Profits from small price movements captured repeatedly throughout the session
| Strategy Type | Scalping / Ultra-Short-Term Trading |
| Market Outlook | Profits from small price movements captured repeatedly throughout the session |
| Risk Profile | High - requires precision, fast execution, and strict discipline |
| Reward Profile | Small gains per trade (5-15 ticks); cumulative profit from many trades |
| Time Horizon | Seconds to minutes per trade; multiple trades per session |
| Iv Environment | Best in moderate volatility; too quiet = no movement, too wild = erratic |
| Breakeven | Must overcome spread and commissions on each trade |
| Primary Instruments | WTI Crude CFD (USOIL), Micro WTI Futures (MCL), Full-size WTI (CL) |
| Fca Compliance | Standard instruments; scalping permitted on most UK platforms |
| Contract Specifications | $10 per $0.01 tick (1,000 barrels) • $1 per $0.01 tick (100 barrels) • $0.10-10 per $0.01 depending on position size |
| Crude Oil Scalping Characteristics | $0.01 (1 cent) • 5-15 ticks ($0.05-0.15) • CFD: 2-4 ticks; Futures: 1 tick • 20-50+ scalp setups during active session |
| Uk Platform Requirements | Sub-second order execution essential • Tick charts or 1-minute minimum • One-click trading, bracket orders • Direct market access (DMA) for futures |
| Margin Requirements | CL: ~$6,000. MCL: ~$600. CFD: 5-10% (varies by broker). |
| Cost Sensitivity | Scalping requires lowest possible spreads and commissions |
Minimum £3,000-5,000 for CFD scalping, £5,000+ for micro futures (MCL). You need enough for proper position sizing where losses don't devastate the account. £10,000 is more comfortable.
Scalping can be profitable but has a high failure rate. It requires: precise execution, strict discipline, low costs (spread/commission), significant practice, and psychological suitability. Most beginners fail; those who succeed typically practice for 6-12 months before profitability.
For UK scalpers: IG, CMC, or Pepperstone for CFDs (tight spreads, fast execution). Interactive Brokers for futures (MCL access, low commissions). Key: Tight spread (2-3 ticks max), fast execution, reliable platform.
No. Avoid scalping during high-impact news (EIA inventory, OPEC). Spreads widen, execution becomes unpredictable, and price can gap through stops. Wait 5-10 minutes after news for conditions to normalize.
Quality over quantity. Beginners: 5-10 trades maximum while learning. Experienced: 15-30 good setups available, but don't force trades. Never exceed 30-40/day - beyond that, you're likely overtrading without edge.
Enable one-click trading, set up hotkeys (practice until automatic), use bracket orders (stop/target preset), consider DOM ladder trading for futures. Physical: Stable internet, monitor setup for quick visual scanning.
Depends on risk:reward. At 1:1 R:R (8 tick stop, 8 tick target), need >55% win rate after costs. At 1:1.5 R:R (8 tick stop, 12 tick target), need >45% win rate. Higher R:R allows lower win rate. Track your actual numbers.
After 3 consecutive losses: Mandatory break. After 5+ losses in session: Stop for day. Review: Were setups valid? Was it execution? Bad conditions? Luck? Next session: Reduce size 50% until confidence returns.
Order flow (footprint charts, delta, DOM) provides edge but has learning curve. Worth adding after mastering price action scalping. Start with delta (buy vs sell volume). Graduate to footprint charts. Platforms: NinjaTrader, Sierra Chart.
Track 200+ trades minimum. Calculate expectancy: (Win% × Avg Win) - (Loss% × Avg Loss). If positive after costs, you have edge. Also track profit factor (gross wins/gross losses) - should be >1.2 minimum.
Validate over 3+ months, 200+ trades. Scale gradually: 25% increase, test 50+ trades, increase again if still profitable. Monitor metrics at each level. Scale down 50% at first sign of reduced edge. Never rush scaling.
Causes: Market structure changes, increased competition (more algos), reduced volatility, strategy becomes crowded. Monitor: Monthly expectancy trend, profit factor changes. Adapt: Modify rules, add filters, or pivot strategy.
Partial automation can help: Auto-execution of bracket orders, alerts for setups. Full automation is challenging: Requires clear rules, infrastructure, monitoring. Consider: Is your edge in pattern recognition (hard to automate) or execution (easier to automate)?
UK spread betting: Tax-free profits. CFDs/Futures: Capital gains tax applies. Keep detailed records. Consider: Incorporation may be beneficial at higher volumes. Consult accountant familiar with trading. HMRC may classify frequent traders differently.
Controversial topic. Some advocate targets (1-2% then stop) to preserve gains. Others say no target (take all good setups). Compromise: After reaching target, continue trading but with reduced size or only A+ setups.
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