![]() So, it is vital that you only enter positions based upon a positive risk-reward ratio. When it comes to choosing your take-profit level it is important to take into consideration the risk-reward ratio you want to implement. With the EMA crossover strategy, it is best to place your stop-loss above or below the most recent swing in price (I have outlined a potential stop-loss level in the picture below). Now, a key part of trading and having a solid strategy is understanding risk management and where to place stop-loss levels. Where To Place Stop-Losses and Take-Profits Where To Place Your Stop-loss Right, now you’ve mastered that part, let’s move onto a vital part of trading strategies, risk management, or in this case, where to place stop-loss and take-profit levels. Wait for the 20 EMA to cross below the 50 EMA.I’m sure you have worked out that sell signals occur when the exact opposite happens, but just for clarity, to enter a sell position you will need: So, once you have confirmed the trend, you will need to watch and wait for the 20EMA to close above the 50 EMA, and then you can enter a buy position. ![]()
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