"I want to start scalping with HFM, but can I really make money?" "Won't the fees and spreads be so high that I'll end up losing money?" Are you worried about these things as you take up FX as a side hustle?
In fact, if you correctly understand how to choose an HFM account and the trading methods, you can efficiently aim for profits through scalping even with limited time
This article provides a thorough explanation of scalping in HFM, from prohibited practices to practical winning strategies
■What you will learn from reading this article
- How to choose the right account type and instruments for scalping with HFM
- Specific methods and technical analysis for aiming for profits in a short time
- Rules for money management that strictly adhere to stop-loss and take-profit strategies
- Prohibited actions and safe trading methods to avoid violating the terms of service
- Mental control and practical tips for winning at scalping
By reading this article to the end, you will be able to safely and efficiently practice scalping with HFM and take the first step toward stabilizing your side income
For information on HFM's withdrawal refusals and reliability, please refer to HFM's reputation and customer reviews
Contents
- 1 HFM allows for scalping
- 2 Recommended account types for scalping with HFM
- 3 The advantages of scalping with HFM
- 4 Disadvantages of scalping with HFM
- 5 Prohibited practices in HFM scalping
- 6 Stocks suitable for scalping with HFM
- 6.1 USD/JPY | Narrow spread and high execution speed
- 6.2 Euro/Dollar (EUR/USD) | World's most traded currency pair, and technical analysis is highly effective
- 6.3 British Pound/Dollar (GBP/USD) | Large price fluctuations, suitable for short-term trading
- 6.4 Gold (XAU/USD) | Precious Metals CFDs that leverage high volatility
- 6.5 GBP/JPY | A high-volatility currency pair for advanced traders aiming for returns
- 7 Practical Techniques for HFM Scalping
- 8 Tips for winning with HFM scalping
- 9 Frequently Asked Questions about HFM Scalping
- 10 Summary | A thorough explanation of scalping with HFM
HFM allows for scalping
Scalping is permitted in HFM, and there are no special restrictions
It appears that neither HFM's official website nor its terms of service contain any mention of prohibiting scalping
While many overseas forex brokers restrict scalping due to server load concerns, HFM officially recognizes the scalping method, which involves making numerous trades in a short period of time
Furthermore, HFM also allows scalping using automated trading systems (EAs)
It can handle extremely short-term trades, such as scalping, which can last from a few seconds to a few minutes, without any problems
However, excessive trading that overloads the server, or repeatedly trading solely to capitalize on sharp price fluctuations during economic indicator announcements, may be considered a violation of the terms of service
Therefore, it is important to keep scalping within reasonable limits
Source: HFM
Recommended account types for scalping with HFM
When scalping with HFM, the choice of account type significantly impacts your profits
HFM offers multiple account types, each with different spreads and trading conditions
Choosing an account that takes into account factors such as transaction costs, capital requirements, and trading frequency is a crucial element for successful scalping
While all accounts offer leverage up to 2,000x, spreads and fee structures differ, so you need to determine which account best suits your trading style
| item | Zero Account | ProDrive | Standard Account |
|---|---|---|---|
| USD/JPY spread | 0.0 pips ~ | 0.7 pips ~ | 1.2 pips ~ |
| Transaction fees | $6 round trip per lot | none | none |
| Actual cost (USD/JPY) | Approximately 0.6 pips | Approximately 0.7 pips | Approximately 1.2 pips |
| Minimum deposit amount | none | none | none |
| Bonus eligible | × | × | ○ |
| Recommended Funds | Over 100,000 yen | Over 50,000 yen | Under 50,000 yen |
| Trading style | Scalping-focused | Scalping + Day Trading | Beginner/Small-amount trading |
Basically, the "Zero Account" is recommended
Source: HFM
The Zero Account is the ideal account type for those who want to seriously engage in scalping
Spreads on major currency pairs and gold start from 0 pips, significantly reducing costs for frequent scalping trades
However, it's important to note that a trading fee of $6 round trip is charged per lot, so you need to calculate the total trading cost
For example, in the case of USD/JPY, even if the spread is 0 pips, the actual cost including commissions will be around 0.6 pips
Nevertheless, the transaction costs are lower compared to other account types, which is a significant advantage for scalping traders who make dozens of trades a day
Furthermore, the Zero Account has a high execution rate, resulting in less slippage and enabling accurate entry and exit
For those with capital of 100,000 yen or more, or those who want to seriously generate profits through scalping, we highly recommend the Zero account
If you're considering scalping and day trading, choose the "Pro Account"
Source: HFM
The Pro account is suitable for those who want to use not only scalping but also day trading and swing trading
Instead of incurring transaction fees, this account features slightly wider spreads than a zero-fee account, offering flexibility to accommodate a variety of trading styles
If you don't trade scalping very frequently, or if you want to adjust your holding period depending on market conditions, a Pro account is the best choice
The USD/JPY spread on the Pro account averages around 0.7 pips, which is not significantly different from the effective cost of the Zero account (0.6 pips)
Especially if you trade 10 times or less per day, a Pro account, which has no transaction fees, can be more advantageous
Furthermore, the wide variety of CFD instruments available, covering everything from stock indices and precious metals to energy commodities, provides the flexibility to change your trading targets depending on market conditions
It's possible to strategically use scalping to aim for short-term profits while simultaneously using day trading to capture larger price movements during periods of clear trends
For part-time traders, this account type allows them to make the most of their limited time
For small amounts or if you prioritize bonuses, choose the "Premium Account"
Source: HFM
The premium account is recommended for those who want to start with a small amount of capital or who want to take advantage of bonuses
A key feature is that there are no transaction fees whatsoever; the only transaction cost is the spread, making cost calculations easy to understand
Furthermore, these accounts are often eligible for various bonus campaigns, allowing you to increase your margin and enhance the leverage effect
The USD/JPY spread in the premium account is around 1.2 pips on average, which is slightly wider than the zero account, but because there are no commissions, the effective cost can be lower for small trades
This is especially recommended for beginners who trade 0.1 lots or less per trade, or for those who want to get a feel for scalping
Furthermore, receiving deposit bonuses effectively increases your margin, allowing you to gain scalping experience while minimizing risk
This is recommended for those with less than 50,000 yen in funds, or those who want to start trading using a bonus
The advantages of scalping with HFM
HFM offers a very attractive trading environment for scalping traders
With high leverage, narrow spreads, and a zero-cut system that eliminates margin calls, it has all the necessary conditions for scalping, which aims to make profits in a short period of time
For company employees who are taking up FX as a side job, a major advantage is that it provides an environment where they can trade efficiently within their limited time
Furthermore, because the stop-loss level is set low, it becomes possible to withstand unrealized losses while waiting for the market to recover
| Benefits | HFM conditions | Impact on scalping |
|---|---|---|
| Maximum leverage | 2,000 times | Large positions with small margin |
| spread | 0.0 pips ~ | Significant reduction in transaction costs |
| Zero Cut | Recruitment | Zero margin call risk |
| Stop-loss level | 20% | Improved tolerance for unrealized losses |
You can trade with a maximum leverage of 2,000 times
HFM offers scalping trading with industry-leading leverage of up to 2,000 times
By utilizing high leverage, you can take on large positions with a small amount of margin, thus maximizing capital efficiency
For example, with a margin of 100,000 yen, it is theoretically possible to trade up to 200 million yen worth of assets
Scalping aims to capture small price movements, so a certain lot size is necessary, but high leverage can reduce the required margin
Normally, trading 1 lot (100,000 units) of USD/JPY requires approximately 10 million yen in capital, but with 2,000x leverage, a margin of just 5,000 yen is sufficient
However, since higher leverage increases risk, proper money management and lot size adjustments are crucial
Especially for part-time traders, we recommend using leverage within reasonable limits to aim for stable profits
Narrow spread
HFM offers industry-leading narrow spreads, significantly reducing the trading costs for scalping
With a Zero Account, major currency pairs such as USD/JPY and EUR/USD can be traded from 0.0 pips, which is a significant advantage for scalping, a strategy that involves frequent buying and selling
The narrow spread makes it easier to secure profits even with small price movements
For example, if you compare a broker with a USD/JPY spread of 1.0 pips with an HFM with a spread of 0.2 pips, a difference of 8 pips (approximately 800 yen/lot) will result if you make 10 trades a day
If you make 200 trades a month, the cost difference can amount to 160 pips (approximately 16,000 yen per lot)
In scalping, the impact of the spread becomes greater the more trades are made, so HFM's narrow spreads are very advantageous in the long run
Except for early mornings and during economic indicator announcements, the spread remains stable, which is one of its attractions as it helps avoid unexpected cost increases
Since it employs a zero-cut system, there are no margin calls
With HFM's zero-cut system, you will not be required to pay additional margin even if losses exceed your account balance
This completely eliminates the risk of losing more than your initial investment, even if unexpected and rapid market fluctuations occur during scalping trading
Since domestic FX brokers may require margin calls, this is a significant advantage of HFM
For example, let's say you use a margin of 100,000 yen to engage in high-leverage trading, and a sudden market fluctuation results in a loss of 500,000 yen
With a domestic broker, you would be required to pay a margin call of 400,000 yen, but with HFM, your account balance will simply be reduced to zero
Because scalping involves holding many positions in a short period of time, there is always a risk of system failures or sudden fluctuations during the release of important economic indicators
The zero-cut system allows you to confidently try high-leverage scalping, and even part-time traders can continue trading while reducing their mental burden
A stop-loss level of 20% makes it easier to withstand unrealized losses
HFM's stop-loss level is set at 20%, which is lower compared to other overseas forex brokers
This makes it less likely for positions to be forcibly liquidated even if temporary unrealized losses occur, giving you more time to wait for the market to recover
Scalping requires quick decision-making, but a benefit of having a low stop-loss level is that you don't have to panic and cut your losses
For example, even if the margin maintenance ratio falls to 30%, you can continue trading, and if the market reverses, you may be able to avoid losses
Many brokers have stop-loss levels of 50% or 100%, so HFM's 20% level is very advantageous
However, even if the stop-loss level is low, reckless trading is strictly prohibited, and it is important to set appropriate stop-loss rules
While scalping fundamentally involves cutting small losses early, having some leeway to withstand temporary adverse movements allows for calmer decision-making
Disadvantages of scalping with HFM
While HFM provides an environment suitable for scalping, it also has some drawbacks
The main challenges include the introduction of trading fees, restrictions on stop levels, and the elimination of bonuses
Understanding these disadvantages in advance allows you to adjust your trading strategy appropriately and avoid unexpected losses
Those who engage in scalping as a side hustle, in particular, need to consider the disadvantages before deciding on an account and trading method in order to efficiently utilize their limited time and capital
| Disadvantages | Impact | countermeasure |
|---|---|---|
| Transaction fees | high | Calculation is required when using a zero account |
| Stop level | Medium | The stop-loss range needs to be adjusted |
| Abolition of bonuses | Medium | Considering using other companies in conjunction |
| Leverage restrictions | low | This can be avoided through proper balance management |
| Spread widening | Medium | This can be mitigated by selecting the right brand |
Transaction fees are incurred as a cost
earlier in the section titled "[ Basically Recommended is the 'Zero Account'] ", HFM's Zero Account offers narrow spreads in exchange for transaction fees.
Since there is a $6 round-trip commission per lot, the total cost tends to increase with scalping, which involves a large number of trades
Even with a narrow spread, it's crucial to accurately calculate the actual cost, including fees
For example, if you make 20 trades in a day, the fees alone will cost you $120 (approximately 18,000 yen). *Assuming 1 lot = 100,000 units of currency.
If you make 400 trades a month, you'll incur fees of $2,400 (approximately 360,000 yen)
For a 0.1 lot trade of USD/JPY, the commission is $0.60, but if you trade 20 times a day, that's $12, and if you trade 400 times a month, that's $240
For beginners with low trading volume or those who only trade a few times a day, the impact of fees is limited. However, if you are seriously engaging in scalping, it is essential to calculate your profits while taking fees into account
Standard accounts have no commission fees, but the spreads are wider, so which is more advantageous depends on your trading style
There is a limit to the stop level
In HFM, a stop level is set for each stock, and limit and stop-loss orders cannot be placed within a certain distance from the current price
Stop-level restrictions can make it difficult to set precise stop-loss and take-profit levels, which are crucial for scalping
This restriction particularly limits trading freedom in currency pairs with small price volatility
For example, if the stop level for USD/JPY is set at 3.0 pips, you cannot place stop-loss or take-profit orders within 3.0 pips of the current price
Since scalping often aims for profit margins of around 2-5 pips, it becomes difficult to trade efficiently with stocks that have high stop-loss levels
Furthermore, it's important to consider the risk of incurring greater losses than anticipated during sudden market fluctuations, as you may not be able to place stop-loss orders at your intended positions
To avoid this problem, you need to either choose stocks with low stop levels or utilize manual settlement with market orders
Account opening bonus is unavailable
Source: HFM
HFM has discontinued the account opening bonus that was previously offered, and it is no longer possible to trade without an initial deposit
Other overseas forex brokers often offer account opening bonuses ranging from 3,000 yen to 15,000 yen, which puts HFM at a disadvantage
For beginners, especially those with limited funds, starting without a bonus can be a significant burden
With an account opening bonus, you can practice scalping and test trading methods without using your own funds
However, with HFM, you need to invest your own capital from the start, so you have to begin with practical experience that involves risk
While deposit bonuses are still offered, the conditions are strict and there are restrictions on withdrawals, so the actual benefits are limited
To solve this problem, an effective approach is to gain experience in scalping by utilizing account opening bonuses from other brokers before transitioning to full-scale trading with HFM
The maximum leverage is reduced depending on the effective margin
With HFM, as your account balance increases, your maximum leverage is gradually restricted
As your effective margin increases, your leverage decreases, which may reduce trading efficiency when your capital grows
The disadvantage of this restriction is that it creates limitations on how to use funds after significant profits have been made
Specifically, if your investment exceeds $50,000 (approximately 7.5 million yen), the maximum leverage is capped at 1,000 times, and if it exceeds $200,000 (approximately 30 million yen), it is capped at 500 times
If you succeed in scalping and your capital increases, the margin required for trading the same number of lots will also increase, worsening capital efficiency
For example, if you were trading 1 lot with 2,000x leverage, limiting it to 1,000x would effectively double your required margin
This problem can be solved by opening multiple accounts to diversify your funds, or by regularly withdrawing a portion of your profits
Gold and cryptocurrency CFDs tend to have wide spreads
HFM tends to have wider spreads on instruments other than currency pairs, especially gold and cryptocurrency CFDs
This phenomenon occurs when the spread widens significantly during periods of high market volatility or low liquidity
This may result in transaction costs significantly exceeding those anticipated
For example, even if the normal spread for gold is 0.3 pips, it can widen to 2.0 pips or more during important economic indicator announcements or at the start of trading
There is a high possibility that spreads will widen further in cryptocurrency CFDs
In scalping, where the goal is to make small profits, a widening spread can have a fatal impact
To avoid this problem, you should either limit your trading to times when spreads are stable or switch to a currency pair-centric trading strategy
It is important to understand the spread fluctuation patterns in advance and avoid times when spreads are likely to widen
Prohibited practices in HFM scalping
While scalping itself is permitted at HFM, certain trading methods are explicitly prohibited by the terms of service
Engaging in transactions that fall under these prohibited activities may result in severe penalties, such as the cancellation of profits or the freezing of your account
In particular, trading that exploits system vulnerabilities and arbitrage that takes advantage of unfair price differences are strictly prohibited, so caution is advised
When engaging in scalping as a side hustle, it is crucial to fully understand these prohibited practices and strive for sound trading practices
Latency and inter-broker arbitrage are prohibited by the terms of service
HFM explicitly prohibits trading methods such as latency arbitrage and inter-broker arbitrage
These methods exploit delays in price delivery or price differences between brokers and are considered fraudulent transactions that differ from typical scalping
When using high-speed trading systems or Expert Advisors (EAs), it is especially important to be careful not to unintentionally fall into these practices
Latency arbitrage is a technique that profits from delays in price delivery
For example, this includes actions such as taking advantage of the delayed response of servers after the release of important economic indicators and trading by referencing the prices of other companies
Inter-broker arbitrage is a trading strategy that takes advantage of price differences between multiple FX brokers, aiming to profit risk-free by simultaneously holding a buy position with one broker and a sell position with another
While these transactions are technically possible, they will be severely punished as a violation of the terms of service at HFM
As long as you are trading using technical and fundamental analysis in a normal scalping strategy, you will not be subject to these prohibitions
Intentional exploitation of server errors or price bugs is prohibited
HFM also prohibits trading that intentionally exploits server errors or price display bugs
If abnormal prices are displayed due to a system malfunction, using them to conduct transactions will be considered fraudulent activity and will be subject to severe penalties
If you encounter such a situation, the appropriate course of action is to refrain from trading and report it to support
As an example of a price bug, the USD/JPY pair, which normally trades at 150 yen, may be displayed as 100 yen due to a system error
Transactions at such obviously abnormal prices are highly likely to be canceled later, even if they appear completed on the trading screen
Furthermore, it is prohibited to take advantage of delays in order execution caused by server errors to execute trades at a favorable price after the price has moved
Particular caution is needed during times when the system is prone to instability, such as when important economic indicators are released or immediately after server maintenance
If you discover such a problem, it is important to contact customer support immediately without proceeding with the transaction and ask for their instructions
In order to continue healthy scalping trading, it is essential to cooperate in maintaining a fair trading environment
Stocks suitable for scalping with HFM
When scalping with HFM, stock selection is key to success
By selecting stocks with narrow spreads, high execution speed, and moderate volatility, it becomes possible to secure profits efficiently
In particular, it is important to select the most suitable instrument from among currency pairs and precious metal CFDs, depending on the trading time and market conditions
For those who engage in scalping as a side hustle, it is recommended to understand the available trading hours and the characteristics of each stock, and to focus on trading stocks that suit your lifestyle
| Brand | Average spread | Volatility | Recommended time | Difficulty |
|---|---|---|---|---|
| USD/JPY | 0.2 pips | low to medium | 9:00 AM to 12:00 AM Japan Standard Time | Beginner |
| Euro/Dollar | 0.1 pips | Medium | 16:00-2:00 JST | Beginner |
| Pound-dollar | 0.3 pips | high | 16:00-2:00 JST | Intermediate |
| gold | 0.3 pips | high | 21:00-2:00 JST | Intermediate |
| GBP/JPY | 0.5 pips | Extremely high | 16:00-24:00 Japan time | advanced |
USD/JPY | Narrow spread and high execution speed
The USD/JPY pair is the most recommended currency pair for beginners in scalping
This might be the most familiar currency pair for Japanese people
With HFM, you can trade with narrow spreads averaging around 0.2 pips, and the execution speed is extremely high, allowing you to focus on scalping in a stable trading environment
Furthermore, price movements are relatively calm and predictable, which helps mitigate the risk of sudden price fluctuations
A major advantage of the USD/JPY pair is that it is actively traded from 9 AM to midnight Japan time
Liquidity is particularly high and spreads are stable between 9:00 AM and 3:00 PM in the Tokyo market, and between 10:00 PM and 2:00 AM the following day in the New York market
The price movement range is around 50-100 pips per day, forming small waves suitable for scalping
Technical analysis is also effective, and moving averages and support/resistance lines tend to function well
For part-time traders, the fact that there are plenty of trading opportunities even at night after returning home is also appealing
Although susceptible to economic indicators, this currency pair tends to move within a predictable range, making it relatively easy to manage risk
Euro/Dollar (EUR/USD) | World's most traded currency pair, and technical analysis is highly effective
The Euro/Dollar is the world's most traded currency pair, offering ideal conditions for scalping
Due to the high trading volume, liquidity is extremely high, and you can trade with extremely narrow spreads of around 0.1 pips on HFM
Similar to the USD/JPY pair, it is characterized by a high degree of accuracy in technical analysis, and chart patterns and indicators tend to work straightforwardly
The best time to trade EUR/USD is from 9 PM to 2 AM Japan time, when the London and New York markets overlap
This time of day is the most active trading period, and you can expect price movements of 20-30 pips per hour
Since scalping often aims for profit margins of around 5-10 pips, there are plenty of trading opportunities
Furthermore, the market tends to move significantly when economic indicators are released in the United States and Europe, making it suitable for indicator-based trading
In technical analysis, oscillator indicators such as Bollinger Bands and RSI often work well
However, it's important to note that trading hours change between daylight saving time and standard time, and liquidity decreases on European holidays
British Pound/Dollar (GBP/USD) | Large price fluctuations, suitable for short-term trading
The GBP/USD pair is a currency pair suitable for scalping, as it exhibits large price fluctuations and allows traders to aim for significant profits in a short period
Because price movements of 30-50 pips occur frequently within an hour, you can efficiently accumulate profits even with a small number of trades
A characteristic of the GBP/USD pair is that when a trend develops, it tends to move significantly in one direction
Trading activity is particularly high from around 4 PM Japan time, when the London market opens, and is easiest to access between 9 PM and 2 AM the following day, which is the overlapping trading period with the New York market
With scalping, it's possible to aim for profits of around 10-20 pips, which is about twice as efficient as trading USD/JPY
However, because stop-loss orders may not be effective due to rapid price movements, it is important to keep position sizes small
Furthermore, because it is heavily influenced by the political situation and monetary policy in the UK, it is necessary to always pay attention to related news
Because of its volatile price movements, this currency pair carries high risk and requires proper money management, making it recommended for intermediate and advanced traders
Gold (XAU/USD) | Precious Metals CFDs that leverage high volatility
Gold is particularly popular among precious metal CFDs and is a stock that can yield significant profits through scalping
High volatility causes significant price fluctuations in a short period, allowing you to efficiently secure profits even with limited trading time
The price of gold is strongly influenced by U.S. monetary policy, geopolitical risks, and the dollar exchange rate
The market often moves significantly, especially during New York trading hours, from 9 PM to 2 AM Japan time, with frequent price fluctuations of $10-30 per hour
Scalping typically aims for profit margins of around $5-10, and is characterized by the potential for larger profits compared to other currency pairs
HFM offers a narrow spread of around 0.3 pips for gold, but it's important to note that the spread tends to widen when the market is volatile
Furthermore, since more margin is required than the currency pair itself, careful fund management is essential
As a stock with high risk and return, I recommend it to intermediate and advanced scalpers
GBP/JPY | A high-volatility currency pair for advanced traders aiming for returns
The GBP/JPY pair is one of the most volatile major currency pairs and is a suitable instrument for advanced scalpers
It's not uncommon for price movements to reach 100-200 pips in a single day, offering the potential for large profits in a short time, but also carrying an extremely high risk of losses
The GBP/JPY pair is known as a "killer currency" due to its volatile price movements, with fluctuations of 50-100 pips in an hour being frequent
The most active trading period is particularly from 4 PM Japan time, when the London market opens, until midnight, when the Tokyo market closes
Scalping allows you to aim for large profit margins of around 20-30 pips, and if successful, you can earn several times the profit from other currency pairs
However, there is a risk that stop-loss orders may not function due to rapid price movements, or that slippage may become significant
Furthermore, fundamental analysis is also important because many factors influence prices, including the interest rate differential between the pound and the yen, economic indicators from both countries, and risk-on/risk-off market sentiment
This is a high-risk, high-return currency pair that is only recommended for advanced traders with extensive experience and strong mental fortitude
Practical Techniques for HFM Scalping
To succeed in scalping with HFM, a combination of specific methods and technical analysis is crucial
To secure profits in a short time, it's essential to accurately determine the timing of entry and exit
For those who are taking up FX as a side hustle, I will introduce three methods that utilize Bollinger Bands, RCI, and price action, making them easy to implement
These techniques are very simple, effective on 1-minute to 5-minute charts, and allow for efficient trading even with limited time
| method | Difficulty | Profit target | Applicable market price |
|---|---|---|---|
| Bollinger Bands × RSI | Beginner | 5-10 pips | Range market |
| RCI inversion | Intermediate | 8-15 pips | All market prices |
| Price Action | advanced | 10-30 pips | All market prices |
A trading strategy using 1-minute charts, Bollinger Bands, and RSI
A scalping strategy that combines Bollinger Bands and RSI on a 1-minute chart is easy for beginners to understand and is practical
By simultaneously confirming touches to the ±2σ levels of the Bollinger Bands and overbought/oversold conditions on the RSI, highly accurate counter-trend entries become possible
With this method, you can choose to take profits at 5-10 pips if you prioritize certainty, or up to the opposite band if you aim for a larger profit margin
As shown in the chart analysis, the specific entry condition is a sell entry when the price reaches the +2σ of the Bollinger Bands and at the same time the RSI is above 70
Conversely, if the RSI touches -2σ and falls below 30, I would consider a buy entry
When taking profits, after confirming a rebound from the Bollinger Bands, you can choose to either aim for a breakout to the opposite band (±2σ) or secure a fixed profit of 5-10 pips
Stop-loss orders are placed when the price clearly breaks above or below the band
This method is characterized by average trade durations of 3-8 minutes and is particularly effective in range-bound markets rather than trending markets. Avoid trading around the time of economic indicator announcements and aim to trade during calm market hours
RCI Reversal Timing Type Scalping Strategy
Scalping techniques that utilize RCI (Rank Correlation Index) are excellent methods for accurately identifying market turning points
Compared to other oscillator indicators, the RCI reacts sensitively to small price movements, making it very suitable for scalping, which aims to capture short-term price fluctuations
This method is characterized by its ability to more accurately determine entry timing by combining short-term RCI (9 periods) in red , medium-term RCI (26 periods) in blue , and long-term RCI (52 periods) in green
There are two specific methods
The first strategy is "buying on dips and selling on rallies in long-term trends." This involves confirming the long-term trend on the 1-hour chart and entering a trade when the short-term RCI crosses the ±80% level on the 5-minute chart
The second method is a "slightly aggressive trend-following trade," which involves entering a trade on the 5-minute chart when all three RCI lines (long-term, medium-term, and short-term) simultaneously cross the ±80% level
The trend confirmation on the higher timeframe is the same as the first method
Profit-taking is done when the short-term RCI reaches ±80% in the opposite direction or touches an important horizontal line, and stop-loss is set at the most recent high or low
In scalping, the focus is on the win rate, and it's important to steadily accumulate profits, aiming for a profit of 8-15 pips per trade。
However, since there are many false signals on short timeframes, combining multiple RCIs to strengthen your evidence and practicing proper money management are key to success
Using price action
Scalping, which utilizes price action, is an advanced technique that reads market psychology from chart patterns
We analyze the psychology of market participants based on the shape and combination of candlestick patterns, identify price turning points and continuation patterns, and then enter a trade
Pin bars and thrust patterns, in particular, are representative price action patterns that are highly effective in short-term trading
Make sure you remember this
Pin bar
A pin bar is a candlestick with long upper and lower wicks, and it is a powerful signal indicating a market reversal
The ideal shape is one that has whiskers that are more than three times longer than the body, and where the short whiskers and body make up less than one-third of the total size
Long wicks indicate strong pressure in one direction followed by a rebound, presenting an excellent opportunity for scalping to target a 5-10 pip reversal
Thrust (thrust up, thrust down)
A thrust is a strong continuation pattern formed by consecutive candlesticks of the same color
Three or more consecutive bullish candlesticks (thrust up) or bearish candlesticks (thrust down) indicate an accelerating trend, making it an excellent time to enter a trade in the direction of the trend
This pattern is particularly likely to appear during important support and resistance breakouts, offering the potential for significant profits
Tips for winning with HFM scalping
To succeed in scalping with HFM, not only technical skills but also mental fortitude and money management are crucial
In scalping, which involves making many trades in a short period of time, a single misjudgment can lead to significant losses
For those who engage in FX trading as a side hustle, in particular, clear rules and mental control are essential to efficiently utilize limited time and capital
Here are four important tips to keep in mind when scalping with HFM
By keeping these points in mind, you can aim for stable profits
Strictly adhere to stop-loss and profit-taking rules
The most important thing in scalping is to set clear stop-loss and take-profit rules and to always stick to them
By mechanically executing rules without being swayed by emotions, you can minimize losses and steadily accumulate profits
The basic strategy is to decide on specific stop-loss levels (2-3 pips) and take-profit levels (5-15 pips) in advance and place orders simultaneously when entering a trade
For example, when scalping with USD/JPY, you would set a 5-pip profit target and a 3-pip stop-loss at the same time as entering a trade
In this case, if the win rate exceeds 60%, the balance will be positive
The important thing is to wait until you reach your profit target even if you have unrealized gains, and to always close your position at your stop-loss line even if your unrealized losses are growing
It's crucial to avoid the expectation that the price might recover if you wait a little longer; consistently making payments according to the rules is the key to long-term success
Furthermore, it's necessary to set a daily loss limit and exercise self-control by stopping trading once that limit is reached
In scalping, small profits and losses accumulate, so strictly adhering to the rules is paramount
Be mindful of the balance between lot size and money management
Setting the appropriate lot size is fundamental to achieving stable profits through scalping
Trading with excessively large lot sizes relative to your margin increases the risk of losing a significant amount of capital in a short period, even with a slight adverse movement
Generally, a good guideline is to limit the risk of each trade to within 1-2% of your account balance
Specifically, with a margin of 100,000 yen, the loss per trade should be limited to within 1,000-2,000 yen
If you have set your stop-loss at 3 pips, then approximately 0.3 lots would be an appropriate lot size for USD/JPY
Furthermore, it's important to reduce the lot size when you're on a losing streak, and to avoid increasing it too drastically when you're on a winning streak
While HFM's maximum leverage of 2,000x is attractive, it's best to avoid trading with full leverage and to practice sound money management
By creating a fund management sheet and recording your daily trading results, you can objectively assess your trading performance
For part-time traders, the key to long-term success is to avoid investing excessive funds and to trade only within a range that does not disrupt your daily life
Mental control to avoid taking on unreasonable positions
Maintaining calm judgment is extremely important in scalping, and emotional trading is the biggest cause of failure
Especially after a losing streak or missing out on a big profit, it's easy to become emotional and make reckless trades, but the key to success is mental control to avoid this
It's important to set clear entry conditions before trading and have the courage to pass on trades when those conditions are not met
Increasing the lot size or ignoring stop-loss lines out of a desire to "get your money back" is a typical pattern of failure
Furthermore, even when you're making a profit, it's important not to get greedy and think "I should be able to make more," but to close your position reliably at the profit target you've set
Limit the number of trades per day to prevent fatigue-induced decline in judgment
When scalping as a side hustle, stress from your main job can affect your trading, so it's necessary to decide to refrain from trading on days when you're not feeling well
By keeping a trading journal regularly and analyzing the relationship between your emotional state and trading results, you can identify areas for improvement in your mental approach
Avoid trading during economic indicator announcements
The market tends to fluctuate sharply when economic indicators are released, making it an unsuitable time for scalping
This is because spreads widen significantly before and after the release of important economic indicators, and the risk of losses increases significantly due to unexpected price fluctuations
In particular, you should avoid trading during times when important indicators such as employment statistics, GDP, and central bank policy interest rate announcements are released
During economic indicator announcements, the USD/JPY spread, which is normally 0.2 pips, can widen to 2-5 pips, which alone can wipe out scalping profits
Furthermore, because prices move significantly in one direction, conventional technical analysis becomes less effective
It's essential to check HFM's economic calendar and external indicator calendars in advance, and to refrain from trading 30 minutes before and after important indicators are released
By avoiding trading during economic indicator announcements, you can trade in a stable spread environment, significantly improving the success rate of scalping
For part-time traders, trading hours are limited, so it's crucial to check the economic indicator schedule in advance and plan efficient trading times
Frequently Asked Questions about HFM Scalping
When starting scalping with HFM, many traders have questions and concerns
There are many important points that need to be resolved before actually starting trading, such as trading restrictions, technical requirements, and risk management
By resolving these questions in advance, you can focus on scalping trading with peace of mind and avoid unexpected problems
Here, we provide specific and practical answers to six of the most frequently asked questions regarding scalping with HFM
This guide focuses on common problems faced by those pursuing FX trading as a side hustle, and compiles practical information useful for actual trading
Summary | A thorough explanation of scalping with HFM
HFM offers a trading environment suitable for scalping, with leverage up to 2,000x and narrow spreads
With a Zero Account, you can trade major currency pairs from 0 pips, and the zero-cut system eliminates the risk of margin calls
However, there are also disadvantages that should be understood in advance, such as transaction fees and stop-loss level restrictions
To succeed in scalping, it's crucial to master specific techniques that utilize Bollinger Bands and RCI
Even more important are the strict adherence to clear stop-loss and take-profit rules, and proper money management. Calm, uninfluenced decision-making and avoiding trading during economic indicator announcements are also essential
For those considering scalping as a side hustle, I recommend starting with ample practice using a demo account
By understanding HFM's prohibited activities and striving for sound trading practices, you can avoid the risk of account suspension
If you want to make the most of your limited time and aim for a stable side income, scalping with HFM (High-Fifth Marketing) could be a viable option
Through correct knowledge and continuous learning, you can steadily improve your skills
