Scalping refers to a short-term trading strategy where traders aim to profit from small price fluctuations by making frequent and rapid trades. Scalpers typically hold positions for a very short duration, ranging from seconds to minutes, and focus on capturing small price movements multiple times throughout the day.

Scalping relies on exploiting small price differentials between the bid and ask prices in the order book. Traders execute quick trades, often using market orders, to capitalize on these price differentials, aiming to make small but consistent profits over time. Scalpers may employ technical analysis techniques, such as analyzing price charts and using indicators, to identify short-term trends and entry and exit points.

Key characteristics of scalping include high trading frequency, tight risk management, and the use of leverage to amplify potential returns. However, scalping also involves significant risks, including transaction costs (such as trading fees and slippage), volatility, and the need for rapid decision-making and execution.

Successful scalping requires discipline, focus, and the ability to react quickly to market movements. Traders must closely monitor price movements and market conditions to identify opportunities and execute trades efficiently. While scalping can be a profitable trading strategy for experienced traders, it requires skill, experience, and a thorough understanding of market dynamics to succeed.