๐ Risk-Reward Ratio: The Key to Smart Trading! ๐ก
Successful traders never guessโthey calculate! The Risk-Reward Ratio (RRR) helps you weigh potential profits against possible losses before entering a trade. ๐
How to Calculate RRR:
๐น (Target Price โ Entry Price) / (Entry Price โ Stop-Loss Price) = Risk-Reward Ratio
Example:
Entry: BTC at $75,000
Stop-Loss: $72,000 (-$3,000 risk)
Target: $81,000 (+$6,000 reward)
RRR: 6,000 / 3,000 = 2:1 โ Good trade!
Why It Matters:
โ Helps you filter low-quality trades โ
โ Ensures long-term profitability ๐
โ Keeps emotions out of trading ๐ค
๐ก Pro Tip: Use indicators like Fibonacci retracements, RSI, and moving averages to refine your targets!
How has RRR improved your trading decisions? Drop your insights below! ๐๐๐
