Scalping vs Day Trading in 2025: Which Is Right for You?

Scalping vs Day Trading in 2025: Which Is Right for You?

Reading time: 8 minutes

Although trading can seem complicated, traders work with four primary trading styles. Medium- to longer-term trading styles consist of ‘swing trading’ and ‘position trading’, while at the other end of the spectrum, short-term trading styles (sometimes referred to as ‘intraday’) include ‘scalping’ and ‘day trading’, which are the focus of this post. While both styles exhibit similarities, given both are short-term trading approaches and are traded across several key asset classes – such as Currencies (Forex), Stocks, Commodities, and Bonds – they differ in several ways.

Exploring Scalping and Day Trading

Out of all four trading styles, scalping the financial markets involves a higher frequency of trading; for some, this can mean several trades taken in short succession during the day, targeting small, frequent gains, generally with large position sizes. Timeframes used among scalpers range from seconds to 5-minute periods. 

On the other hand, day trading is slower-paced than scalping, with maybe only one or two well-planned trades executed daily. A day trader aims to capitalise on short-term positions that could be active from a few minutes to several hours during a trading day. The day trading timeframes range from the 15-minute and 1-hour charts. Given less frequency of trades, a day trader will often have more time to prepare than a scalper will. Despite this, scalpers and day traders aim to be flat by the end of their trading day. 

Day traders – and scalpers – may monitor the higher timeframes to be aware of larger trends, as well as support and resistance levels that could either increase the odds of a trading opportunity or serve as a warning sign that may hinder a trade’s performance. What these higher timeframes are will be trader-dependent. For example, a day trader may look to the H4 or daily timeframe’s trends, while a scalper may opt for the H1 chart. 

Liquidity and Volatility 

Both scalpers and day traders require liquid markets and, therefore, choose instruments that are easy to buy and sell – think major currency pairs and blue-chip stocks. Additionally, both trading styles need markets with sufficient volatility (price fluctuations) and reasonable commissions/fees. Low transaction costs are imperative to operating shorter-term strategies given the number of trades a day trader and scalper execute. 

Time at the Desk

Time at the desk can differ between day trading and scalping. A scalper based in Australia may trade the majority of the Asian session (this consists of the Sydney and Tokyo sessions [between 8 am Sydney time and 6 pm Tokyo time]) and possibly some of the London session (between 8 am and 5 pm London time). A scalper in the US will likely trade the London and US overlap session (this is where the US morning session begins and London enters its afternoon session, generally between 8 am and midday US time). The point to understand is that a key characteristic of scalping is constant attention, a disciplined nature, and perhaps long periods of trading and stress. This type of trading style can appeal to those working part-time or wanting to trade in the evening after work. Although long hours at the desk are also sometimes required for a day trader, this approach can offer more freedom given the lower frequency of trades. A day trade may run for several hours daily and just require periodic monitoring. That being said, like the scalper, in-depth research is required in day trading. 

Strategies

Many analysts and traders say that scalping the markets is a ‘technical field’: traders will rely on technical analysis to conduct their trading activities. Although a scalper will use technical analysis as one of their primary tools, fundamental analysis is also important for many scalpers. For example, Forex traders will use macroeconomic analysis to trade ‘into and out of’ economic events and Stock traders will analyse companies and trade earnings results. Both these trading strategies require a comprehensive knowledge of technical and fundamental analysis. It is important to note that a scalp trade may also merge into a day trade; experienced traders can switch between the two styles of trading based on market conditions. With that said, trading strategies employed by scalpers and day traders will be similar, though trade and risk management differ based on the time a trade is open and risk exposure. 

Strategies employed by both trading styles will be specific to their trading approach; as mentioned above, all strategies will be short-term. This can be achieved in many ways, including breakout systems, which focus on trading a market following a move beyond a technical level, such as a support or resistance or a moving average. The signal to buy and sell might include filters before committing. For example, traders may require a closing candle to form beyond the level of interest; some may seek a time filter (price action must remain beyond the level for a set time before committing); other methods can include technical indicators, like Pivot Point levels or the Bollinger Bands. 

News trading is another common scalping and day trading strategy. It usually involves ‘trading out of event risk’, which means you need a solid understanding of the fundamental side of your traded market. You formulate trading ideas based on the outcome of the release and usually set your profit objective based on a technical level. This is a common approach for Forex and Stock traders. 

The risk-reward ratio for scalping strategies, however, is often unfavourable. While day traders will likely target at least a 1:2 risk-reward ratio – meaning the ‘reward’ of a trade would be two times the risk (for example, risk US$50 to make US$100), a scalper may work with a 2:1 risk-reward ratio at times. However, most scalpers will aim for at least a 1:1 risk-reward ratio and profit from a higher win rate.

Which Trading Style is Right for you?

Without knowing your financial situation, your experience level, and your goals with trading, it is impossible for this article to identify which trading style is right for you. Nevertheless, this post should have given you something to think about and more of an idea about what is involved with each trading style.

For example, scalping or day trading could be worth exploring if you have a part-time job and plenty of time during the day. Still, having a full-time job and other personal obligations outside of work hours would make either style somewhat difficult to adopt. This is when you might consider looking into swing trading or position trading, which, as noted, are more targeted towards a medium- and longer-term approach.

It is vital to understand that commissions and fees must be carefully considered irrespective of whether you day trade or scalp the markets. This is because you will execute more trades as a short-term trader, which can cut into your bottom line. As a result, many scalpers and day traders choose to trade liquid instruments which provide enough volatility to trade.

FAQs:

1. What is Scalping?

Scalping is a short-term trading style that involves executing several trades per day, with durations ranging from a few seconds to 5 minutes.

2. What is Day Trading?

Day trading is a short-term trading style that entails opening one to three trades per day, which can last from a few minutes to several hours. 

3. Is scalping or day trading right for you?

Whether scalping or day trading is a good fit for you can be determined by assessing your current financial and personal situation. Scalping is faster-paced and generally requires more time on the screens. Although day trading is also ‘screen time intensive’, you generally have more freedom given the lower frequency of trades.