News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Indices Update: As of 11:00, these are your best and worst performers based on the London trading schedule: US 500: 0.97% Wall Street: 0.49% FTSE 100: 0.44% Germany 30: 0.21% France 40: 0.06% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/utvdHDmep3
  • MACD who? The Moving Average Convergence Divergence (MACD) is a technical indicator which simply measures the relationship of exponential moving averages (EMA). Find out how you can incorporate MACD into your trading strategy here: https://t.co/ZNs4Qi8ieG https://t.co/OKfAFzmHhW
  • Do join me if you can by clicking on the link below in 10' time. As usual, I'll be looking at all the major charts, at the confidence indicators on the calendar and at the @IGcom client sentiment data https://t.co/zv4JEw9uDY
  • OECD GDP Estimates - Global Growth: 2021 5.6% (+1.4ppts), 2022 4% (+0.3ppts) - US: 2021 6.5% (+3.3ppts), 2022 4% (+0.5ppts) - China: 2021 7.8% (-0.2ppts), 2022 4.9% (Unch) - EU 2021 3.9% (+0.3ppts), 2022 3.8% (+0.5ppts) - UK: 2021 5.1% (+0.9ppts), 2022 4.7% (+0.6ppts)
  • 💶 GDP Growth Rate YoY 3rd Est (Q4) Actual: -4.9% Expected: -5% Previous: -4.3% https://www.dailyfx.com/economic-calendar#2021-03-09
  • 💶 GDP Growth Rate QoQ 3rd Est (Q4) Actual: -0.7% Expected: -0.6% Previous: 12.4% https://www.dailyfx.com/economic-calendar#2021-03-09
  • Heads Up:💶 GDP Growth Rate YoY 3rd Est (Q4) due at 10:00 GMT (15min) Expected: -5% Previous: -4.3% https://www.dailyfx.com/economic-calendar#2021-03-09
  • Heads Up:💶 GDP Growth Rate QoQ 3rd Est (Q4) due at 10:00 GMT (15min) Expected: -0.6% Previous: 12.4% https://www.dailyfx.com/economic-calendar#2021-03-09
  • 🇿🇦 GDP Growth Rate QoQ (Q4) Actual: 6.3% Expected: 5% Previous: 67.3% https://www.dailyfx.com/economic-calendar#2021-03-09
  • 🇿🇦 GDP Growth Rate YoY (Q4) Actual: -4.1% Expected: -4.6% Previous: -6.2% https://www.dailyfx.com/economic-calendar#2021-03-09
Stop Placement:  Negative Risk Reward Ratio

Stop Placement: Negative Risk Reward Ratio

Richard Krivo, Trading Instructor

Instructor's Response:

 
You definitely have the right idea on interpreting moving averages. As the faster Moving Averages cross the slower Moving Averages, a trade can be taken in the direction of the cross.
 
Regarding the trades you mention, however, I want to call attention to two things...
 
On the first trade you mention that the trade is short with an entry at 132.54 and a stop at 132.21. When selling a pair the stop would need to go above  the entry price as opposed to below it.
 
On the second trade the Risk Reward Ratio that is employed is negative...the risk is greater than the potential reward.  The risk on the trade would be 141 pips while the gain would be 99 pips. Over time negative risk reward ratios will not work in favor of the trader and we would not recommend them as they will slowly erode the size of your account.
 

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES