Welcome to video 24 of the Advanced Forex Strategies Course. This is Cory Mitchell. In this video, we are looking at scalping round numbers. So, it is a day trading strategy, brought to you by Investoo. Even numbers are common stop and entry levels and act as magnets for price.

An example of an even number or round number is simply or any sort of level that is even. We have no pips on the end. So, here is an example, Another one would be Even numbers make it very attractive to put orders there. So, we expect to see some pops in price around those round numbers. Therefore, we can scalp a few pips profit out of the market based on that occurrence. Must use a tight spread broker for this strategy to pay off.

So, typically we want to utilize this strategy if we have a 1-pip spread or less, approximately, and best used on pairs which have at least 80 pips in daily movement.

This is an active strategy. You must be there to trade. Typically these moves happen very fast. Therefore, you have to be very disciplined to utilize this strategy.

I should say round number. Round number is a more accurate description. If the price is whip sailing back and forth across it, all those orders have been cleared. So, it kind of negates our strategy. As the price approaches that round number from below, buy when the price is about 10 pips away. If we have a big spread or the volatility is less than 80 pips per day, it becomes very difficult to grab that 15 pips.

Ideally this should be done with momentum. We want to buy as the price is moving in the direction of our target. This should sound familiar. In the only time that we trade new highs and new lows video, we discussed this.

We want to be trading with momentum. This is a scalping strategy so we have to manually control risk. So, something might be a little bit off there. So, just take your 10 pips profit in that case and get out, because we are expecting that price to just move through that level very quickly.

It should be a quick trade. If this is taking a long time to develop, something is wrong. So, quick trade, taking it with momentum as it approaches that level. Few quick examples here. In this case, at this point, this is the London session highlighted in yellow, and we have already moved. By the time we would have taken this trade, it had already moved about 80 pips, so definitely lots of good movement going on. So, here, a lot of momentum going into it.

We would have potentially got faked out on this one, that level, if we were looking to buy about 10 pips away. We would have bought right here.

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So, we would have potentially taken a few pip loss here. Remember, five is pretty much as max that we want to take. So, we would have lost about five pips, absolute max. If you were quick at cutting your loss, you probably only would have lost a couple.

So, we take another shot at it. So, we go long, about 10 pips below, right about there. So, long right about there. So, we went about 10 pips past it, so easily could have gotten out of our target there.

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Here, potentially lost five pips or a little bit less. So, net on the two trades, we would have been looking at at least 10 pips, probably a few more. Should show you on the hourly chart. I chose that level because it had not been touched in a long time. We can see the price was moving up towards it, and this was the level that we were looking at, or the example I showed you.

So, for the first time, when it popped above it, that was the bar that we were trading.

Once it had moved through it a few times, we no longer really want to trade that signal because the orders around that level have been move through and probably not going to have any real significance. That was on this day, which is the day that we looked at in the example a few minutes ago. So, only the first time. Another example here, June 2nd. Here is June 2nd. It did trade through it quite a bit here, but then we have this strong move down.

So, orders have likely collected around there again. This is a scalping strategy so we want to be able to implement it fairly often. This is fine here. It was traded through a few days ago, quite actively, but the price fell away from it.

It is now approaching it sort of fresh again, you could say so definitely we can look at trading this. This happens on June 2nd. So, here is June 2nd. The actual breakout occurs before the London session. So, yellow is the London session. So, this occurred overnight. See the price moves about 10 pips above.

So, once again, we could have easily got out of that trade, right about there, 10 pips below. We are looking at entering right about here. Similar situation to last time. This got to within about 7. So, if we had taken the long right here the first time, as soon as that price dropped away. So, 10 pips is right there. We do move onside, but then it quickly pulls away. So, since we are onside and then it pulls back from us, we could have likely got out of that first trade flat, avoided this little pullback, and then looked for this.

We see the momentum pick up again to the upside. We have a little bit of a breakout. We have a strong up-move, a little consolidation, and that 10 pips to the round number basically is a breakout of that consolidation, as you can see a little breakout here.

So, we would have been looking to go long right about there. Price immediately puts us onside. Momentum picks up, and we get that pop through the level as expected. So, very pretty easy trade there, again, for 15 pips. So, a couple examples there. Both of them would have netted at least 10 pips, even with a false type move right before it. We have to manually enter and exit these trades. We can put that target out five pips behind the round number.

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Some traders find this tough. You got to act without hesitation, not be afraid to take a second opportunity if it comes up. As we showed both of those, they failed the first time.

We only maybe lose a couple pips, and then we make it back on the next trade. So, that gives you kind of a top-end figure to work from for figuring out your stop loss or your position size. If you get to that five pips offside, get out. You should be trading with that momentum. These should go onside right away. You should be showing a profit pretty quickly. Momentum has to be there. You expect to get carried onside immediately after entry. So, if it gets to two pips beyond the round number and then starts to fall away or move back against you, just take the profit.

Take your five pips or your pip profit, your pip profit, whatever it is, and just get out. This is not really fine-tuning everything to hit a stop or target. Just take the profit, cut your losses, whatever. Trading involves substantial risk of loss. Only trade with capital you can afford to lose. So, go through these.

Test them out on a demo account. Just isolate the round numbers. Draw just a horizontal line on it, like I did. I typically use about 10 pips. You may find that seven or eight works better for you. So, until next time, happy trading. Contact Us Sitemap Affiliate Program Trading in financial instruments carries a high level of risk to your capital with the possibility of losing more than your initial investment.

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