This post has been selected as an answer to the original posters question
Throw in slippage, limit orders not filled at time target,and the scalps gone wrong and it doesn't sound as appealing.
But as you say if your win % is good enough then you could override your brokers fees.
One appealing thing i find about the scalping concept is that you limit your exposure to the volatile moves.
I scalped well on SIM but in real time it was much more diffulcult.
I find order flow trading appealing as it focuses on short term moves but lets the runners develop.
Kind of like a hybrid scalping methodology.
There are some good vids here about order flow.
"less than 1 point " implies a profit target of 2 or 3 ticks
given that, what would your stop loss be on the trade ?
the larger your average stop loss, the greater your win% will have to be.
For example, lets say you use a 1:1 risk:reward profile and try for a 3 tick profit target with a 3 tick stop loss. In this case, your average winning trade nets you 2 1/2 ticks of profit after broker commissions and exchange fees. And your average losing trade costs you 3 1/2 ticks (including comm & fees). So in this case your winning percentage would have to greater than 60% to show any measurable profit.
Taking this one step further, let's say your trading 1 ES contract per trade attempt, and you can produce a 60% win rate with the 3 tick profit target:3 tick stop loss strategy. In a typical trading day perhaps you take 10 one lot scalp trades netting $37.50 (=$187.50 net profit - $150 net loss). So to achieve your "3 or 4 points" profit per day goal, (3 ES points = $150), you would need to trade a minimum of 40 contracts per day (where 40 contracts =$150 net profit per day / $3.75 net profit per contract). So you will have to figure out how many valid trade setups you see in a typical trading session, then work that number into your equation to figure out how many contracts per trade would be required to net out $150 per trading session.
Be Patient and Trade Smart
The following 3 users say Thank You to trendwaves for this post: