Question About Scalping Stocks

Discussion in 'Trading' started by jellob, Jan 13, 2009.

  1. jellob


    I used to think that scalping is like jumping on and off the bandwagon while it is moving. How long do you usually hold a position? I have done some simulated trades, many of which last close to an hour. Even if they never trigger my stop, I have to sit and wait for the momentum to pick up.

    For example, today at 1:59, I bought WFC @ 23.93. The stock bounced around before finally moving up. I sold at 2:37 @ 24.29. Am I doing it correctly or was my bandwagon picture inaccurate? Or did I just get lucky?
  2. Momentum scalping is just one type...

    I like scalping churny thick garbage stocks for nickels and dimes. Average hold time under 5 minutes.
  3. The stock moved to 24.17, then back to entry price before finally rallying upto 24.47. I don't want to sound smart, but it's hard for me to see a thick stock like WFC go 25 cent in favor and then come back to entry price. Hence I must have booked some shares in the first bounce. If I see a good buying level, as it was 23.90 might have added more second time. But then all these are speculative strategies; for me a secondary style of trading.
    I base my scalping on few patterns on level2 and 2 minute charts which have a avg win/avg loss more than 6.
  4. jellob


    WFC does look like a thick stock, but according to my calculation from another system, it is still volatile enough. I am entirely new to scalping, deciding to take a look after reading something in ActiveTrader about leaning on a support or resistance.

    It seems to work, but I must say the mechanism is a lot more subtle. I am just afraid that I am looking at something imaginary when there is nothing happening. It looks like I have more work to do.
  5. an hour is an eternity in scalping, look up average true range, you should try to get a small chunk of the range. If the stock moves a dollar then maybe you catch .10 cents or 10%, this is just one way.

    here is a chart of GOOG today sharp rally with boring consolidation pattern, then sharp sell off. You have to figure out what is getting you in and out of a trade. A good scalper would have caught enough of the early rally to call it a day. Good trading.
  6. There was a nice post long back:

    PS: there's nice posts from FT71 too in that thread.