When it comes to risk management, there are two reasons:
First of all, if you are an inexperienced trader, you can easily take profits without thinking hard.
Second, even if you are a professional trader, once you have a certain profit-taking threshold, you can always reevaluate how price interacts with this threshold and decide whether to take profit or not. to partially close the order or let the trade run itself.


When trading in the market, it is imperative that you equip yourself with a stop. In other words, you should decide in advance the level to stop-loss if the price is not performing as expected. That is probably the single most important element of successful trading because to cover losses you have to put in a double effort. Don't risk more than 2% of your starting capital per trade.

"Cut the loss quickly and let the profits ride"


Price movements are cyclical, repeating. There may be differences, but in the end, it is a human emotion that causes the price to form, and human nature never changes. While the price may move roughly the same as it did before, it's not exactly the same. If something goes wrong with the currency pair (or commodity) trading at the moment, you should leave the position immediately. It doesn't matter if you are in a losing stance or a little win. As noted, even if it is a winning trade, do not keep it, but accept "break up early, reduce suffering". This way, you will have more time to effectively analyze the trading environment and find a better place to put your money.


Price action is very important in trading on evidence, not expectations. A lot of new traders are expecting a certain price movement before it completes its action. They act on hunch instincts and in the end, they lose money. The most important thing about a trading setup is its complete form. Don't buy on expectations. If a price pattern is incomplete, do not initiate the trading.


If a trade goes according to plan, helps you achieve your profit target and the price continues to show me the main trend is still in your favor, you won't "bye" the trade, but rather to stick with it - as long as it is still working. That's where profits are made and the rest of the game is capital management, but rather proper capital management.


Another important factor when trading is the ability to sit down and wait. You should be willing to wait a long time before meeting a suitable trading setup. You need to accumulate as many beneficial factors as possible. You should never rush in to buy or sell. Stay calm, even if you've missed one setup and wait for the next one to appear. Don't overtrading, because climbing high will hurt, her grandparents have taught.


As a rule of thumb, a good R: R ratio is usually 1: 2 or 1: 3. A 1: 3 ratio may be enough to make a good profit, but if you stick to winning trades, you can even make 1:15, 1:20, or more. That is what professional traders have been pursuing.

Even with a moderate (if not small) winrate, an R: R ratio of 1:15 will still put all the odds in your favor and you will realize how important that is in trading.

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