What is the Scalping strategy, and why is it called that?

Scalping is a Short-Term Trading strategy. It is ideally completed in the shortest possible time: Holding the position open can last from seconds to minutes.

Scalpers complete many positions in a day to consistently profit from incremental price movements of the traded asset. They can trade manually or automate their strategies using specialised trading software. A scalper tries to profit from the bid-ask spread and exploit short-term price movements.

"Scalping" has a dark history: It was the reward paid to American settlers for each Native American scalp they cut off and delivered to authorities. The Natives later returned to the practice with even greater ferocity, and the English then paid the Natives for each "scalp" of American rebels. In other words, the term Scalping has a bad history, but in Trading, it represents being rewarded through small orders that will be completed quickly.

How to Scalp?

The characteristic traits that define a scalper are the following:

Analytical: Scalpers usually have a defined trading strategy. The number of pips they aim to "collect," the order's stop loss, the maximum time the order will be held open, the entry price, and the leverage level is well-defined in their Trading strategy.
Disciplined: Scalpers must be very disciplined to follow their Trading plan strictly. Most Scalpers set a daily loss limit and stop trading if that amount is breached. A daily loss limit prevents scalpers from continuing to lose money if they have a bad day (We all have them).
Combat-ready: Scalpers are often brutal by nature. They see the financial market as a battle zone and view other traders and platforms as enemies.
Decisive: There is little time to react to price fluctuations when making short-term trades. Scalpers often have to make decisions within seconds or lose the opportunity. They also need to decide quickly if they make a mistake. For example, do they close a wrong position immediately, or do they close half now and the other half when the profit is greater? Being a good decision-maker helps prevent a scalper from panicking.

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