Digital Scalping Strategy for the 1-Minute Forex Chart
Digital scalping is one of the most popular short-term trading methods, especially among experienced forex traders. The idea is to capture as many pips as the market offers over a very short holding time. This article explains a digital scalping strategy step by step.
Digital Scalping Strategy
What the Strategy Needs
This strategy uses two technical indicators, each with its own role:
- Relative Strength Index (RSI)
- Volume indicator
The indicators used are the widely used Relative Strength Index (RSI) and the volume indicator.
Time Frame for the Digital Scalping Strategy
This strategy relies mainly on the 1-minute time frame, which provides many opportunities to work with in the market. It can also be used on higher time frames such as the 5-minute chart, but it should not be used on larger time frames, because it depends on capturing a small number of pips, which is hard to do on higher time frames.
How the Digital Scalping Strategy Works
We will break the rules of the strategy into steps to make it easier to explain and follow. Read on:
1- Add the indicators and tools to the chart
The first thing to do is set up the chart with everything you need, which are the indicators mentioned above. Look at the image below.
In the image above we set up the chart with the technical indicators we need, which are the Relative Strength Index and the volume indicator.
2- Identify the trend
After setting up the chart, we now need to identify the prevailing trend in the market, because this strategy relies mainly on trending moves rather than reversals. To identify the trend, we look at the 15-minute and 30-minute time frames. Look at the image below.
The 15-minute chart above shows that the prevailing trend is up, since price is making a higher high.
More: Explained best scalping and swing trading strategies
3- Place buy orders
Now we go back to the 1-minute time frame. What we need now is to wait for any correction on the chart, then look for buy opportunities after the indicators signal that this correction has ended. But how do we know the correction is over?
The answer lies in the role of the volume indicator, which often points to the number of sellers and buyers currently in the market. Look at the image below.
In the image above you will notice that price was in a downward correction, and when we look at the volume indicator we see that positive pressure has entered the market, as marked at the first arrow on the indicator. The size of the candle does not match the reading of the indicator, which means hidden pressure has entered the market.
Despite this pressure, the trend has not changed yet; it is waiting for another signal, which will come from the RSI and is also preceded by hidden pressure at the second arrow. After all these confirmations, you can enter a buy trade.
To understand the volume indicator well, look at its reading at the third arrow, which shows that hidden pressure entered the market and caused this decline.
Read also: Full explanation of the false breakout strategy
Setting Take-Profit and Stop-Loss
The stop-loss order goes at the lowest point price reached, which will usually be no more than 7 pips. If it is more than that, it is better not to enter the trade.
The take-profit order will be 10 pips, since we are capturing a limited number of pips, because the 1-minute frame cannot offer more than that. Look at the image below.
In the image above you will notice that price gave us two trades that reached the target successfully, and you will see that the stop-loss order was fully respected.
Before using a digital scalping strategy in forex, it is important to understand currency liquidity and volatility, and the pros and cons of this trading style.
On liquidity in forex trading, foreign-exchange transactions are worth $6.6 trillion per day, which makes it the most liquid market in the world.
Liquidity refers to the ability to buy and sell quickly without affecting the market price. High liquidity makes a digital scalping strategy in the forex market a suitable approach for scalpers who sometimes need to enter and exit their positions quickly, within seconds.
Currency liquidity is not fixed and changes based on a number of factors, including the time of day, the number of active traders in the market at any moment, and broader economic conditions such as inflation rates in different countries. The most liquid currency pairs tend to be the most traded with a digital scalping strategy, such as EUR/USD, GBP/USD and USD/JPY.
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Read also:
- Explained: the strongest scalping indicator
- Best scalping strategy 2026
- Best Bollinger Bands scalping strategy
- Best 1-minute scalping strategy explained
Frequently Asked Questions
How do I succeed at trading stocks?
- Always use a trading plan.
- Treat trading like a business.
- Use technology.
- Protect your trading capital.
- Study the markets.
- Risk only what you can afford to lose.
- Develop a trading methodology.
- Always use a stop-loss order.
How do you become a professional trader?
- Learn the basics of trading.
- Learn the advanced basics.
- Develop trading systems and techniques.
- Gain trading experience.
- Consider paper trading.
- Choose a trusted broker.
- Learn to focus.
- Understand risk management.
What is the best strategy on the 1-minute frame?
Scalping is the best trading strategy on the 1-minute time frame. This strategy relies on trend following and trend reversal. Traders should choose their scalping timing very carefully.
What is scalping?
Scalping is a trading style that specializes in profiting from small price changes and making a quick profit from reselling. In day trading, scalping is a term for a strategy that prioritizes making large numbers of small profits.
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