Hi, what you guys think is the best so call setting for tp n sl? The different inbetween the 2. Example tp 8pips and sl 10pipis??? Or tp 10 pips or sl 8pips??or even for both? Tp 8pips and sl 8pips too??? Don’t kn which is more better…
Imagine that you only won 50% of your trades:
10-pip SL & 8-pip TP = Losing Money
8-pip SL & 8-pip TP = Break Even
8-pip SL & 10-pip TP = Making Money
Now you tell me which one is best…
What we’re talking about here is risk reward ratios. So if you risk 10-pips to make 20, then that’s a 1:2 ratio. Now with that example, imagine still only winning 50% of your trades. After 6 trades, you’ll have lost 30-pips but made 60-pips so over all, you would be up 30-pips & you still only won half of your trades.
Risk reward ratios are VERY important!
Yes sir! I understand. The 3rd one is the best. But… i did encounter b4, i use 8 pips sl n 10 pips tp. And… it goes down till 12 pips than goes up again. Tat y i keep thinking which risk reward ratios is the most safest. If i use 10 pips sl n 12 pips tp. What if it dont hit up to 12 pips n goes down?? Sad…
The sooner you accept that you can’t win every trade, the better.
A good risk/reward ratio will make up for those trades that do go against you.
You could have a bigger stop than your TP but you need a far higher win percentage for such a system to be profitable in the long run.
Deciding what is the right SL TP is always difficult.
As baz1982 mentioned, first you have to look what you your winning rate.
Then try to get a better average number of pips on winners than on losers. A 2:1 Reward-to-Risk ratio is usually good enough.
However if you win 80% the trades and your loss is still twice as large as your average win, it would still work out.
Important is to do the math and have the right combination of winning rate and reward to risk ratio.
One more thought:
I am not here to give tips about strategy but a 10 pips take profit and 8 pips stop loss is hopefully only an example.
Because that is an agressive scalping strategy and for many pairs you pay 3-5 spreads which comes away from your 8 pips sl. So 8 pip sl - 5 pips spread is actually 3 pips sl. And having 3 pips sl and 10 pips take profit is a tough business to do.
Maybe higher time frames are easier to follow.
[QUOTE=“Zarterose;719641”]One more thought: I am not here to give tips about strategy but a 10 pips take profit and 8 pips stop loss is hopefully only an example. Because that is an agressive scalping strategy and for many pairs you pay 3-5 spreads which comes away from your 8 pips sl. So 8 pip sl - 5 pips spread is actually 3 pips sl. And having 3 pips sl and 10 pips take profit is a tough business to do. Maybe higher time frames are easier to follow.[/QUOTE]
+1 on that.
Going by your previous posts, I can only guess at your level & experience & I would suggest looking at higher timeframes. A 8-10 pip SL & TP can play out in minutes. If you’re seeing 100-pip daily ranges, surely you’d be wanting to catch more pips? You may need a bigger stop but if you get a good entry, stops don’t have to be as big as you’d think: I got 213-pips the other day with a 25-pip stop, it was a freak 250-pip range that day & it was heavily bearish so there’s an element of luck to the trade being that good but it is possible.
More data goes in to the formation of the candles on a higher timeframe so they are statistically more relevant than those TF’s below it. You should find it easier & less stressful to trade the 4hr or daily charts. Most traders with other responsibilities (ie, full-time jobs) opt for a higher TF. Even if you hope to scalp in the long term, trade the daily chart, then the 4hr, then the 1hr, then the 30mins & work your way down - fingers crossed you find somewhere along that line that suits you & your system/style.
After so much great information, Alanlim3 you must become a winning trader 
Thanks zarerose. (Please pardon me if my English sucks) 
Actually i still very green n new. I only been trading for real money for 1 yrs n b4 that been on demo for 6 month. So total is 1and half year trading. During the 1 year i hv already busted 3 account already. Im a Singaporean n also shy to say im just a taxi driver. Tat y i hv the time to do forex just like fulltimer while driving taxi at the same time. I looking a forex 12 to 15 hour every weekdays. Hahahaha. I hv try many time frame m1, m5, m15, m30, H1. Currently im using is m30. And m5 for confirm buying long or short. I keep researching on weekend to understand forex during market close cos no fish market on weekend, lol! I keep trying new strategy looking for new way to catch the candle fish in the market on weekdays. Haha im using 2 boilinger band currently with setting 20.1 and 20.2. 20.1 will b green n .2 will b red. So example when the green candle fish swim to the red line n over the red line near half of the body out, the nx one i will buy short n also comfirm by the macd. But… whenever i buy, sometime it red… but suddenly it reverse n turn green again…sad…n before using boilinger im using ema of 5.15.60 when 3 line cross together means will hv long breakout or breakdown. If only 5.15 cross together only normal up or down. But… this system only can confirm when 3rd candle appear. Cos it fully cross when 3rd candle appear. When 4th candle i buy. Sometime ot reverse also… again sad… so sometime i keep wondering… what really went wrong. …i keep searching n searching hope to find my sky one day. … pls guide me along dear all bro n sis.
I just insert a new photo combine of ems n boilinger band. To hv double comfirm with the help of macd. Cos it always reverse halfway. It gd to hv macd. Pls help to take a look hws this strategy. Pls guide mi.
I haven’t ever used billinger bands so I’m definitely the wrong person to ask for help with this strategy.
Personally, when I look at the small chart that you’ve address to me, I see that it starts with a consolidation that is a mix of small red & green candles. Then I see 3 green bull candles in a row which I would say was a bullish breakout (hard to say without seeing further left on the chart) so I would be looking for an opportunity to buy, not sell. Price retraces, finds support & we see another impulsive move upwards, it retraces again & finds support at the previous high (giving you a chance to buy inline with the move) & the surges higher.
Look how many green candles there are: from the breakout, there are 12 bull candles & only 4 red bear candles - therefore bulls are in control. The move is more likely to continue so going forward, I’d still be looking for options to buy.
I think that you should read about impulsive & corrective moves as well as read up on support & resistance.
Hi Alanlim,
I do not see any disadvantage for you being a taxi driver. You have the same chance to become a winning trader as you were a Professor at Harward.
But small steps are needed. Did you bust 3 live or 3 demo accounts?
I am very sceptical with using 1M and 5M charts. My experience says not to use those, even if you are a day trader.
We have to focus more on the process and not on the actual indicators in the beginning.
I bust 3 live account, demo n live seem abit different… demo seem easier to win pips…
Im now using m15 n m30 chart.