Scalping is one of the most exciting and fast-paced trading styles in the market. If you thrive on quick decisions and rapid trades, 1-minute scalping might be perfect for you. In this guide, we will cover everything you need to know about scalping, from basic concepts to advanced strategies.
What is Scalping?
Scalping is a trading strategy that involves making dozens or even hundreds of trades per day, aiming to profit from small price movements. Scalpers typically hold positions for just seconds to a few minutes, capturing tiny gains that add up over time.
Key Insight: Successful scalpers do not need big moves. They profit from many small wins, often targeting just a few cents per share or a few ticks per trade. Consistency and discipline are more important than finding home runs.
Why Trade the 1-Minute Chart?
The 1-minute timeframe is the most popular choice for scalpers because it provides:
- Maximum opportunities: More candles mean more potential trade setups throughout the day
- Quick feedback: You know within minutes whether your trade idea is working
- Precise entries: Fine-tune your entries and exits with granular price data
- Reduced overnight risk: All positions are closed by end of day, eliminating gap risk
Essential Tools for 1-Minute Scalping
1. Fast and Reliable Platform
Your trading platform must execute orders instantly. Even a one-second delay can turn a winning trade into a loss when scalping. Look for platforms with direct market access and fast order routing.
2. Level 2 Quotes and Time and Sales
Understanding order flow is crucial for scalping. Level 2 shows you the depth of the market, while time and sales (the tape) shows actual transactions happening in real time.
3. Key Indicators
Most scalpers keep their charts clean, but these indicators can help:
- VWAP (Volume Weighted Average Price): Acts as dynamic support and resistance
- EMA 9 and EMA 20: Fast moving averages that show short-term trend direction
- Volume: Confirms the strength of price moves
Top 1-Minute Scalping Strategies
1. VWAP Bounce Strategy
This strategy uses VWAP as a magnet for price action. Stocks often return to VWAP and bounce off it.
How to Trade It
- Wait for price to pull back to VWAP
- Look for a rejection candle (hammer, doji, or engulfing pattern)
- Enter in the direction of the prevailing trend
- Set stop loss just beyond VWAP
- Target 2:1 reward to risk ratio
2. Opening Range Breakout
The first 5 to 15 minutes of the market establish a range. Scalpers trade breakouts from this range with momentum.
How to Trade It
- Mark the high and low of the first 5 or 15 minutes
- Wait for price to break above or below this range with volume
- Enter on the breakout candle close
- Stop loss at the opposite side of the range
- Trail your stop as the move continues
3. Moving Average Crossover
When the 9 EMA crosses above the 20 EMA, it signals bullish momentum. When it crosses below, it signals bearish momentum.
4. Support and Resistance Scalping
Identify key levels from higher timeframes and scalp reactions at these levels on the 1-minute chart.
Risk Management for Scalpers
Risk management is even more critical for scalpers because you take so many trades. One bad trade can wipe out many small wins.
- Risk no more than 1% per trade: With a $50,000 account, risk no more than $500 per trade
- Use hard stop losses: Never hope a losing trade will come back. Cut losses quickly
- Set a daily loss limit: Stop trading if you lose 3% of your account in a day
- Take profits consistently: Do not get greedy. Take your planned profit and move on
Pro Tip: Many successful scalpers have win rates around 50 to 60 percent. They profit because their average winner is larger than their average loser, not because they win every trade.
Best Times to Scalp
Not all market hours are equal for scalping. Focus on these high-volume periods:
- Market Open (9:30 to 10:30 AM ET): Highest volume and volatility
- Midday Reversal (11:30 AM to 12:30 PM ET): Markets often reverse direction
- Power Hour (3:00 to 4:00 PM ET): Volume picks up as institutions position before close
Best Stocks for Scalping
Not every stock is suitable for scalping. Look for:
- High volume: At least 1 million shares per day average volume
- Tight spreads: The bid-ask spread should be 1 cent or less
- Volatility: The stock should move enough to provide opportunities
- News catalysts: Stocks with news often have increased activity
Common Scalping Mistakes to Avoid
- Overtrading: Taking trades just to be in the market leads to losses
- Ignoring the spread: The bid-ask spread is a real cost that eats into profits
- No stop losses: One big loss can destroy a week of profits
- Trading during low volume: Avoid the midday lull when spreads widen
- Chasing trades: If you miss an entry, wait for the next setup
Building Your Scalping Routine
Successful scalpers follow a consistent daily routine:
- Pre-market preparation: Review overnight news, identify stocks in play, mark key levels
- Trading session: Execute your plan with discipline, take breaks when needed
- Post-market review: Log every trade, analyze what worked and what did not
Track Every Scalping Trade Automatically
Pro Trader Dashboard syncs with your broker to automatically log every trade, calculate your win rate, and show you which strategies are actually making money. Essential for high-frequency scalpers.
Is Scalping Right for You?
Scalping is not for everyone. Consider these factors:
- Time commitment: You need to watch the screen constantly during trading hours
- Emotional control: Quick losses require strong mental discipline
- Capital requirements: Pattern day trader rules require $25,000 minimum for US stocks
- Transaction costs: Commissions and fees add up quickly with many trades
Summary
1-minute scalping is a demanding but potentially rewarding trading style. Success requires the right tools, solid strategies, strict risk management, and emotional discipline. Start with paper trading to develop your skills before risking real money, and always track your trades to identify what works best for your style.
Ready to explore other timeframes? Learn about 5 and 15 minute chart trading or discover multi-timeframe analysis to improve your entries.