Home Beginners Forex Education Forex Trade Types Scalping Vs. Day Trading: Which is More Profitable?

Scalping Vs. Day Trading: Which is More Profitable?

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Asking this kind of question reveals one is trying to start with trading and wants to pick up the right path. Of course, profits are an end means mostly, however, the method how you get them defines you as a trader. Where one trader is profitable with day trading, the other is when scalping. To get the whole scope around this question, we would need to understand what these two strategy categories require out of each trader and other pre-requirements. Later on, we would need to tackle the way you fit in your preferred strategy to your personality and lifestyle, and then answer the question in a simplified way, but with a good punchline for every trader who wants to get something out of this game.

Scalping and day trading are trading strategy categories with an infinite number of variations, but they have something in common. They both involve positioning on forex, equities, crypto, and other markets. Now this is getting complicated, not only we have many strategies, we now have many different markets and also many different approaches. Does one particular strategy, market or approach stand out from others in terms of profitability? Certainly, but it is more about the trader behind the wheel than the strategy itself.

Before all, scalping involves shorter time frames while day trading, or intra-day trading, presumably is about higher time frames up to 4 hours. Scalping is more action-packed while intraday- trading does not have to be, yet it depends on how many positions a trader has across different markets and assets. As you can see, we are adding more and more important variables pointing to the answer to this question is – it depends. This answer does not solve anything, just makes things fuzzier. However, there are paths beginner traders can take to discover what fits them and effectively what is more profitable. 

Scalping strategies can also be applied on higher timeframes, however, these strategies deviate from what is usually considered scalping. They are more a mix of several ideas and are the result of a trader or traders looking for ways to improve on the scalping strategy they started with, all according to their life possibilities. Lower time frames require exhausting attention and it is common for traders who have developed scalping strategies to try to automate them. A robot is faster and does not have emotions that could stay in the trader’s way with this type of trading. If you do not know by now, getting emotional while trading is going to adversely affect your financial balance and your mental balance too. So, we have another variable into the definitive answer to the main question.

Anyways, scalping does not have to be automated and then it requires focus during your trading day. This attention is heavy on your body and mind, you may reach a point of saturation and even health problems regardless if your scalping strategy is working or not. Some scalpers work in a team, where the load and attention are shared, however organizing in such a way also requires traders’ goals alignment. Sometimes, successful trades establish firms and employ a workforce that can follow multiple assignments and the main trader just makes decisions. Scalping also requires certain market conditions and, like every strategy, a lot of research where it is performing the best.

On top of that, since it is usually applied on shorter timeframes, the spreads and commissions are also a factor in how profitable it can be. Therefore, research on broker trading conditions is also one of the priorities when developing scalping strategies. Certain scalpers require no more than 1 or 2 points spread to be effective long term. If we compare scalping and other, higher timeframe strategies, it seems scalping requires additional attention and research to other variables that limit them, yet they may not result in better overall performance than intra-day strategies. 

Since scalping strategies do not involve waiting, they are action-packed and fun, many young traders are attracted to them. It is like a beginner trader seeks to get emotional while experienced have set up systems that block them or just have developed skills to keep emotion at bay when they trade. Therefore, we do not advise developing scalping strategies for beginners unless you want to get into a bad emotional state after one or more accounts are down to zero and learn from this mistake first hand. Experienced traders keep an open mind and can try scalping if they see they can expand to trading ranging markets, but know they do not seek trading thrill, just better performance. 

Moving on to intra-day strategies. Now, this is a very broad category, basically, it only points at a certain time frame below the daily. Telling if these strategies are more profitable than scalping is very misleading. Yet, they are certainly less action-packed and they might allow you some screen away time. Emotions are still in, as the prices move in your favor and out so are your feelings, like a controlled roller coaster by the tides of the markets. So now we may have something cleared out, scalping strategies might be more fun but beginner traders do not have the best of chances and will learn out of mistakes, it is just a matter of how much it is going to cost them. Intra-day strategies may learn them patience, yet they are also going to be costly. 

Beginner traders simply have better chances if they learn from the start what to do and what not. There are many sources about this yet people get attracted to the fun stuff about trading such as strategies. That is why the question above is one of the most popular however it is not leading beginner traders in the right direction. Whatsmore, the internet will keep giving you the popular stuff and you may have trouble finding the right answers. Psychology and Money management topics are not popular, they are boring. Whatever strategy, scalping, or intra-day type, traders do not have a chance without the right mindset and risk/money management. 

Now we have some answers to this vague question, however, let us assume you have these two main trading pillars already developed, should you go with scalping or doing the higher timeframes? Your risk management and psychology are a part of your strategy, they are one tangible and intangible system part. Whatever your strategy type is, it is going to work out, just focus on the two main parts first. Considering strategies outside the risk management and the right mindset is like selecting a weapon to shoot blindfolded. You are going to miss most of the time whatever your choice. If we had to pick one strategy type to go with it would be trend following on the daily timeframe. Simply because trend following strategies have some proven records to perform better and daily timeframe because it eliminates some risks out of trading sessions and noise. 

Lastly, let’s mention one step traders should complete having at least some outlines of what trading style they might like and what their strengths, weaknesses, and traits are. Look out for trading personality tests online, they combine some popular personality assessments like Myers–Briggs and others with trading practices. As a result, your trading will have some weaknesses you need to work on and also strengths that should be exploited with a particular strategy. According to this test, you may try to make one that fits your lifestyle. Now, this journey requires a lot of dedication and work. Consider our other articles about how to start your way up using free resources and guides on various topics. The test result is for you only, and therefore the answer to the question that hopefully sets you on the right path. 

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