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Two separate things. Start with the walkthrough to learn the screen you trade on; the topics explain the trading behind it.
Two separate things. Start with the walkthrough to learn the screen you trade on; the topics explain the trading behind it.
Candle Arena needs the height to show a chart and your trade at the same time. Landscape on a phone is not supported yet.
A stop sells automatically if price falls to it. Say you have $10,000 and will lose at most $100 there. At 0.40 a share, that is 250 shares.
$100 ÷ 0.40 = 250 shares
If the stop is hit, 250 shares each lose 0.40, so $100. Traders call that amount 1R. A loss at the stop is −1R.
250 × 0.40 = $100 · −$100 ÷ $100 = −1R
A target is the price where you plan to sell a winner. Here it is 38.94, 1.00 above the buy. The stop is 0.40 below. That is 2.5 to 1.
Reward 1.00 ÷ risk 0.40 = 2.5 to 1
Suppose you sold at 38.34 rather than wait. Each share made 0.40, so +$100, which is +1R. R counts where you actually sold, not the plan.
250 × 0.40 = +$100 · +$100 ÷ $100 = +1R
Price reached 38.97, so the sell at 38.94 filled. 250 shares each made 1.00: +$250. Divided by 1R of $100, that is +2.5R.
250 × 1.00 = +$250 · +$250 ÷ $100 = +2.5R
A trader whose 1R is $50 wins $125: +2.5R. One whose 1R is $500 wins $1,250: also +2.5R. R works the same on 1-minute, daily or monthly charts.
$125 ÷ $50 = +2.5R · $1,250 ÷ $500 = +2.5R
One trade could lose $400 and wins $200: +0.5R. Another could lose $50 and wins $100: +2R. The $100 win was the better trade.
$200 ÷ $400 = +0.5R · $100 ÷ $50 = +2R
Far targets fill less often than near ones. So a 5R plan is not twice as good as 2.5R. What counts is your average in R over many trades.
Two trades both win. One makes $300 where 1R was $600. The other makes $150 where 1R was $50. Which did better?