Why would a broker not like scalping?
Why would a broker not like scalping?
Market Makers make money when we open positions. They earn from the spreads (and commission if they so charge).
When we open positions, Market Maker would hedge it against other traders OR they may pass it directly into the interbank markets. During slow Market, brokers may opt to take our position and wait for any other trader to take a counter position – this may take 1, 2, 3 or 5 minutes and if no traders took our position, they will pass it to the interbank. But if my position was closed too soon (and if in profit) while it is not hedged, the broker loose money to me – they wont like it.
Therefore, IF a broker dont like scalping, it implies that they are this kind of broker who play games against the trader. CRAP I wont trade with such a broker.
BurgerKing, forexfactory.com