{"id":45321,"date":"2015-11-08T00:38:41","date_gmt":"2015-11-08T08:38:41","guid":{"rendered":"https:\/\/brookstradingcourse.com\/?p=45321"},"modified":"2021-09-22T01:30:00","modified_gmt":"2021-09-22T08:30:00","slug":"scalps-versus-swings-for-beginner-traders","status":"publish","type":"post","link":"https:\/\/www.brookstradingcourse.com\/pt-br\/ask-al\/scalps-versus-swings-for-beginner-traders\/","title":{"rendered":"Ask Al: Scalps versus swings for beginner traders"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">BPA trading room Q&amp;A: September 18, 2015<\/h2>\n\n\n\n<p class=\"content-box-green\">Al was asked why he takes so many scalps, and few swings. Yet for beginner traders he absolutely recommends looking for swing trades. Here&#8217;s why.<\/p>\n\n\n\n<p><em>Video duration: 9min 3sec<\/em><\/p>\n\n\n\n<div style='position:relative;height:0;padding-bottom:56.25%'><iframe class='sproutvideo-player' src='https:\/\/videos.sproutvideo.com\/embed\/709adfbb1319eecaf8\/2a8b084e8d7e59e6?playerTheme=dark&amp;playerColor=' style='position:absolute;width:100%;height:100%;left:0;top:0' frameborder='0' allowfullscreen><\/iframe><\/div>\n\n\n\n&nbsp;\n\n\n\n<p class=\"caption\">You can view this video on <a href=\"https:\/\/youtu.be\/f93MK9bJFo8\" target=\"_blank\" rel=\"noopener\">Al&#8217;s YouTube Channel<\/a> if needed.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Video transcript<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Beginner traders should look for swings<\/h3>\n\n\n\n<p>Q: Okay, today you say you have a high winning percentage, you have to take many scalp trades and only one-to-two swing trades. But in some of your videos you say it\u2019s better to take swing trades than scalps.<\/p>\n\n\n\n<div class=\"wp-block-image size-full wp-image-45328\"><figure class=\"alignleft\"><img decoding=\"async\" src=\"https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2015\/11\/funny-little-man-holding-bag-of-money-lhs.jpg\" alt=\"Funny Little Man Holding- Bag of Money\" class=\"wp-image-45328\" title=\"\"><figcaption>That little man again.<\/figcaption><\/figure><\/div>\n\n\n\n<p>It\u2019s absolutely better to take swing trades than scalps when you\u2019re starting out, okay? Most traders who\u2019ve been doing this a long time prefer swing trades. I prefer swing trades, but really good swing trades don\u2019t come as often as scalps. I see scalps on every bar. To me, it\u2019s like a little man holding on a bag with gold coins in it. Do I tell him, \u201cNah, go away\u201d or do I say, \u201cOkay, I\u2019ll take it.\u201d For me, I take it.<\/p>\n\n\n\n<p>So I do like the swing trade, but most of the time most of the bars do not have really good swing trade set-ups, so I scalp. But for a trader starting out, they are going to lose money if they focus on scalps. Because of the risk-reward situation, and to do it well, in general, you usually have to scale in, and it\u2019s really hard to make the decisions fast enough. And you make it much more complicated by scaling in and scaling out &#8212; you take out, go out in pieces, and it\u2019s really hard to get everything right. And if you don\u2019t do it right, it\u2019s a sure way to lose money really fast.<\/p>\n\n\n\n<p>So that means, I think, I believe that most people starting out &#8212; if they\u2019re not consistently profitable &#8212; should not be doing that. They should just be swing trading, maybe take an occasional \u201cBuy The Close, Sell The Close\u201d bar, which is actually a pretty good way to trade, but they should be sticking to swing trades. However, what you\u2019ll discover is once you become profitable &#8212; I\u2019ve heard from many traders over the years say this &#8212; \u201cAl, what do I do? I\u2019ve been swing trading, but I\u2019m finding\u2026 let\u2019s say I buy and I know the market\u2019s going to pull back for a few bars because I\u2019ve been trading long enough now to know it\u2019s going to pull back for a few bars, do I get out and buy again three points lower? Or do I hold? Or in fact, I see a minor sell setup, a minor reversal sell. Do I take the sell and then buy again later?\u201d<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Experience can lead naturally to more scalping<\/h3>\n\n\n\n<p>So what happens is as traders get experience, they start to realize that they can manage their swing trades differently, and start <a href=\"\/how-to-trade-manual\/extreme-scalping-manual-high-frequency-trading-hft\/\" target=\"_blank\" rel=\"noopener\">incorporating scalps<\/a>. And as time goes one what they decide is, \u201cI want to trade all day long.\u201d There are not swing trades all day long. A lot of times during the day, you get two hours of this, and yes, you could say, \u201cWell, we\u2019re still in a swing short from here, stop above here,\u201d or you can say, \u201cI\u2019m just going to sell above that, buy below that, sell above this, sell more, buy below this, buy below that, buy below that.\u201d You just keep scalping, and scaling in, and trading all through that mess instead of just saying, \u201cHey, I shorted 34 close. I put a stop up here, and I get out over here &#8212; you know what I mean, three or four points.\u201d Both are acceptable ways to trade, but, I see something to do on just about every bar. So my choice is to just stay with the swing trade or to keep doing things all day long, and to be honest, I probably would make as much if I just took a few swing trades and just held. But I like to feel more active, and personally I prefer a much higher winning percentage&#8211;and I do not like big drawdowns.<\/p>\n\n\n\n<p>So, for me, I always try to take one trade four points &#8212; [with] the market big like this, 5 points, 10 points &#8212; I always try to take at least one of those a day. But I could call it quits at that point and say, \u201cOkay, I made a good profit and I can just sit back the rest of the day\u201d or I can say, \u201cOh, I can buy this and buy more lower. I can sell that and sell more higher,\u201d and just accumulate all the little pieces, all those little bags of gold all day long, which is what I do. But when a person\u2019s starting out, they will lose money for sure, and fast, if they start scalping and scaling in. It\u2019s a sure way to lose money. Instead, they should just look for situations where a breakout has a reasonable chance of happening and enter on the Major Trend Reversal or the higher low, or whatever, buying above 7, or buying the 8 or 9 close, and then trying to get 4 points or 10 points out of it. Or selling the 34 close, or even the 35 close stop up here and trying to get 4 points, 5 points, 10 points out of it, and not worry about all the little swing trades. But once you start to get good and a lot of experience and consistently making money, you\u2019ll probably start to get out of swings quicker and break the swing into pieces. So, instead of buying the 4 high and exiting below 29, you might buy the 4 high, get out over here at the moving average, and then scale in with a long stop below here, buy more here, sell up here. You\u2019ll start to look for other things to do, and you\u2019ll end up dividing a swing trade into a lot of little pieces, and little pieces add up to about the same as a swing trade &#8212; they can add up to more &#8212; and the probability is higher.<\/p>\n\n\n\n<p>There are a lot of traders out there who <a href=\"https:\/\/dailyfx.com\/forex\/education\/trading_tips\/trend_of_the_day\/2013\/06\/18\/What_is_a_Good_Win_Ratio.html\" target=\"_blank\" rel=\"noopener\">win 90 percent of their trades<\/a>. When they tell you that, they\u2019re telling you that most of their trades are for 1, 2, or 3 points. However, if you\u2019re winning 90 percent of your trades and consistently making 1, 2, or 3 points on those trades and then an occasional trade with 5 or 10 points, I think you\u2019re doing really, really well. But there are other traders who simply look for one or two swing trades a day and take those And they say, \u201cThat\u2019s fine. I\u2019m comfortable, I\u2019m happy, and I\u2019m getting rich. That\u2019s all I need.\u201d I don\u2019t have a problem doing it either way, but I think when you\u2019re starting out you should be looking for one or two swing trades a day.<\/p>\n\n\n\n<p>My minimum definition of a swing trade in the Emini is 4 points, so traders starting out &#8212; they should just, every day, look for at least one 4-point trade. So you buy above 7, put a stop below 7, put a limit order to make a 4-point profit, and then come back in an hour. Or you sell the 33 or 34 close, put a stop above 32 or 31 or 37, put a limit order to buy back 4 points later, and go to the grocery store. I\u2019m not being a wise guy when I say that. I had a friend &#8212; I traded with him online every day for years &#8212; that\u2019s exactly what he did. He would wait for a swing trade in the first hour or two, put it on, and then say, \u201cAl, I\u2019m going to the doctor\u2019s office,\u201d or \u201cI\u2019m going to grocery store\u201d or \u201cI\u2019m going in the lake with a canoe and I\u2019ll come back in a couple of hours,\u201d and then he\u2019d come back and he\u2019d say, \u201cOh Al, it looks like I made 4 points\u201d or \u201cI made 10 points\u201d or whatever. That sounds crazy and it sounds unreal, but it\u2019s very real. It is an okay thing to do.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Starting out? Focus on a swing or two each day<\/h3>\n\n\n\n<p>So, if you\u2019re starting out, that should be your focus, looking for a swing trade sometime in the first hour or two that\u2019s good for 4 points or more And just &#8212; every day &#8212; practice trying to take that trade. That should be your focus every day, trying to get that swing in the first hour, and not be too impatient. So if you\u2019re selling, it\u2019s probably not going to be a good short below 4, below 3, a bull bar, or below 9 or below 11. Yet, the bulls had good bull signal bars, 1, 5, and 7. So if we\u2019re going to have a 4-point swing up or down in the first hour, what do you think it\u2019s going to be, up or down? It\u2019s probably going to be up.<\/p>\n\n\n\n<p>You can say, \u201cWell, Al, 6 is a bear bar closing on its low\u201d and it is \u2013 I think we\u2019re still Always In Long &#8212; and then we reversed it on bar 7. So to me, I\u2019m looking for a stop entry, buy above a good-looking bull bar or a decent-looking bull bar. I\u2019m also willing to sell if I get a decent-looking bear bar. But on a swing; I\u2019m looking for a good-looking signal bar in a good-looking context, and place the orders. And if you cannot sit there and stop yourself from exiting with a 1-point profit or with a 6-tick loss when the market goes against you, go out and take that walk and come back.<\/p>\n\n\n\n<p>But you look at the chart &#8212; just scroll back at the chart. Every day, you\u2019ll see that 90 percent of the days have a reasonable swing trade in the first hour or two, and it\u2019s fairly easy to spot. But it\u2019s also fairly easy to deny. Very often, when they set up, it\u2019s easy to say, \u201cWell, it does not look quite good enough and maybe I\u2019ll wait for another one.\u201d And it\u2019s okay to wait for the breakout, but it\u2019s also okay to take the setup that looks reasonably good in the context that\u2019s reasonably good. You have a reasonably good shot at making your 4 points and it is usually better just to go ahead and take the trade.<\/p>\n\n\n\n<p><em>Al Brooks<\/em><\/p>\n\n\n\n<p><a title=\"Al Brooks&#039; trading room\" href=\"https:\/\/www.brookstradingcourse.com\/online-day-trading-room\/\">Information on Al&#8217;s Online day trading room<\/a><\/p>\n\n\n\n<hr class=\"wp-block-separator\"\/>\n","protected":false},"excerpt":{"rendered":"<p>BPA trading room Q&amp;A: September 18, 2015 Al was asked why he takes so many scalps, and few swings. Yet for beginner traders he absolutely recommends looking for swing trades. Here&#8217;s why. Video duration: 9min 3sec &nbsp; You can view this video on Al&#8217;s YouTube Channel if needed. Video transcript Beginner traders should look for [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[159],"tags":[],"class_list":{"0":"post-45321","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-ask-al","7":"entry","8":"has-post-thumbnail","9":"override"},"featured_image_src":null,"author_info":{"display_name":"BTC Admin","author_link":"https:\/\/www.brookstradingcourse.com\/pt-br\/author\/richardhk\/"},"_links":{"self":[{"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/posts\/45321","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/comments?post=45321"}],"version-history":[{"count":0,"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/posts\/45321\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/media?parent=45321"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/categories?post=45321"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/pt-br\/wp-json\/wp\/v2\/tags?post=45321"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}