Hey guys ,
I've been reading alot of this forums since the past 6-7months and I was wondering on resorting to scalping (as it seems to suite my style) . Anyways , my capital is 50k , so i can basically buy one lot of a stock and trade it at a time .
So i was wondering would a 3% target be reasonable/ realistic ?
I dont think that i would directly get 3% as soon as I start , but after a few months of loosing money (6-8months) . Would 1.5k or 3% be realistic target ?
My motive is to substitute trading for my job . Looking forwards to commodities ,stocks and a very little trading of forex .
Asking the seniors ,
HedgeFudge
Few important things:
1. With 50K, and trading one lot --> you will be taking leverage of 5x to 8x. NOT a very wise idea.
2. Scalping is relatively difficult forms of trading. Don't think routine technical analysis will be very effective. Mastering order flow and tape reading is better route. Its easier said than done in todays electronic exchanges.
3. For scalping you need much better tools. Data feed API route would be best, but these are expensive. (for Scanning and analysing market). Knowledge of coding in Amibroker, or Ninja will come in very handy and work as alternative to API.
Every one has different perspective and strategy(a person will need to first develop his own), and it will not come precoded in any charting software.
If you are still developing and improving your strategy, getting it coded by someone else is not very effective for two reasons: One you don't know the full potential of what can be done, Second, it requires constant tweaking and improvement.
4. Regarding your 3% query, it will greatly depend on trend. Scalping on trending day might give you that, but not all days will be alike. If you read trend wrong, and flat market phases , scalping can be very frustating.
5. Scalping futures is certainly not a good place to start in markets. It would be better to first trade in less hostile environments.
6. Scalping per se appears very exciting and fun and fast paced. But not everyone is cut out for it. Requires fast decision making and huge respect for your rules and criteria. Ignoring stop loss, power failure, internet down can do quite a lot of harm. You have mentioned it suits your style. I am presuming you like it this way.....
.More importantly and counterintuitively, Scalping is more about patiently passing the frustating nontrending phase than being Rambo( jumping and shooting everything in site
).