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Riskreward

USDJPY getting ready for a drop!Based on the chart, price for the third times reached a major resistance area and rejected. So based on these rejections, it seems to be a good trading area with low risk and high gain. Also the candlestick movements are getting weaker which can be a good sign for sellers. So based on this scenario I prefer to be seller at this area which can have good risk reward ratio. Note1: Selling on highs of the chart, can be a good trading way for this currency pairs for the following days. Note2: Please take risk management rules into consideration before opening any position on the market. Good Luck!
Short
by Brian_Philips
4
GBPUSD Good buy opportunity!Based on the chart, price reached a major support area and a strong rejection happened today. Still there is no sign of sellers at this area, and it would be highly possible this bullish movement continues to preferred area. So based on this scenario it would be a good choice to buy on dips which can provide good risk reward ratio for the following days. Note: As always please take risk management rules into consideration before opening any position on the market. Good Luck!
Long
by Brian_Philips
Risk management lessonI mentioned it on another day already, but this topic is very important so I decided to share it again to reach as much as possible. Hope it will help some! The last weeks it happend again, I saw some traders with less knowledge (young and old) who crashed their accounts very hard. They lost a lot of money and for some it was very dreadful! It is hard to watch this people how they burn money and bring even his own family in financial danger. That´s why I decided to share one important chapter from my book here to you. May be some will find very helpful, or some will remember this rules again. I will keep it a bit shorter here as in my book, but the main points are still mentioned! I can´t say it often enough, keep the important rules in trading. Trading is not the way to get rich quick, it is a serious and hard business! It take a lot of time to learn, it requires a lot of patience and it will happen a lot of failures. This failures are even more important than your success! Success will not open up how it will not work, failures will. Let´s talk about risk management! For each investment you have to consider you take for each trade the risk to lose money, that´s why it is mandatory to handle each investment with a good risk/reward distribution. You have to keep in mind, the determined risk/reward is only theoretically and can result complete different. But with knowledge you can dedicate a good entry for your trades to keep your risk as low as possible. Determine important support and resistance levels and think about all situations what could happen and what will you do if you are going into the red or into the green? Which levels are the best entry and exit? This all will help you to determine your riks/reward ratio. What is the Risk/Reward Ratio? Successful day traders are generally aware of both, the potential risk and potential reward before entering a trade. The goal of a day trader is to place trades where the potential reward outweighs the potential risk. These trades would be considered to have a good risk/reward ratio. A risk/reward ratio is simply the amount of money you plan to risk, compared to the amount of money you believe you can gain. For example, if you think a potential trade may result in either a $400 profit or $100 loss, the trade would have a risk/reward ratio of 1:4, making it a favorable setup. Contrarily, if you risk $100 to make $100, the trade has a risk/reward ratio of 1:1, giving you the same type of unfavorable odds that you can find in a casino. Which ratio should you desire? Like described above, finding trades with high risk/reward ratios (1:2 or higher), will help you maintain higher average profits and lower average losses, making your trading strategy more sustainable. The common suggestion between traders is a distribution of minimum 1:2 ratio. In reality there are often even better ratios available, if you do your technical chart analysis. But what should you do if you have to cut losses? We have to place our stop loss right below our support or other important levels we determined before. The purpose is to cut losses before they grow too large. Stopping out of a losing trade can be one of the hardest things for traders to do consistently. However, failing to take stops can result in margin calls, unnecessarily large losses, and ultimately account blowouts. How big should I enter a position? To lower your risk I recommend to think about your size to enter a position. Overall you shouldn´t risk money you need, only deposit money in your broker you can afford. Entering small can be the smartest way to safe your account. I suggest that because of four reasons, the first reason is, you don´t risk to much of your funds and your stop loss should be tight anyway. The second reason is, you can average down if the price is going in the other direction, but consider this option only if you are sure what you are doing. The third reason is, you can buy the dips/pullbacks if the trend is strong and still heading in your desired direction. In addition, the fourth reason is, your emotional control is stronger if the price movement is heading in the wrong direction. That brings me to another topic. Should you use leverage? Yes I know, big leverage will give you big gains...but as a beginner you will not have the experience to know which trade has a very big potential or not. Even experienced traders use only a small amount to enter a position and not the whole fund. If you use leverage the losses can be much higher and the problem with that is, if you lose money, your leverage will also decrease significantly and the losses are harder to recover after each loss. So the answer of the question, if you should use leverage: For beginners we can easily answer: Take your hands of a big leverage! You can so hardly blow up yourself with that tool, it is ridiculous. Your way back into the profit zone will probably take years. But you have to save yourself and after a period of time, a period of taking profits and cutting losses you will gain knowledge until you feel much more comfortable on the market and you understand how trading really works, then you can consider to use leverage. Conclusion: As I said, I want to share only some big points about this topic, because I think many new investors don´t understand how important that topic is! Safe yourself and have fun in trading and learning! Sincerely, TradeandGrow Trade safe!
NYSE:AMCEducation
by TradeandGrow
2
The bull case for wish I do not want to get into details about fundamentals etc we all saw wish quarterly results but with some much retail in this stock i was expecting a huge decline, the fact that retail investors all over the web are so pissed about wish and start panicking and exiting their positions is a + for me as i hold a long position. Now there are some interesting things i want to point out. There was a Wish pump on reddit based on the story that there is a 50% short float, which led to a 100% increase in price in 2days!!! at the same time Peter Thiel's founders fund start liquidating their positions together with galileo and temasek holdings which all were VC's that were with wish from the beginning. (www.nasdaq.com) Now why did these guys sold? 1. They already had a good return on investment since they were wish first investors 2. With so much publicity on wish stock and the pump to $15 they had they chance to sell so many shares instantly (insane demand from retail) 3. ***I am not sure about this one but a general rule of thumb on VC's is that they sell roughly 75% of their shares when a company does IPO. (makes sense because they need liquidity to look for other Startups) Now let's look at wish itself and where it could go from here. 1. We have rsi divergence on daily chart 2. Macd is higher than the previous drop 3. DMI is also in divergence 4. The company is worth right now $3.9b with $1.5b cash and $2.5-$3b in sales 5.They are losing users which is a very bad sign long term but even if they decide to close the business they could easily sell it for 2-3x sales meaning a market cap close to $8-10b 6. If they were to go bankrupt as many people say why did they hire new C level people , why did they spend so much money on logisticis and why did they get a banking license in Europe ? 7. I hear a lot the phrase "wish sells crap" well what most people that play the markets do not understand that wish customers are the majority of the population out there, what they do not understand is the fact that people are looking to buy cheap things from china because they do not have money to afford buying from amazon,etsy,shop etc... There are no wish buyers that trade stocks, this is the one thing you all have to understand! Wish buyers are people who used to buy on traditional brick & mortar, on illegal sales on the streets , on chinese stores etc.. These people have started to explore the web with Covid and still do not have much presence online as customers of amazon and others. 8. Wish #1 competitive advantage is that even people who never bought from it have heard about it. If they manage to improve delivery times and merchants quality they are about to address the largest % of the population out there. 9. Even if they do not manage to do that , even if they drop to $2b in sales , even if they are about to get out of business i cannot imagine that there is no one big player out there that is willing to buy them for a mediocre multiple of sales. 10. IF they execute right i believe this is easily a $100b+ company in the next 3-5years stop whining and either sell and admit you were wrong or hold tight and wait.
WLong
by Philoslother
4
Today I want to share some very important points in trading!The last weeks it happend again, I saw some traders with less knowledge (young and old) who crashed their accounts very hard. They lost a lot of money and for some it was very dreadful! It is hard to watch this people how they burn money and bring even his own family in financial danger. That´s why I decided to share one important chapter from my book here to you. May be some will find very helpful, or some will remember this rules again. I will keep it a bit shorter here as in my book, but the main points are still mentioned! I can´t say it often enough, keep the important rules in trading. Trading is not the way to get rich quick, it is a serious and hard business! It take a lot of time to learn, it requires a lot of patience and it will happen a lot of failures. This failures are even more important than your success! Success will not open up how it will not work, failures will. Let´s talk about risk management! For each investment you have to consider you take for each trade the risk to lose money, that´s why it is mandatory to handle each investment with a good risk/reward distribution. You have to keep in mind, the determined risk/reward is only theoretically and can result complete different. But with knowledge you can dedicate a good entry for your trades to keep your risk as low as possible. Determine important support and resistance levels and think about all situations what could happen and what will you do if you are going into the red or into the green? Which levels are the best entry and exit? This all will help you to determine your riks/reward ratio. What is the Risk/Reward Ratio? Successful day traders are generally aware of both, the potential risk and potential reward before entering a trade. The goal of a day trader is to place trades where the potential reward outweighs the potential risk. These trades would be considered to have a good risk/reward ratio. A risk/reward ratio is simply the amount of money you plan to risk, compared to the amount of money you believe you can gain. For example, if you think a potential trade may result in either a $400 profit or $100 loss, the trade would have a risk/reward ratio of 1:4, making it a favorable setup. Contrarily, if you risk $100 to make $100, the trade has a risk/reward ratio of 1:1, giving you the same type of unfavorable odds that you can find in a casino. Which ratio should you desire? Like described above, finding trades with high risk/reward ratios (1:2 or higher), will help you maintain higher average profits and lower average losses, making your trading strategy more sustainable. The common suggestion between traders is a distribution of minimum 1:2 ratio. In reality there are often even better ratios available, if you do your technical chart analysis. But what should you do if you have to cut losses? We have to place our stop loss right below our support or other important levels we determined before. The purpose is to cut losses before they grow too large. Stopping out of a losing trade can be one of the hardest things for traders to do consistently. However, failing to take stops can result in margin calls, unnecessarily large losses, and ultimately account blowouts. How big should I enter a position? To lower your risk I recommend to think about your size to enter a position. Overall you shouldn´t risk money you need, only deposit money in your broker you can afford. Entering small can be the smartest way to safe your account. I suggest that because of four reasons, the first reason is, you don´t risk to much of your funds and your stop loss should be tight anyway. The second reason is, you can average down if the price is going in the other direction, but consider this option only if you are sure what you are doing. The third reason is, you can buy the dips/pullbacks if the trend is strong and still heading in your desired direction. In addition, the fourth reason is, your emotional control is stronger if the price movement is heading in the wrong direction. That brings me to another topic. Should you use leverage? Yes I know, big leverage will give you big gains...but as a beginner you will not have the experience to know which trade has a very big potential or not. Even experienced traders use only a small amount to enter a position and not the whole fund. If you use leverage the losses can be much higher and the problem with that is, if you lose money, your leverage will also decrease significantly and the losses are harder to recover after each loss. So the answer of the question, if you should use leverage is: For beginners we can easily answer: Take your hands of a big leverage! You can so hardly blow up yourself with that tool, it is ridiculous. Your way back into the profit zone will probably take years. But you have to save yourself and after a period of time, a period of taking profits and cutting losses you will gain knowledge until you feel much more comfortable on the market and you understand how trading really works, then you can consider to use leverage. Conclusion: As I said, I want to share only some big points about this topic, because I think many new investors don´t understand how important that topic is! Safe yourself and have fun in trading and learning! Sincerely, TradeandGrow Trade safe!
NYSE:NIO
by TradeandGrow
8
AMD: Pullback + Low Volume = Dow Theory 5th Tenet.Hello traders and investors! Yes, AMD finally hit the 21 ema in the daily chart, which is something we were already expecting since our last study, but is it a good time to buy? We’ll see. This analysis is another real-life example of how to apply Dow Theory in our chart reading. Last week I said to you and I’ll just quote myself: “I would prefer to see it at the 21 ema , and there’s still a good chance that we’ll see this happening.” This analysis is public, and the link to it is below this post. But there’s something else, as it is not only the 21 ema which is holding the price, but the 50% Fibonacci’s Retracement too. Therefore, we are sitting at a very strong dual-support level, and now it is the best place for a bullish reversal pattern. The fact that AMD dropped with low volume confirms that the recent drop was just a correction. According to the 5th tenet of Dow Theory , the volume must increase when the movement favors the primary trend, and decreases when the price goes against it. Clearly, the primary trend on AMD is bullish, and drops are just corrections. Not only the odds favor the bulls, but the Risk/Reward ratio too. The price was above the $ 120 recently, and now it is a terrible time to sell. If I were shorting it, I would probably be buying it back right now at the dual-support level, as the chances of a reversal are high, and there’s not much more downside potential. In the 1h chart, we don’t have a clear bullish structure, but if AMD defeats the $ 106.17 it’ll bring something new , and might be the beginning of a bullish reversal. Personally, I’m not convinced that AMD will fly again so soon, and I would rather prefer to see more sideways movement for a while. However, I agree that now it is the best place for AMD to find its bottom and start doing bullish patterns again. If you liked this analysis, remember to follow me to keep in touch with my daily updates. Thank you very much!
NASDAQ:AMD
by Nathan_The_Finance_Hydra
2
BTCUSDT good sell opportunity!Based on the chart price have dropped two times and a support area have broken. This can be a good sign of increasing supply at this area and the weakness on buyers is observable at this area. Based on the change of polarity of support and resistance levels, the previous support now acts as a resistance area and a rejection is about to happeining. So based on this scenario I prefer to be seller at this area and it can provide a good risk reward for bearish traders at this zone. Note: First I have to say I'm not a Crypto trader (I work as a Forex trader) but just saw this opportunity and want it to share with other traders at this field. Please take all risk management rules into consideration before opening any position on the market! Good luck!
Short
by Brian_Philips
2
PLTR: Complete Multiple Time Frame Analysis after Earnings!Hello traders and investors! Today PLTR reported its earnings, and the volatility increased, as expected. There are some key points we can use, and we’ll talk about them in this complete Multi Time Frame Analysis (MTFA) . First, now it is too late to buy. The time to buy was during the Ignition Bar evidenced in the 1h chart, which was a classic bullish candlestick pattern, just above the support at the purple trendline. What’s more, PLTR just filled the first Breakaway Gap , which was my first target since the analysis I did on July 20, “PLTR: A very Technical Bullish Thesis”, which is public, and the link to it is below this post. If you buy now, it feels like you’ll buy from someone who bought at the Ignition Bar down there, and will use you to book profits. Always try to buy from who’s panicking, not with the herd. If I were out, I would wait for the Risk/Reward ratio to make sense again, probably after a correction, near a support level. This wouldn’t change the bullish bias seen on PLTR, as I still believe we’ll seek the next gap at $ 26.32. The daily chart reinforces the bullish thesis: The daily chart suggests that we can seek the $ 27.47. We just defeated the 38.2% Fibonacci’s Retracement , which worked as a resistance at least 2 times (Jul 12 and Aug 10). We also defeated the 21 ema, and the situation is clearly bullish. It would be good if it corrects again, but we can’t count on that. It is interesting to notice that PLTR has been doing many good and technical movements. The bottom seen last month was just a pullback to the 61.8% Fibonacci’s Retracement, and it did a perfect Piercing Line candlestick pattern on Jul 19. However, I have one more key point for you, and this time it is in the weekly chart: Although the $ 27.47 is the target in the daily chart, this is a bullish pivot point in the weekly chart . If triggered, PLTR has a good chance of retesting its All-Time High again. To sum up, if you aim for the short-term, you have an opportunity to book profits now, as we just hit the first target in the 1h chart. If you aim for the mid-term, the $ 27.47 is the target for you. In a longer-term perspective, if PLTR triggers the pivot point in the weekly chart, the $ 45 is where you should aim. In addition, if you still don’t follow me, I invite you to do so ! I write daily analysis here on Tradingview, and I’m sure you’ll find something interesting around. Take care, my friends!
P
by Nathan_The_Finance_Hydra
6