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scalping crypto s

  #4 (permalink)

North Carolina
Trading Experience: Beginner
Platform: NinjaTrader, Tradestation
Favorite Futures: es
Posts: 644 since Nov 2011

It depends on the crypto, how you plan to scalp, and the exchange. Generally speaking, you can do limit order style liquidity provision/market making. I share a hypothetical way to achieve this in the crypto thread where you divide your account up into like many small sub lots and you treat each trade as an independent prediction. In this "naive" market making style, you must try to use some sort of technical analysis to avoid the hits. For example, instead of taking the market order, you try to take the other side of the trade (exit). Because you will take hits, you must keep your percent at risk to some minimal. For your losses, you just treat them as conversions into the crypto or if you make enough scalping then you can close them at a loss and still be net profitable. This is best if your somewhat bullish on the crypto long term and/or willing to have your capital tied up in the crypto. The percent returns can be surprisingly high from this style of trading depending on your skill level to avoid the hits but you could also end up with eventually having all "hung orders" and a net losing position too.

Other then that, it depends on the exchange. However, there isn't much liquidity so most exchanges will charge a lot more for market orders.

Generally speaking, on some of these exchanges you need to clear $10 to break even on your market orders. In that case, you need to divide your range up into $10 increments. Those would be your ticks. For example a $100 range divide by 10 gives you equivalent of 10 ticks that you could scalp. However, you must look at the liquidity available, as well.

Last edited by tpredictor; November 14th, 2017 at 07:55 PM.
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