Scalping EAs start to heavily annoy Forex brokers

As Forex traders get more savvy in programming custom indicators and trading robots, the pattern of the prevailing interest to Forex scalping opposing to other trading methods is very evident; many trading Expert Advisors are based on scalping tacticks.

This tendency cannot leave Forex brokers without worries. There are still many of them who keep accepting all trading EAs, but other brokers already took or are taking measures to protect themselves from successful scalpers with automated scalping robots.

What it means to us, scalpers, if we want to use a scalping EA.

Below I'd like to give some tips and warn about possible pitfalls when it comes to using automated trading with a scalping EA:

1. Be sure to read the Term & Conditions when applying for a trading account. Look for such words as "scalping" or "snipping" and trading conditions applied to it.

Don't complain later if you missed it and caught with a scalping EA.

2. Do ask your Forex broker directly how they treat scalping as well as scalping EAs.

Some brokers have a requirement for a minimum time of holding a position open (30 sec, 60 seconds etc), yet they would tell you that scalping is still allowed. But they may not tell you about the limits, if you don't ask correct questions.

3. Ask if there are any penalties in stock for you if you're found as a scalper.

Forex brokers don't hesitate to apply very high penalties to scalpers, where usually a scalper is stripped off all his profits up to 80% at once.

4. Be aware that Forex brokers know about major scalping EAs, such as FapTurbo, for example. So, if you're after buying this robot, keep in mind that you'll have a very limited to none choice of brokers you can trade this robot on. (Btw, the mentioned robot requires 1 pip fixed spread, which is not widely available, normally you'll find it with some limited number of dealing desk brokers, but many of them aren't trustworthy at best).

5. Be also aware that Forex brokers have capabilities to recognize new scalping EAs, which, if found to be harmful to their financial well-being, could be easily counter traded to the disadvantage of a scalper.

6. The worst case scenario, however, (beside penalties) is when you're identified as a scalper and put on a manual execution with a broker; or, if there is no dealing desk to put you on, a broker can still put you on a automated simulated dealing desk, which virtually does the same thing - delays your orders, re-quotes, increases spreads etc, e.g. does everything to make your scalping EA fail.

I hope this gives you an idea how challenging it could be to trade with a scalping EA under such close monitoring from brokers.

I forgot to mention that many scalping EAs require fixed spreads, because there is a strict money management requirement in the base of a scalping robot in order to give it a winning edge.
Fixed spreads can be found only with market makers (brokers, who trade against you and don't want to see you winning too much), and with STP brokers, who route your orders to the largest market makers (although an STP broker cares less about your winning trades, it still cares because of a partnership relationships with a marker maker, and that's what counts when it comes to winning large amounts of money by scalpers).

As you can see, having a scalping EA is not always enough. A scalper also needs to be a smart sophisticated trader to be able find a suitable broker (with scalping it is better to seek acceptance from ECN brokers) and create an EA that wouldn't "bug" any side, yet make fair profits for a scalper.

Good luck!

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Scalpers take a hit from Forex brokers

If you intend to scalp Forex, I suggest you thoroughly learn the trading terms of your Forex broker. Even if you find nothing being mentioned about scalping, do ask your broker next direct questions: "Can I scalp with your company?", "Do you have any requirements about minimum time one should hold a trade?", "Do you have any restrictions on scalping, anything I should know about?" and so on.

It is in your sole interest to know the Rules and restrictions on scalping Forex. Why?

If you make profits and a broker concludes that you have made it in unethical way, e.g. by scalping, which is not allowed (by this particular broker), you will be denied in withdrawing your profits and your account balance will return to the initial deposit sum...

Funny thing is that you can discover this only when you first time ask for a withdrawal. Which means that you can trade for several months in a row, putting your time and efforts to earn profits, and then once you decide to take the money out you'll learn that your trading style was not accepted by your broker... That's painful both: money- and time wise.

So, don't take it simple if you want to scalp. Not all brokers, but some may never warn you about unaccepted trading style of yours, because you may lose money and then there is no need to warn you.

If you are already scalping and not sure if you're allowed to do so, try to withdraw some money just to make sure everything is alright.

Good scalping everyone!

Scalping Forex with Camarilla pivots

Camarilla pivots or Camarilla equation method offers some new trading opportunity to Forex scalpers. Camarilla equation method is based on predefined support and resistance levels and has clear rules of where to enter, which way to enter, where place stops etc.

It looks this way:


The idea is that you are able to scalp counter trend whenever price hits Level 3. Remember to take small profits. But when price goes through Level 4 you scalp with a trend. Don't be greedy, take small profits there as well.

A bit more detailed explanation here: How to trade with Camarilla pivots.

After adding Camarilla pivots to your charts (mt4 indicator can also be downloaded from the source above), go to either 15 or 5 min or 1 min chart.
You'll notice that Camarilla pivots are not always obeyed by price. Don't worry. The main trick is not to hurry up with the entry, but rather wait for candlesticks to signal a reversal. Study some basic candlestick reversal formations if you need to.
This Candlestick reversal source may help.

Scalping with Camarilla is an option if you are up to trading a new Forex trading stuff.

As always, happy scalping!