GMBing wrote:I'm an open minded person but nothing has been said to make me believe scalping is a good trading platform or even to dispell the overwhelming evidence that it is not.
G
Try scalping the Australian markets (ir-respective of the price, trend, and volatility of the front runners)....it's as easy as falling off a log. I could do it with my left hand, half-asleep, patch over my right eye, and still churn out a small profit and maintain a good strike rate. I don't even look at graphs, charts, volume, traded range, live pictures, commentary etc etc....just ladder, nothing else. Smooth and steady!
I'm not implying that it'll work this way forever or will remain this easy for long but it does currently because it is a much slower moving market and less competition. Ultimately, as this market evolves this seemingly easy strategy might begin to fall apart.
So there's the answer to your question - Scalping does work.
BUT - try scalping the average UK horse racing and it gets very hard (even on the ""quality"" races on Saturday's) during 'active trading time' (10 to 0 mins pre-off). You could wait until post-time until volatility drops a bit (but so will the fill-rate) and nip in for a tick or two once you know that big money has filled its belly and has moved out.
Also, the influence of big traders (you've seen them big amounts appear, disappear, and dictate price movements) on UK racing is very prominent. These traders are 'Dictators of the Market'. They kick off trends, cause sharp reversals, hold price, and possess the power (i.e. money, balls, and temperament) to 'shape' the market.
From my own experience, I tend to look for consummate profit (swings) to offset the loses, therefore I don't scalp much during the 'active trading period'. I have to swing it, and often try to piggy-back on the big money. Scalping too often here spells trouble for small money.
So to answer your question again - Scalping doesn't work too well (or at-least is not lucrative enough) in this market.
But I try my own little variation here, quite often I don't fit in the 'win' market (dense volume market like grp races on Saturday's), but by raising my stakes I can fit comfortably in the 'place' market for the same race (even though the liquidity may be much poorer). So it is there that I may have to look for scalping.
It's just as Euler mentioned earlier - some strategies work on certain markets, but not on others.
To add to that, I would say knowing how big (or small) you are in the market will help you determine if you can make a strategy work or not.
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