The 5-minute «Crossing» Scalping Strategy For Contracts
Traders on the futures market often use scalping as a mode of rapidly increasing their trading capital. Despite the high risks, this trading regime is a highly profitable way of working on the market. But for effective trading in a dynamic trading mode, you will need a system that is able to respond accurately and very quickly to the most minimal technical quote reversals. As such a method of assessing price movement, we offer the “Crossing” system. The professional tools of this system allow you to accurately monitor both trend fluctuations in the liquidity of the asset and corrective rollbacks in a narrow time range. This opens up the possibility to register a large number of futures lots and leads to dynamic profiting.
To obtain the necessary instrumental markup of the trading chart, we will need to use a set of indicators that are currently not available on specialized trading platforms for trading futures contracts. However, this problem can be easily solved by using an additional resource in the form of the service of live charts from tradingview.com. This auxiliary service allows you to work on any exchange instrument using the necessary analysis resources. To create the technical template for the “Crossing” system, you need to configure the following set of tools from the public indicator library:
- The COG Double Channel. Use it in the standard settings to build the channel of market price movement. This technical analysis tool will allow you to build an asset price channel that will not only take into account the average and extreme market values, but also the highs and lows of the market in the event of volatility in quote movement. Thus, we get the widest range of indicators necessary for effective trading on the futures market.
- The Wave Trend with Crosses. We also apply the standard settings of this service. We need an oscillator as an auxiliary tool to confirm reversals of quote movement and determine the relative strength of market fluctuations during new trend formation. This service will allow you to filter the signals of the main strategy tool and will open up the opportunity to increase the accuracy of your trading signals.
In order to work in scalping mode, we need to estimate the minimum market range with the help of indicators. The instrument settings show excellent results when working on the minute time frame of the technical chart, so we recommend this period for optimal system operation. After setting up the chart and configuring the analysis tools, the strategy will display the following markup:
Technical signals of the system
For market lots UP, the following system of strategy signals operates:
- Quotes in the process of building touch or leave for a short period of time the green zone of the COG Double Channel indicator, after which they reverse to form a correction or a new trend
- The oscillator of the Wave Trend with Crosses indicator forms an intersection and divergence of the movings upwards, while the sine wave of the histogram rises above the zero level of the scale
For market lots DOWN, the following system of strategy signals operates:
- Quotes in the process of building touch or leave for a short period of time the red zone of the COG Double Channel indicator, after which they reverse to form a correction or a new trend
- The oscillator of the Wave Trend with Crosses indicator forms an intersection and divergence of the movings downwards, while the sine curve of the histogram falls below the zero level of the scale
The toolkit of the system allows you to clearly monitor market trends with a formation duration of up to 10 minutes. To most effectively process the trading signals of the strategy, we recommend working on the market with 5-minute contracts. Thus, forecast processing will occur during a period of maximum probability of profiting.
Given the dynamics of trading, as well as the level of risks associated with trading futures with minimal expiration rates, we recommend that you use lots with the level of funds involved not exceeding 2-3% of the investment account balance. If you are using an account with the initial amount of trading funds, work with lots of the minimum cost on your platform.