Amazingly Simple Scalping Strategy for Daytrading Forex ( EMA + Pivots )

In this video, I am going to be sharing one of the easiest scalping strategy that I use to successfully scalp the markets.

But, before we start, be sure to subscribe to our channel so that you don’t miss on any of our new videos. With that being said, lets get into today's video.

Scalping is a form of trading, where in a trader enters and exits multiple trades during a day to make small profits. At the end of the day, these small profits can accumulate to a large number.

In fact, I have met a lot of successful scalpers who make more that six figures a year.

I am not saying that you will become rich overnight by scalping, but, if you work hard in scalping, you will likely achieve these abnormal profits.

The strategy that we will learn today is a trend following strategy. This means that we will identify the trend and look to trade in the direction of a trend. Since this is a scalping strategy, we will use the 5 minute chart to trade it. But you can also use a smaller timeframe such as the 1 minute chart to trade this.

For the sake of this video, we will stick with the 5 minute charts.

Since this is a trend following strategy, we first need to identify the trend. For that we will use an indicator called the moving average.

Now, moving average is a simple indicator that plots the average price of the asset over a particular period of time. Different moving averages show different trends.

A 200 period moving average shows the long term trend of the market. Similarly a 100 period or a 50 period moving average will show the medium term trend of the market. Lastly, a 20 period moving average will show us the short term trend of the market.

Since we are scalping, we are only concerned with the short term trend of the market. Hence, we will use a 9 period exponential moving average and a 21 period exponential moving average.

This how the moving averages look on the chart.

Here, the blue line is the 9 period EMA and the orange line is the 21 period EMA.

In an uptrend the price will stay above both of the moving averages, and the 9 period EMA will stay above the 21 period EMA . Another thing to note here is that the moving averages will be sloped upwards at an approximate 45 degree angle. The gap between the moving averages should also grow wider with each candle.

This means that the moving averages should look like they are moving far apart from each other.

For this chart, we can confirm that the price is in an uptrend, and hence, we will only look for Buying setups.

In a downtrend. We can see that the price stays below the EMAs for most of the time. And, the 9 period EMA stays below the 21 period EMA. Both of the moving averages are sloped downwards at an approximate 45 degree angle. The distance between the moving averages keeps on increasing as new candles are formed.

Hence, we can confirm the price is in a downtrend, and we will only look for selling opportunities.

In a sideways market, we can see that the price moves around the moving averages. It does not stay above or below the EMAs. We can also see that the EMAs stay flat and there are multiple crossovers between them.

There is no clear indication of a trend. Hence we will stay away in these scenarios and we will not enter into any trades.

Now let us look at the second indicator that we will use for our trading. That is the pivot points. Pivot points are simply the price levels that are calculated based on the price action of the previous day.

This is how the pivot points look.

Here the yellow line is called as the central pivot. It is simply the average of the high, low, and the close of the previous day.

The three lines above the central pivot are called as the R1, R2, and R3 respectively.

Similarly, the three lines below the central pivot are called as the S1, S2 and S3.

Often times, the pivot points can act as support and resistance levels. Hence, the price can reverse after hitting these levels. The reason behind this is that a lot of traders use the pivot points. In fact, pivot points are very popular among day traders.

Hence, it becomes a self fulfilling prophecy.
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