use for this system inclue:
Exponential moving average (EMA 10 period, close).
Exponential moving average (EMA 21 period, close).
Exponential moving average (EMA 50 period, close).

5  minute scalping with retracement

The 50 EMA is our indicator to determine short term trend, and the 10 and 21 period ema's provide us with strong support and resistence levels which we will use for entry signal.
Sessions for trading are London and New York.
Our whole point here is to the ride out the shor terms trend while the trend is making higher highs (and lower lows) and to constantly squeeze 10 -15 pips out trade while only risking five. If you follow our entry rules this system does work well. The basic idea shown on a chart.

5  minute scalping with retracement
Trading Rules for 5 minute scalping with retracement
Look for an trend on five minute chart.This means that the currency will be making higher highs (in an up trend) and lower lows (in an down trend).
Look at the EMA 50 for determine the trend direction. The more is slanting up or down, the stronger the trend is.
Wait that the price of the currency enter the halfway point between EMA 21 and EMA 10. this is your entry signal buy or sell.
For Stops use 7-12 pips plus the spread.
Set a take profit at te 10-15 pips plus spread.
Continue the scalping until the trend stops 50 EMA turn sideways).
See the picture
5  minute scalping with retracement

In the picture there are 7 entry points. Of those seven only 4 are valid but we'll get to that.

5  minute scalping with retracement

In this case all the entry sifnal are valid The 3# trade would have stopped out, but we woul have had four profittable trades by scalping 10 pips at time from this trend.
This system is simple and if used the way we have laid it out it can be extremly profitable.
Using this method we won't making multiple trades instead we just take the first signal, set our stop to breakeven once we are 10 pips ahead, and then let it run. Using the same example.
5  minute scalping with retracement

With this method we take the first entry signal once we've determined that we are in a uptrend/downtrend. Looking at the chart above the bar hits the midway points between the EMA 10 and EMA 2. We enter the trade. We still use our 7-12 pips of stop plus spread but this time we don't set a take profit. We wait until the trade moves 10 pips in our favor and the set our stop to the the breakeven point.
To exit to the trade there are two strategies:
1 wait until the EMA 50 begins to flatten with this we have earned 50 pips.
2 wait until the EMA 50 turns up with this trade we woul have held if for most of the day and earned 100 pips. Conservative traders shoul use the first exit strategy. Risk traders can try the secon methods is it an easy way to make a big trade off the 5 minute charts.

5  minute scalping with retracement


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