Scalping is a very popular trading style because it allows obtaining multiple profits with short term trades and can be used in practically any asset and financial instrument. Likewise, it does not require a deep knowledge of fundamental analysis (although it is always convenient to take these events into account) or technical analysis. In fact, many scalping trading systems are based on relatively simple approaches.
Scalping is applied in short term time frames in which micro trends are formed that last a few minutes and require fast entries and exits. For this reason, scalping is not for traders who prefer to perform long-term trades that generate hundreds and even thousands of pips of profit, which in fact appear only a few times a month.
It is a suitable trading style for traders who can accept small gains and who are able to cut their losses quickly, as if a losing trade is allowed to run too long, it can wipe out the profits made from several previous trades. In addition, it requires the trader to dedicate the necessary time in front of the computer to carry out multiple trades per day.
Forex is an ideal market for scalping strategies due to its high liquidity and the rapid movements it produces in all time frames, including minor ones.
Free Scalping Indicator for MT4
This free modified indicator for Metatrader is designed to perform scalping trades in the main currency pairs, which have greater liquidity and tighter spreads, which makes it easier to carry out winning trades. According to the creators, the indicator does not repaint and has a profitability of around 60-80%. It is recommended to use it in the M1 to M15 time frames.
General characteristics of the Free Scalping indicator
- Currency pairs: This indicator can be used in the main currency pairs (EUR/USD, GBP/USD, USD/ JPY and USD/CHF), that is, the pairs with the smallest spreads.
- Time Frame: The recommended time frames are M1, M5, and M15.
- Trading time: All day. This indicator is not recommended for its use when important market news or economic indicators are published.
- Trading platform: The indicator was developed exclusively for Metatrader 4.
- Recommended broker: It can be used in any broker that offers the Metatrader 4 platform, such as RoboForex for example.
Buy and sell signals with the Free Scalping indicator
The Free Scalping indicator is a complete trading system which generates entry signals for short duration buy and sell trades. It displays a histogram below the price chart that produces the following signals:
- Buy signals: The histogram changes its color from red to yellow and crosses the zero line from the bottom up.
- Sell signals: The histogram changes its color from yellow to red and crosses the zero line from top to bottom.
Stop loss: The creators of the indicator recommend a stop loss placed at a distance of 5 pips from the previous candle.
Exit: The position is closed when an opposite signal appears or when the price reaches a resistance or support level.
Important note: It is not recommended to use the Free Scalping indicator during the publication of important macroeconomic news.
Probably the effectiveness of the signals of this indicator could be increased if additional filters are added, although this requires testing.
Example of the trading signals of the Free Scalping indicator
The image above shows a 15-minute price chart of GBP/USD, on which the Free Scalping indicator is being used. We can notice the different buy and sell signals that are formed when the indicator histogram changes its color and crosses the zero line up and down. The signals have a high reliability, which means that if the system is combined with adequate risk management (use of stop losses that must be respected in all trades)) and a sensible money management strategy, then the profitability in the long run can be increased to such an extent that the system produces more or less stable profits for the trader.
Download and install the Free Scalping indicator
You can download the indicator together with the template through the following link:
The indicator consists of the following files:
- Free Scalping Indicator.ex4 (indicator)
- Free Scalping Indicator.tpl (system template)
The Free Scalping Indicator.ex4 file should be placed in the /MQL4/Indicators folder of the Metatrader 4 installation on the computer. For its part, the Free Scalping Indicator.tpl file is placed in the /templates folder of the Metatrader 4 installation. To activate the indicator, the platform must be restarted.
You can write any questions you have in the comments section of this article.