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Riskreward

Trading AUDUSD | Judas Swing Strategy 26/02/2025Last week the Judas Swing strategy had another action-packed week! As we took four trades across our selected currency pairs ( FX:GBPUSD , FX:AUDUSD , FX:EURUSD , OANDA:NZDUSD ), securing two wins and two losses, but still closing the week with a solid 2% gain. Given the strategy’s consistency over the past few weeks and months, we were eager to see how it would perform this week. On Monday, we waited for a setup on FX:EURUSD , but it fell just a few pipettes short of meeting all the criteria on our checklist. Since one key requirement wasn’t met, we stayed disciplined and skipped the trade. Now, here’s the important part—although that trade ended up being a winner, it didn’t bother us. Why? Because it didn’t align with our strategy, and we don’t risk our hard-earned money on trades that don’t check all the boxes. If you find yourself entering random trades, it’s time to create a checklist and stick to it. Discipline is what separates consistent traders from gamblers. Fast forward to Wednesday, we spotted a promising setup on FX:AUDUSD and we were eager to see how the session would unfold. After a sweep of liquidity at the lows, our focus immediately shifted to potential buying opportunities. Once we got a break of structure to the upside, all that was left was a retrace into the FVG before executing the trade. But patience was key—we reminded ourselves of Monday’s setup, where a similar scenario played out, yet the retrace never came. That trade had to be left behind, and we weren’t about to force an entry this time either Finally, price retraced into the FVG, and as soon as that candle closed, we were ready to execute the trade. We risk 1% per trade with the goal of securing a 2% return ensuring our wins outweigh our losses over time. With this strategy’s win rate hovering around 50%, sticking to our rules keeps us on the path to long-term profitability After entering the trade, we experienced a slight drawdown for less than five minutes, dipping just 2 pips nothing out of the ordinary. Our entry candle had closed in our intended direction, so we stayed patient. Soon after, price moved decisively in our favor, hitting our target in just 1 hour and 10 minutes. Our patience paid off this time with a solid 2% return on a trade where we had only risked 1%.
by CleoFinance
TRADING LEVERAGE | How to Manage RISK vs REWARDFor today's post, we're diving into the concept " Risk-Reward Ratio " We'll take a look at practical examples and including other relevant scenarios of managing your risk. What is considered a good risk to reward ratio and where can you see it ? This applies to all markets, and during these volatile times it is an excellent idea to take a good look at your strategy and refine your risk management. You've all noticed the really helpful tool " long setup " or " short setup " on the left-hand column. This clearly identifies the area of profit (in green), the area for a stop-loss (in red) and your entry (the borderline). It also shows the percentage of your increases or decreases at the top and bottom. It looks like this : 💭Something to remember; It is entirely up to you where you decided to take profit and where you decide to put your stop loss. The IDEAL anticipated targets are given, but the price may not necessarily reach these points. You have that entire zone to choose from and you can even have two or three take profits points in a position. Now, what is the Risk Reward Ratio expressed in the center as a number.number ? The risk to reward ration is exactly as the word says : The amount you risk for the amount you could potentially gain. NOTE that your risk is indefinite, but your gains are not guaranteed. The risk/reward ratio measures the difference between the entry point to a stop-loss and a sell or take-profit point. Comparing these two provides the ratio of profit to loss, or reward to risk. For example, if you're a gambler and you've played roulette, you know that the only way to win 10 chips is to risk 5 chips. Your risk here is expressed as 5:10 or 5.10 .You can spread these 5 chips out any way you like, but the goal of the risk is for a reward that is bigger than your initial investment. However, you could also lose your 5 and this will mean that you need to risk double as much in your next play to make up for your loss. Trading is no different, (except there is method to the madness other than sheer luck...) Most market strategists and speculators agree that the ideal risk/reward ratio for their investments should not be less than 1:3, or three units of expected return for every one unit of additional risk. Take a look at this example: Here, you're risking the same amount that you could potentially gain. The Risk Reward ratio is 1, assuming you follow the exact prices for entry, TP and SL. Can you see why this is not an ideal setup? If your risk/reward ratio is 1, it means you might as well not participate in the trade since your reward is the same as your risk. This is not an ideal trade setup. An ideal trade setup is a scenario where you can AT LEAST win 3x as much as what you are risking. For example: Note that here, my ratio is now the ideal 2.59 (rounded off to 2.6 and then simplified it becomes 1:3). If you're wondering how I got to 1:3, I just divided 2.6 by 2, giving me 1 and 3. Another way to express this visually: In the first chart example I have a really large increase for the long position and you can't easily simplify 7.21 so; here's a visual to break down what that looks like: If you are setting up your own trade, you can decide at what point you feel comfortable to set your stop loss. For example, you may feel that if the price drops by more than 10%, that's where you'll exit and try another trade. Or, you could decide that you'll take the odds and set your stop loss so that it only triggers if the price drops by 15%. The latter will naturally mean you are trading at higher risk because your risk of losing is much more. Seasoned analysts agree that you shouldn't have a value smaller than 5% for your stop loss, because this type of price action occurs often during a day. For crypto, I would say 10% because we all know that crypto markets are much more volatile than stock markets and even more so than commodity markets like Gold and Silver, which are the most stable. Remember that your Risk/Reward ratio forms an important part of your trading strategy, which is only one of the steps in your risk management program. Dollar cost averaging is another helpfull way to further manage your risk. There are many more things to consider when thinking about risk management, but we'll dive into those in another post.
by CryptoCheck-
2
MOG Long Spot Opportunity Market Context: MOG has retraced significantly from its all-time high but continues to maintain an upward trend—a rarity among meme coins. Price is approaching a critical support zone, presenting a strong risk-to-reward opportunity for a long trade. Trade Details: Entry Zone: $0.0000012 Take Profit Targets: $0.0000025 $0.0000030 $0.0000035 Stop Loss: Daily close below $0.0000010 This setup provides an excellent opportunity to capitalize on a potential higher low formation as MOG attempts to reclaim support. Manage risk carefully! 📈
Long
by Richtv_official
Demand Zone Signals Opportunity for WLDUSDT The market structure for BINANCE:WLDUSDT remains bullish as long as the swing low at $1.58 is not broken. Recent price action suggests a favorable entry point in the demand zone between $1.58 and $1.92 . The next significant target is at $4.19 , a historically reactive zone where previous price movements have faced strong resistance. This level aligns with the bullish market structure and offers a high-profit potential. This trade setup presents an impressive risk-to-reward ratio of 1:6 , making it an appealing opportunity for traders. Maintaining the structure above the demand zone is crucial for bullish continuation. However, a break below $1.58 would invalidate this idea and could signal a bearish shift. 👨🏻‍💻💭 Do you think WLDUSDT can hold the bullish structure and hit $4.19? Share your thoughts or ideas below and let’s discuss this setup! __________________________________________________________________ The information and publications within the 3Commas TradingView account are not meant to be and do not constitute financial, investment, trading, or other types of advice or recommendations supplied or endorsed by 3Commas and any of the parties acting on behalf of 3Commas, including its employees, contractors, ambassadors, etc.
Long
by 3Commas
Understanding Risk Asymmetry in a Table▮ Introduction With TradingView's new table creation feature , you can easily create and customize tables to enhance your trading analysis and presentations. In this article I'll use it to explain Risk Asymmetry . Trading involves a constant evaluation of risk and reward . One of the critical concepts that traders need to understand is risk asymmetry . This concept highlights how losses and gains are not symmetrical. In other words, the percentage gain required to recover from a loss is greater than the percentage loss itself. This article explores risk asymmetry and illustrates it with a practical example. ▮ What is Risk Asymmetry? Risk asymmetry refers to the disproportionate relationship between losses and the gains required to recover from those losses. For instance, if you lose 10% of your investment, you need to gain more than 10% to get back to your original amount. This is because the base amount has decreased after the loss. Understanding risk asymmetry is crucial for traders because it affects their risk management strategies. Knowing that larger losses require exponentially larger gains to recover can help traders make more informed decisions about their trades and risk exposure. ▮ Illustrating Risk Asymmetry To illustrate risk asymmetry, let's consider an initial investment of $1000. The table below shows the required gain to recover from various percentage losses: Explanation: - Loss (%): The percentage loss from the initial amount. - Value Lost ($): The lost monetary value from the initial amount. - Amount After Loss ($): The remaining amount after the loss. - Required Gain for Recovery (%): The percentage gain required to recover to the initial amount. This table highlights the asymmetry in trading losses and gains. As the loss percentage increases, the required gain to recover the initial amount increases disproportionately. For example, if you lose 50% of your initial amount ( $500 ), it is not enough for you to gain 50% , because the amount left after the loss is $500 , and a 50% gain on the amount of $500 is $250 , which would result in a total amount of $750 with a remaining loss of $250 ! So, the most important question is not how much can I win , but how much can I lose . Curiosity: Why 100% is not applicable (-) in this table? When you lose 100% of your investment, you have lost all your capital. Therefore, there is no remaining amount to recover from, and it is impossible to gain back to the initial amount from zero. This is why the required gain are marked as not applicable. ▮ Conclusion Understanding risk asymmetry can help traders in several ways: 1. Risk Management: traders can set stop-loss levels to limit their losses and avoid the need for large gains to recover. 2. Position Sizing: by understanding the potential impact of losses, traders can size their positions more conservatively. 3. Psychological Preparedness: knowing the challenges of recovering from significant losses can help traders maintain discipline and avoid emotional decision-making. It is one thing to lose 100% of a dollar on a casino bet; it is quite another to lose 100% of a lifetime's worth of capital. Therefore, the larger the capital at stake, the smaller the amount of money that should ideally be risked.
OANDA:SPX500USDEducation
by andre_007
5
Risk Management in Trading: Keeping It Simple and Stress-FreeIf you're new to trading, you’ve probably heard the golden rule: “Don’t risk more than 1-2% of your account on a single trade.” Sounds easy, right? But let’s be real—trading is way more than just crunching numbers. Let’s Break It Down 1. Don’t Bet the Grocery Money! 🍎 First things first: Never trade with money you can’t afford to lose. Imagine this—your rent is due next week, but instead of saving, you decide to trade all that cash because you’re feeling lucky. Spoiler alert: That’s not luck—it’s a one-way ticket to Stress City. When you trade money you can’t afford to lose, every market wobble feels like the end of the world. Keep your bills paid and your pantry stocked before you even think about trading. Example: Think of trading like buying lottery tickets. You wouldn’t spend your entire paycheck hoping to hit the jackpot, right? (Well, I hope not!) Treat your trading account the same way. 2. Discipline > Math 🧠 Sure, knowing the 1% rule is cool, but what really matters is sticking to it. Here’s the thing: Losing streaks happen to everyone—even pros. The question is, how many losses in a row can you handle without losing your cool and going all-in on a “revenge trade”? Example: Think of it like a diet. You promise to eat just one cookie, but after a bad day, you eat the whole pack. The same thing happens in trading if you’re not disciplined. One bad trade can lead to a whole bunch of bad decisions. 3. Trading Won’t Pay Your Bills (At Least Not Yet) 💸 Many people dream of quitting their job to trade full-time. Sounds great, but here’s the catch: You need a lot of money to make trading your main income source. The trader in the video suggests keeping a day job while learning the ropes. That way, you’re not relying on trading profits to survive. Example: Imagine opening a lemonade stand, but you only have two lemons. You can’t expect to make enough lemonade to pay rent! Work on growing your “lemon supply” (your trading skills and capital) before you go all-in. 4. Watch Your Trade Count 🕒 Making too many trades in one day is like eating too much junk food—it might feel good at first, but it’ll cost you later. Even small risks add up quickly when you’re overtrading. The pros call this “death by a thousand cuts.” Example: If you take 10 trades in a day, risking 1% each, you’re suddenly risking 10%. That’s like ordering 10 desserts because “they’re just tiny.” Spoiler: It adds up fast. 5. Learn from Poker Players 🎲 Ever watched poker pros on TV? They don’t bet everything on one hand—they manage their “bankroll” carefully, so they don’t lose it all. The same idea works in trading. Lower your position size when things aren’t going well so you can stay in the game. Pro Tip: Want a fun exercise? Use poker chips or fake money to practice “betting” on trades. Seeing your stack shrink will remind you why managing losses is so important. Simple but Powerful Lessons Build a Safety Net: Before you think about trading full-time, save up enough money to cover your expenses for a few months. This way, you can trade without freaking out over every dollar. Learn a Backup Skill: Trading takes time to master. While you’re learning, keep a steady job to support yourself financially. Focus on the Process, Not the Profits: Winning traders don’t obsess over the money—they focus on following their strategy and improving their skills. A Few Quotes to Keep in Mind “Risk management isn’t about numbers; it’s about discipline.” “If losing money makes you panic, you’re trading too much.” “Turn off the profit and loss display—focus on making good trades.” Final Thought: Keep It Chill Trading is like a marathon, not a sprint. Take your time, stick to your plan, and never risk more than you’re comfortable losing. If you approach it with patience and discipline, you’ll not only survive but thrive in the markets. Now, go grab a coffee (or lemonade) and plan your next trade with confidence! ☕🍋 Hope you enjoyed the content I created, You can support with your likes and comments this idea so more people can watch! ✅Disclaimer: Please be aware of the risks involved in trading. This idea was made for educational purposes only not for financial Investment Purposes. --- • Look at my ideas about interesting altcoins in the related section down below ↓ • For more ideas please hit "Like" and "Follow"!
Education
by Crypto4light
1
FIL/USDT Short Setup on Rising Channel BreakdownThis chart showcases a short position on FIL/USDT after a breakdown from a rising channel pattern. The price respected the upper and lower boundaries of the channel before breaking below the support, signaling a potential bearish continuation. Key Levels Entry Price: Around 5.39 (near the channel breakdown point) Stop Loss: Set at 5.59 (above recent resistance) Take Profit Target: Approximately 4.73 (aligned with prior support and pattern projection) Technical Insights Rising Channel Pattern: Generally bearish when a breakdown occurs, indicating a loss of bullish momentum. Bearish Confirmation: A strong downside move with momentum below the lower trendline enhances the validity of this setup. Risk-to-Reward Ratio: The setup offers a good R:R, making it an efficient short trade opportunity if market conditions align. Traders can watch for further confirmation, such as volume spikes or retests of broken support levels acting as resistance, before adding to their positions.
Short
by wolfchemist
11
UNI/USDT Short PositionThis chart illustrates a short position on UNI/USDT following a potential bearish breakout from an ascending wedge pattern. The price action has been respecting the upper and lower trendlines, forming higher highs and higher lows. However, the breakdown below the lower support trendline signals a reversal. Key Levels - Entry Price: Near 13.90 (just below the breakdown point) - Stop Loss: Around 14.27 (above the wedge resistance) - Take Profit Target: 12.12 (aligned with key support levels and pattern height projection) Technical Insights Rising Wedge Pattern: Typically bearish, indicating weakening bullish momentum before a potential decline. Bearish Confirmation: The strong bearish candlestick closing below the wedge support adds confidence to the short setup. Risk-to-Reward Ratio : This trade offers a favorable R:R, approximately 1:2.5, making it an attractive short opportunity. Watch for additional confirmations like increasing volume on the breakdown or retests of the former support turned resistance to add confluence.
Short
by wsaetos
AGLD/USDT, Ascending Channel with 2:6 Risk-Reward SetupThis chart displays an Ascending Channel Pattern where the price is trending upward within parallel support and resistance lines. The long position designed here follows a 2:6 risk-reward ratio , indicating a calculated trade setup with a potential 50% profit at the target price of $3.717 and a controlled 18% loss at the stop-loss of $2.016 . The ascending channel suggests bullish momentum, and the strategy aligns with a breakout continuation toward the upper resistance level. However, if the price fails to sustain above the lower trendline, the trade could hit the stop-loss. This setup offers a favorable risk-reward profile for traders looking to capitalize on the channel's upward trajectory.
Long
by wolfchemist
8
USD/JPY SELL SET UP!USD/JPY Sell Set-Up I have identified good levels for a short-term sell on USD/JPY with a favorable risk/reward ratio. The current market structure suggests a potential move downward, making this setup ideal for traders looking for short opportunities. 🔑 Key points to keep in mind: Always use a stop loss to manage risk effectively. Ensure your position size aligns with your trading plan and risk management strategy. Wishing everyone good luck and successful trades!
Short
by MoneyMavenFX
LULU, a stock to watch!Lululemon stock (LULU) has traded down into the $230's for the first time since the COVID-19 Crash of 2020. I believe that LULU is a stock to keep your eye on, for a few reasons. - The stock is trading at a 20x p/e whereas its historical p/e is in the mid 40's. - Margins for the company have all been steady, and remain an industry leader. - Lululemon is still set to see 10% CAGR for EPS in the next 5 years. (consensus) - The stock is seeing a severe correction, on par with its past decade corrections. Above is bullish sentiment on LULU, and can be considered the "bull/base case" Personally, I have not turned bullish on LULU yet, but with the levels it is reaching it has most certainly caught my eye and has been added to my watch list. While the stock is seeing oversold levels, I think the midterm outlook can still remain bearish for Lululemon. Below are reasons why the short/midterm outlook for LULU may not be optimal. - Weaker forward projections compared to last 5 years. Though LULU is expecting 10% CAGR EPS for the next 5 years, that is just a fraction of its last 5 year CAGR of 38.55%. While projections are still positive, they have certainly dampened compared to recent years' growth. - Macroeconomic environment. Though the economy remains hot/fine for now, there have been warning signs flashing of a rising unemployment figure across the country. With suboptimal economic conditions, the average consumer may cut down on expensive Lululemon clothing. These Macro conditions may also continue to dampen the economy, which can cause an overall market correction, where LULU would likely follow the sentiment. Overall, I believe that LULU offers significant reward, but the shorter term horizon is still worrisome for Lululemon and the global economy. Lululemon is a leader in the Retail Trade sector and dominates when it comes to profitability. The stock is definitely one to keep an eye on if it continues to get crushed. Regarding technicals, I am watching this demand zone around the 200 level. The stock could trend down to this area, and reach close to COVID-19 lows if sentiment does not change. This area could also offer significant R/R for an entry point. Disclosure: I currently hold no position in LULU stock, and have never been a shareholder.
NASDAQ:LULU
by ZachSap
VITE - a risky tradeAmong many other assets I've noticed VITE as it is in a very interesting position. Look at the trading volume during the past couple of months, either it is some sort of wash trading or a sign of accumulation. Also it is squeezed by the giant triangle so it will exit from it with a large impulse (theoretically) Anyways currently VITE is almost at the historical bottom so theoretically the only next stop below the current point is delisting. But I think a small percentage of the portfolio can be placed on that bet. If VITE falls below 0.01 - the trade is disposed of and we should exit by stop loss. I will get into this trade and see how it turns out.
VLong
by AlexLukyanin
TradeCityPro | EURAUD Analysis Buyers in Control👋 Welcome to TradeCityPro Channel! Let’s step outside the crypto space to analyze the EURAUD entry triggers for the coming week, examining both technical and fundamental aspects. 🌍 Fundamental Overview The EURAUD pair highlights the ongoing divergence between the Eurozone and Australian economic conditions. The ECB’s hawkish stance, supported by persistent inflation, strengthens the Euro, while the RBA’s dovish policies amid cooling inflation and a softening housing market weigh on the Australian Dollar. Additionally, Australia’s dependence on Chinese demand for commodities has created vulnerabilities due to China’s weaker-than-expected industrial growth. Geopolitical tensions, such as the Middle East conflicts, have supported the Euro, reinforcing its stability as a safe-haven currency. In contrast, Australia’s economic slowdown and labor market weakness are adding pressure on the AUD. The balance may shift as Europe's energy prices stabilize and China introduces economic stimulus measures. 🕒 4-Hour Time Frame On the 4-hour chart, buyer momentum is evident, particularly as the pair rebounded strongly from the 1.63584 support level after rejecting the 1.65469 resistance twice. This renewed bullish strength signals active buyers in the market. 📈 Long Position Trigger The 1.65469 level remains a strong trigger for a long position. Breaking above this resistance with volume could target the 1.684 zone, supported by RSI confirmation at 69.96. 📉 Short Position Trigger Despite the bullish momentum, a failed breakout or lower high near resistance could set up a short opportunity. A more reliable entry would be a breakdown of the 1.6358 support and trendline, targeting the 1.6016 level for a pullback. The pair’s trajectory will likely depend on macroeconomic developments and shifting risk sentiment in the week ahead. 📝 Final Thoughts This analysis reflects our opinions and is not financial advice. Share your thoughts in the comments, and don’t forget to share this analysis with your friends! ❤️
Long
by tradecitypro
6
EURUSD Trading Idea EUR/USD dipped 0.2% on Tuesday, marking its third straight decline as it approaches the key 1.0500 level. The Euro’s recent bullish momentum is fading, with traders shifting to a cautious stance ahead of two major events: US CPI Data (Wednesday): A pivotal release ahead of the Fed's final 2024 meeting. Inflation is expected to tick up to 2.7% YoY (from 2.6%), with core CPI holding steady at 3.3%. Any signs of stalled progress could dash hopes for a third consecutive rate cut on December 18, fueling USD volatility. ECB Rate Decision (Thursday): The ECB is widely anticipated to deliver another quarter-point rate cut. Forecasts suggest the Main Refinancing Operations Rate will be trimmed to 3.15% (from 3.4%), and the Deposit Facility Rate is expected to drop to 3.0% (from 3.25%). EUR/USD Technical Analysis: Entry Opportunity with SMC and Fibonacci Using Smart Money Concepts (SMC) and Fibonacci retracement, the key zone between the 0.71 and 0.79 Fibonacci levels is shaping up as a critical area of interest. Following the creation of a fair value gap at the last high, the price is now testing the 50% Fibonacci level, setting the stage for a potential trade setup. Trade Setup: Entry Point: 1.05520 (aligned with the 0.75 Fibonacci level) Stop Loss: 1.05697 (just above the 0.79 Fibonacci level for added risk protection) Take Profit: 1.04990 (targeting below the fair value gap for optimal risk-to-reward) Risk/Reward Insights: This setup offers a Risk/Reward Ratio of 2.98. By risking 17.7 pips to gain 53 pips, you're maximizing reward relative to risk. Disclaimer: Trading carries significant risks, and it’s essential to practice strict risk management. Always trade with a clear plan, use stop-loss orders, and never risk more than you can afford to lose. This analysis is not financial advice—ensure you understand the risks before making any decisions. Follow for more trading ideas, strategies, and insights to level up your trading game!
Short
by InwardTrader