Are Forex Scalpers Illegal? by www.forexblacklist.com
Introduction There are many forex brokers out there who have labeled using forex scalpers as illegal and may also go so far as to freeze your account if they find out that you are, in fact, using a scalper to trade. However, the fact of the matter is that using forex scalpers is 100% legal and is an excellent way to trade but the big reason why many brokers hate it is because it upsets their strategy of ensuring that you lose every trade you make. Brokers that are in the market against you will often ban the use of scalpers by people on their system simply because it will be hard for them to get into the market against you and make a profit.
Introduction For people who are new to forex trading â€˜scalpingâ€™ refers to a method of trading, which requires quickly opening and then liquidating positions. How fast a position is opened and then liquated is up to the trader or the type of scalping system he or she is using but generally speaking the time frame tends to be between 35 minutes while many scalpers will not hold a position for over a minute.
Which brokers allow the use of forex scalpers? It is important to understand that all forex brokers are different, there are various types of brokers, which can broadly be classified as dealing desk and no dealing desk (NDD). Only NDD forex brokers allow traders to scalp the market and will not close your account if they see you not holding positions for over a minute. The reason why NDD brokers will allow scalping is because the prices you see are real, and it is what the market is currently offering, so no requoting of prices, which turns out to be more beneficial for traders since the spreads are lower but not fixed. Most NDD brokers make money by charging a commission on every trade or may increase the spread. Since they are not in the market against you and hoping that you lose, they allow for using scalping strategies to make money off the market.
Which brokers allow the use of forex scalpers? â€˘ If you are not sure which brokers are NDD and, which are not you can simply call up the forex broker and ask if they allow scalping. Many forex brokers online who are trading against you will make it clear that they do not tolerate scalping and will freeze your account, that way you know for sure that they are not NDD brokers. â€˘ Choosing a reliable broker is only one of the many steps to Forex profits. Another important one is choosing a strategy to use. 95% of the strategies being unprofitable, you should check http://www.ForexBlacklist.com to see which you should avoid and which are relatively safe.