Scalping is one of many trading terms in forex. When used in relation to the trading of securities, commodities and foreign exchange, can rely on a fraudulent form of market manipulation or a legitimate method of a price arbitrage gaps caused by the bid-ask spread.

Scalping in this sense is the practice of buying a security for its own account shortly before recommending that security for long-term investment and then immediately selling the security at a profit to the rise in market price following the recommendation. The Supreme Court of the United States has decided that scalping of an investment adviser acts as a fraud or deception to every customer or potential customer and constitutes a violation of the Investment Advisers Act of 1940.

The ban on scalping was applied against persons who are not registered investment advisers, and it was decided that scalping is a violation of Article 10b-5 under the Securities Exchange Act of 1934, when the heavy piece of screening plant has a relationship of trust and Confidence with the persons to whom the recommendation. The Securities and Exchange Commission has said that it is committed to stamping out scalping systems. Scalping is different from pumping stations and dumping, that a pump and dump is not a relationship of trust and confidence between the fraudster and his victims.

Scalpers try to act like traditional market makers or specialists. In order to spread to buy at the bid price and selling price on the touchstone of winning bid / ask difference. This procedure allows profit, even if the bid and ask prices do not move at all, as long as there are traders who are willing to accept market prices. It is normally used for setting up and liquidation of the situation quickly, usually within minutes or even seconds.