Definition – What does Scalping mean?
Scalping is a method of forex trading where the trader tries to capture profits from small fluctuations in the value of a currency pair. Scalping usually requires the trader to place many trades, most of which will only be open for a short period of time.
ForexTerms explains Scalping
By collecting small profits on multiple trades, a scalper hopes to make the profits of a large trade while minimizing the risks that come with depending on a single leveraged trade.
A scalper works on the smallest timeframe of all forex traders, sometimes opening and closing hundreds of positions a day – meaning an average position will be held for five minutes or less. As such, scalpers are highly dependent on technical analysis and usually employ trading software to identify signals and even enter and exit positions automatically.