How to scalp safely late in the game (attn Psychoff)?

[stueytrader]

Another way to frame a key trappy issue with scalping is the simple question: why not make this one a swing trade instead?

i.e. if an entry point is suitable, why not hold the trade longer and take more profit from it. Though scalping in many ways reduces risk (because you exit with your profit quickly) it also cuts potential profit down (less time for the movement).

[Kai]

Another way to frame a key trappy issue with scalping is the simple question: why not make this one a swing trade instead?

i.e. if an entry point is suitable, why not hold the trade longer and take more profit from it. Though scalping in many ways reduces risk (because you exit with your profit quickly) it also cuts potential profit down (less time for the movement).

But it's the volatility that creates the opportunity to scalp, so logically if you're scalping the volatility itself then you don't really need to wait for time decay to do its thing and needlessly prolonging your exposure times.

Swinging is an option if there is big value in the price in general (Rebelo style), but with scalping you can manage your risk more effectively and absorb some of that noise. Realistically, by the time you may get caught out chances are you've already done a lot of work, and you sometimes have the option of going for a goal too at the same time so getting caught may be a blessing, but if there's value on the other side then it's a bit silly to go for it.

The markets get volatile for a reason usually, so you have to get comfortable with framing all the risks, it's not something for the faint-hearted, high-risk/high-reward rarely is.

[stueytrader]

Another way to frame a key trappy issue with scalping is the simple question: why not make this one a swing trade instead?

i.e. if an entry point is suitable, why not hold the trade longer and take more profit from it. Though scalping in many ways reduces risk (because you exit with your profit quickly) it also cuts potential profit down (less time for the movement).

But it's the volatility that creates the opportunity to scalp, so logically if you're scalping the volatility itself then you don't really need to wait for time decay to do its thing and needlessly prolonging your exposure times.

Swinging is an option if there is big value in the price in general (Rebelo style), but with scalping you can manage your risk more effectively and absorb some of that noise. Realistically, by the time you may get caught out chances are you've already done a lot of work, and you sometimes have the option of going for a goal too at the same time so getting caught may be a blessing, but if there's value on the other side then it's a bit silly to go for it.

The markets get volatile for a reason usually, so you have to get comfortable with framing all the risks, it's not something for the faint-hearted, high-risk/high-reward rarely is.

Thanks for your reply Kai,

Yes, I see what you mean about relying on 'volatility' itself. This is a somewhat different matter to the reasoning for a swing I agree.

[Persis10tUser]

Another way to frame a key trappy issue with scalping is the simple question: why not make this one a swing trade instead?

i.e. if an entry point is suitable, why not hold the trade longer and take more profit from it. Though scalping in many ways reduces risk (because you exit with your profit quickly) it also cuts potential profit down (less time for the movement).

But it's the volatility that creates the opportunity to scalp, so logically if you're scalping the volatility itself then you don't really need to wait for time decay to do its thing and needlessly prolonging your exposure times.

Swinging is an option if there is big value in the price in general (Rebelo style), but with scalping you can manage your risk more effectively and absorb some of that noise. Realistically, by the time you may get caught out chances are you've already done a lot of work, and you sometimes have the option of going for a goal too at the same time so getting caught may be a blessing, but if there's value on the other side then it's a bit silly to go for it.

The markets get volatile for a reason usually, so you have to get comfortable with framing all the risks, it's not something for the faint-hearted, high-risk/high-reward rarely is.

Hello Kai,
Thank you for your post. Can you please help me to understand how to find those football matches which the most volatile are? For example if there are 50 matches at the same time where would you start? Any specific signal to focus on instead of checking them one by one?
Regards

[Kai]

Hello Kai,
Thank you for your post. Can you please help me to understand how to find those football matches which the most volatile are? For example if there are 50 matches at the same time where would you start? Any specific signal to focus on instead of checking them one by one?
Regards

Hi

Not a bad idea to start by finding value in most liquid Unders, by watching a match. IMHO 1st half largely irrelevant here, last part of the match is more interesting after Under X.5 market drops below 3.0 etc and tick increment size changes, so suddenly many ticks to play for with swings/scalps.

If you use a bit of logic regardless of sport if there is a misalignment in price (aka value) then there will be those that try to aggressively correct that price, thus potentially creating volatility because decaying markets can be stubborn in their behavior.

Plus, football markets are full of aggressive players that try to anticipate goals or try to employ clever risky ladder strategies.

Ultimate question for nearly everyone I would say regardless of sport and market, HFT traders are expected to do quite well if they find pockets of volatility etc.

[decomez6]

scalping in the closing stages of the game when strong favourites are losing could be advantageous.
This is because usually under odds tend to be quite high when strong favourites are playing, and the odds start to decay rapidly as the clock ticks.
I get this logic, however one can make the reverse argument that in such games, the possibility of a late goal is high since strong teams tend to find a way to equalise or win at the end, and in this case you'd face a massive loss.

the average traded range should be narrow and well frequented.

wisdom of the crowd: or - lack thereof , causes volumes / price flactuations which help to highlight the overbacking . this will in return produce a price anornally that is hard to contain within a book that must remain balanced at all times . as in your case everyone is witnessing the obvious loss of a strong favourite , but not willing to dump thier positions . this is an emotional tug of war which is clearly evident on the ladder .
it is then followed by a fear of missing out and panick selling which is fertile ground for some- Directional Biased scalping- especially at a crossover point.
as a scalper i i can open a position and not to have chase the price regardless if iam loosing or not, i know your favourite is about to loose and you are not willing to accept the reality ( Value) the price will always follow value , and iam the one providing it when you are trading fear for it.