KAMIKAZE SCALPERS
I think that is it worth mentioning here that there are people that I would label
as “Kamikaze Scalpers”. This IS NOT something that I would endorse for
you, but will mention it here because sooner or later you will be tempted to
start thinking about it, and there are many people who do it.
Because scalping involves tiny trades (in duration and amplitude) many
scalpers trade significantly larger amounts of lots (regular or mini) to leverage
the tiny pip gains into more substantial profits. The “Kamikaze Scalpers”
might thus be risking far more than the suggested 1% to 2% per trade. I urge
you to consider against becoming a “Kamikaze Scalper” simply because the
higher your risk percentage per trade the greater the risk that a draw-down
series of loosing trades can significantly impact your trading account
negatively and make it difficult to recover to a breakeven point.
Obviously one would only consider trading like this once one is extremely
confident in their skills. Again, I recommend AGAINST you being a
“Kamikaze Scalper” but if you decide to go against my advice (which from
my experience people tend to do – and even I do from time to time) please
absolutely limit yourself to 4%.
There is another breed of what I would also call a “Kamikaze Scalper”, that
seems to have the mentality of “I’m sure I’m right”. What I’m about to
explain to you here is something that I would ABSOLUTELY NOT
recommend. I have spoken to several traders who do this and am aware that
there are trading schools that teach this approach, and despite the fact that they
claim to have overall good results with this method I’d still warn you to stay
away from doing this.
The premise behind this second kamikaze method is that most often their
assumptions of what direction the market will move in is correct but they
believe (rightly so) that a tight stop will result in stopping them out before the
market moves in their direction. What they often do is they’ll set their stop
loss order to be 50+ pips away to allow enough wiggle room to happen, but
they take their profits typically at around 5 pips. People who are very good at
these methods claim to catch 20, 30, 50, sometimes even 100 (very rare &
exceptional) successful trades in a row. What is the downside to
this? Obviously one loss will wipe out a bunch of hard earned gains. To the
people who employ such trading methods (you know who you are), if you
have been trained to do so and as long as it works for you then feel free to
continue, but for the rest of you reading this just simply DON’T!!!
Folks, don’t be a kamikaze trader. Play the game safe and you’ll last for the
long term, but if you take big risks then you soon kill your career as a trader.
forex sato

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