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Riskreward

Entry Strategies using Support & Resistance ZonesBrief video tutorial discussing entry strategies using support and resistance zones. How I produce support & Resistance zones can be learnt from the live stream recording HERE With any trading indicator, it is vitally important to have a sensible entry strategy with entry, stop loss and enough risk to reward to the next support or resistance zone. It is also as important not to fudge your entry and stop to give a decent risk to reward. Frame your charts first with Support & resistance zone, put on your stop and your entry. Then the last thing to do is put on your risk to reward. I cover this in this video and show you how to use the Fibonacci extension tool to work out your risk to reward
CME_MINI:RTY1!Education
by PBratbyOfficial
Nat Gas - Classic patterns vs Elliott WaveWe can make the case for this being a rising Wedge Pattern or in terms of the Wave Principle, an Ending Diagonal fifth wave. Looking at the Wedge pattern, there's nothing wrong here and we can short if price goes outside the pattern. But there are two problems with this view according to the wave Principle : 1) Wave 4 did not enter wave 1 territory altough this can happen on rare occasions. 2) Proportions wise, wave 3 is bigger than wave 1 which is possible in case we have an Expanding Diagonal but because wave 4 is smaller than wave 2 here, I don't think that's the case. This then leaves us with the Extended fifth wave possibility I talked about on the last update. We can therefore expect something similar to this or possibly even much higher prices than 4.00 if it really starts to get extended.
NLong
by ElliottWaveBelgium
Here's How I Doubled My Money on Silvergate Capital Corp ($SI)I sold half of my position on a double of $SI yesterday. I'm now in a risk-free position for life. I bet only a small size, but I think small is the way to go for longevity in this game. I took this trade for two reasons: Fundamentals & Technicals. I'll break down both. The Six Most Important Fundamentals Firstly, the six most important fundamentals looked good. You can take a look at the fundamentals, here . The fundamentals are broken down into six categories Value Dilution Cash Debt Growth Effectiveness Here are some metrics for $SI: Value P/B: 1 P/E < 20 Dilution < 25 million shares out Cash P/C < 5 P/FCF < 5 Debt D/E: 7 Long-term D/E: 0 Growth Quarterly Revenue Growth > 5% Quarterly Earnings Growth > 20% Effectivness Return on Assets > 0% Return on Equity > 0% Return on Capital Employed > 0% These six fundamental criteria cover virtually all aspects of a stock's fundamentals, and it's the best way to get a clean, holistic view of a business. These six fundamental criteria all kinds of stocks, whether they are high-growth, value-based, dividend-paying, small-cap, etc Sometimes, businesses may have high debt (like this one). However, if they have good cash-flow, that, in some ways, balances the high debt. Why? Good cash-flows will be used to pay off the debt. On Risk And Relax , you can choose the fundamental factors that you think are the most important, and ignore the rest. This way, you can cleanly analyze a business without the noise. In this case, $SI had a good score of over 65% when considering all six fundamental criteria. Now, let's look at the technicals. The Most Important Technicals There are several technical indicators, but in my opinion, the most important "indicator" is market structure. In other words, is the price shows signs of a bottom? I want to see the price in the shape of a 'W'. And around April of this year, that's exactly what I saw. The Bottom Line All other technical indicators are fine, but they add noise. The goal should always be to subtract noise. And the best way to do this is to focus solely on price action (market structure) and the six key fundamentals. If both are a go, then I feel comfortable buying! So, that's what I did. I bought @ $9, and I sold half of my position when the price hit $18. I had the conviction to keep holding because of the fundamentals. I hope this helped. I also made a YouTube video on this investment. Check it out!
S
by realcapmillen
NZDUSD - Follow up to previous post This is a follow up to my previous post and is here simply to show the effectiveness of the Elliott Wave Principle and one way to apply it. We shorted this ending diagonal right after closing our longs because for 2 reasons : 1) We got an Ending Diagonal wave 5 which should be followed by a sharp reversal. 2) We got could count 5 waves up, and the wave principle tells us that a reversal should then follow. Here's how we played this with my subscribers: 14 Oct 18:13 :I'm shorting this one. 20pip risk is nothing 16 Oct 01:23 : Our short was a great idea and played out perfectly here. I'm going to close and take 2/3 of my profits and move stop to 6652 for the rest. 20 Oct 01:52 : I prepared the chart yesterday but didn't find the time to look it up today and sadly missed a nice opportunity to re-enter again on those one... Sorry 🙏 Let's now see if it can go outside this rising channel and below 6576 at which point we maybe can get a new shorting possibility. 20 Oct 17:09 : Testing lower channel line. If it stays sideways here, we could get a new short entry possibility.
by ElliottWaveBelgium
NZDCAD - Good R/R Set up - TRADE OPPORTUNITY Technical view of - NZDCAD - Whilst having fun doing my weekend analysis for the week ahead, I do this to plan my week ahead - I'd like to share a good trade opportunity for you for next week! Pattern - Head and shoulders / Bear Flag - Measuring the patterns both = to good Support areas. - If it goes above the areas of where the shoulder should be - the pattern of H&S is no longer validated - I would then concentrate more on the Bear flag formation building, for further confirmation you could wait for the break out and trade the pull back or get in where you think is appropriate following your trade plan. Within my analysis - I have clarified where I'd be taking profit - Profit 1 & 2, I tend to scale out of trading taking profits due to psychological reason, which there are great books out there and mentors to help you with this - if you're interested within learning more about this - message privately. Again, follow what your plan - I will be only taking 60-70% of my profits at profit 1 area (Depending on price action at that moment of time) and the rest at profit area 2. (You could even go through lower time frames for day trading set up opportunities - Higher time frame = Shorter time frame movement). Key tips: All alerts and don't forget to put an appropriate STOP. It's good R/R trade. Remember: Just a trade idea, not a recommendation. Have a great week ahead! All the best, Trade Journal
by Trade_Journal
S&P500 - New high comingAlthough we have the risk of this being a 3 waves rise, by the looks of it I tihnk we'll see a new high as this move has the caracteristics of a corrective wave 4. Looking at the number of stocks that keep on breaking out of corrective bases and making new highs (look at my profile) but also looking at the Advance/Decline Line we can see that we have positive divergence with ADL making new high while the indexes are still below their previous high, this gives me confidence in my outlook that the move higher will continue.
FOREXCOM:SPX500Long
by ElliottWaveBelgium
1
Trade Like a Pirate: Ye needs the aRRR!!!!One of the amazing things about trading the financial markets is that it is the only industry where we “common folk” have the potential to EXPONENTIALLY grow our income day after day, week after week, year after year. All our lives, from opening up our first lemonade stand to landing our first job, we are taught to make LINEAR income: to exchange TIME for MONEY. We are told that we must work “X” amount of hours per day, and you can earn “Y” amount of money. If you want more money, you simply have to work longer and harder: work overtime, work a second job, or start a "side hustle", and though it is true you can increase your earning power through multiple income streams or by climbing the corporate ladder, you are always going to be limited to the amount of money you can make because there are only so many hours in a day that you can work. As Al Pacino said in Scarface, "Say hello to my little friend…” May I introduce to you, “R”, which stands for “Return”. There are two powerful paradigms that you, Dear Trader, have access to in our glorious financial markets, and our primary goal needs to be that we MAXIMIZE all we can from them. Paradigm Number One is a popular reason that we enter the fray: Instead of "working for our money” we trade so that we can "make our money work for us." Instead of clocking into a job where are are assigned duties where we will earn our daily bread, we take our “bread" and we assign it to a company, a commodity, or a currency in the stock, options, futures, and forex markets. We aim to hit “X” dollars per day or “Y” PIPs per day and call ourselves successful traders. Paradigm Number Two is where the magic is, and is the topic of this article: let's “kick it up a notch” as Emeril likes to say. Instead of trying to earn "so many dollars per day," let us instead set our sights on achieving a certain “R” per day. “R" is a measure of *return* based upon the amount of ‘risk’ we are willing to take on any trade. A good rule of thumb is that with any trade, you should never risk more than 1% of your account equity and you should never get into a trade without at *least* a 3-to-1 expectation of Reward if you are correct. This is known as the "reward-to-risk ratio”, or “R”. The working principle behind this is that we want to keep our risk *small* (i.e. you won’t blow up your account with a bad trade) and our reward *large*, where your winning trades will give you a minimum of three times what you are risking. In this scenario of 3:1 you don’t have to be the best of traders to be a profitable trader. Say you do 3 trades per day and you were a mediocre trader, where you are only batting one out of three. You can only have a 33% hit rate, only winning one of every 3 trades, and if that were the case you would win 3%, lose 1%, and lose 1%, netting 1 “R" for the day. (3-1-1 = 1) "1R? What good is that?" you might ask? Well here’s where we start talking about the *miracle* of compounding. On Day 1 with a $10,000 account you would look at risking $100 per trade to win $300. If you lost 2 and won 1, your account now has a value of $10,100. So on day 2 you aren’t risking $100, but $101. Every day you place 3 trades and win at least 1, your account grows not linearly, but *exponentially*. Each week you are making more and more money EVEN THOUGH YOU ARE DOING THE SAME AMOUNT OF WORK. By week 34 you are risking $500 to make $1,500. At the end of the year, (theoretically of course) that $10,000 could be worth over $120,000 - Your account has now grown in an order of *magnitude* from where you started. And all you are doing is placing 3 trades per day. Day in. Day out. Do it again for year 2 and see what you come up with! Every day you are doing the same amount of work, but every day you are generating an increasing amount of cashflow as the 1% you are risking grows each and every day. What does it take to get these kind of results? First, it takes a system of trading that you can follow that can give you at least a 1-in-3 success rate. Second, (and this is the hard part...) it’s all about YOU. Every day you don’t trade is anther day your net worth doesn’t grow… another day you will have to WAIT to achieve your dreams, whatever reason it was that you decided to become a trader. But once you start realizing the power of R you will NEVER want to trade time for money again: you will want to increase your net worth by 1R, 2R, 5R per day until you reach that Magic Number you need to say “I’m done… I’ve got all the money I need to live as long as I need to enjoy the lifestyle I desire.” TradingView makes it super-simple to put this philosophy into practice. Using the Long & Short Position tool, you can map out your trade, right-click the tool, select “Create Limit Order” and then change the “% Risk” field to 1%, 0.25%, or whatever your trading plan requires. (My personal “R” is one quarter of one percent, .025). For stock trading, the tool then automatically fills in the number of shares that will satisfy your risk percentage. For futures, it automatically calculates the number of contracts, and for Forex (most brilliantly!) it will automagically perform the necessary currency conversion and calculate the number of Units you can trade. THIS FEATURE ALONE is why I became a Premium subscriber to TradingView to trade through my Forex and Futures brokers - no more position sizer spreadsheets! If you are not using the Long and Short position tool to place your orders you are missing out on a great resource. I will leave a link to a TradingView blog post on how to use it below. A great exercise to get you excited about trading like a pirate is to create your own trading spreadsheet and calculate like a Pirate: Calculate your “aRRRRRRR” in multiple scenarios. There are 250 trading days per year give or take. What if you grew by 1R per day and you traded every day? What if you grew by 3R per day but you only traded 2 days per week? What if you were an options trader and you only traded on Mondays but you gained 7R per week? What if you threw in a home-run 20R trade every 3 weeks? (Yes, they do happen!) What’s your end retirement goal? $2 million? $7 million? When can you calculate that you will get there? By estimating your exponential growth you will be able to estimate the you will reach your life target. Although these scenarios are idealized (we’re not *always* going to have a “Green Candle Day”) we need to have a PLAN for our trading activity. Having a *plan* and matching that with a *vision* will give you a *passion* to DO what you need to do so you will GET what you want to get. As Louis Carrol said, “If you don’t know where you are going, any road will get you there.” And as Norman Vincent Peale said, "Shoot for the moon. Even if you miss, you'll land among the stars.” Make you plan, and work your plan. And having an exciting Vision will help you wake up early, stay up late, and stay on track. I hope this lesson helps you bring out your inner pirate… I’ll see you on the high seas of the financial markets! Trade Hard, and trade well… Till next time… -Anthony www.tradingview.com
Education
by ocaptain
54