📊 BEFORE ENTERING A CRYPTO TRADE, ASK YOURSELF THIS!
How much could you lose compared with how much you could realistically gain?
Many beginners think only about the profit. Experienced traders also consider the downside. 👇
🔹 1️⃣ Define Your Risk
Know where your trade idea becomes invalid before entering.
🔹 2️⃣ Identify a Realistic Target
Don't choose a target simply because you want a huge profit.
🔹 3️⃣ Check the Risk-to-Reward Ratio
If you risk $10 to potentially make $20, your planned ratio is 1:2.
🔹 4️⃣ Consider the Win Rate
A 1:2 ratio does not guarantee profitability. Fees, execution and losing streaks matter too.
🔹 5️⃣ Avoid Forced Trades
Even a seemingly attractive ratio is not enough if the setup is weak.
💡 Example: Risking $10 to target $20 means a losing trade costs $10 while a winning trade aims to gain $20, before fees and slippage.
A trading plan should consider both opportunity and risk.
👇 Which do you check first: the entry price or the risk-to-reward ratio?
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