How do you determine potential profit? For risk:reward ratio

[SystemTrader]

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

Would it be at a previous resistance?

What if it's a new high and there is no previous resistance, would it then be at certain price points?

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[Sterbens]

the mistake is when you enter without looking at the resistance barrier first. open position carelessly. You only need to hold it and even then it doesn't necessarily have a profit, because the first rule, don't enter when you see the potential above the highest price. do simple analysis with a method you understand.

[Jaycee99]

the mistake is when you enter without looking at the resistance barrier first. open position carelessly. You only need to hold it and even then it doesn't necessarily have a profit, because the first rule, don't enter when you see the potential above the highest price. do simple analysis with a method you understand.

Correct but I would suggest doing one of my answers and suggestions that I am gonna write.


 

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

From the simple statement "invest low and sell it high". Sorry if it's not the right and exact statement but you got the meaning of my statement? And to determine when it is the right time while the charts stay on red is simple you really need to gain knowledge when it comes to trading and handling stocks( it may be different from bitcoin but I did read a few), likely more on handling trading about bitcoin if you want to learn asap.

Plus read different articles or in every forum here that you are curious about and if your question has not yet been asked here go and create a thread and ask.

Would it be at a previous resistance?

The price point is base on you and your knowledge as well as experience and depends on your money and if you will especially go to day-to-day trading.

Likely from my point of view, the answer to that will be in different forms of numbers.

Still lets me give you an example the amount of bitcoin is at 60K and later for a few days it went on 50k or 40k I would say go and buy.

 Still, in determining the amount, you will earn is you need to do the math and in the end, it depends on what you already know and gain. I know I should be straightforward on what should we know exactly to determine the resistance but like I said it really much better for you to learn about trading by yourself.

What if it's a new high and there is no previous resistance, would it then be at certain price points?

I am kinda confused no new resistance? Which will stay on that highest price value? For a long time? First, it can't be possible without a previous resistance


 (Answering this base on what I understand)  are you saying that if there is a new highest resistance and it could stay for a while on that price or changes is only at 2 or 3 percent lowest? I would suggest you must wait for that right moment.

[Sinjokubhi]

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

Would it be at a previous resistance?

What if it's a new high and there is no previous resistance, would it then be at certain price points?

Accuracy in determining profits, not many of me can help you, hopefully my explanation can help you.

1. Make sure you have a Trading System
Not having a Trading System is like getting into the battlefield without weapons (ammunition). There is more chance of losing than winning. The Trading System is what will be your guide in determining when to enter and exit the market.

2. Only open positions if the trend is supportive
Trend is your friend. Ride the trend. Follow the trend. These words suggest that it is not advisable to trade against the trend. If swimming, of course it is easier to swim if we go with the current, rather than against the current, right? Bear this in mind: "Trend must be my friend" before I make a trade.

3. Ensure risk trading matches our risk profile
To become successful traders, we not only have to make a profit, but also have to be able to survive the losses that we might encounter. If you do not pay attention to this, the capital can be significantly reduced and there may even be a call for "love" from a borker, aka a margin call. There are times when the market is very volatile. These conditions are not suitable for certain trading systems, so sometimes it is better to avoid market conditions like these.

4. Make sure the Risk - Reward Ratio is large enough
The Risk Reward Ratio must be large enough, at least 2 to 3 times. This means that if we are ready to cut a loss of $ 10, the minimum potential profit that can be obtained can be $ 20 to $ 30. If the Risk Reward Ratio is too small, it's better not to trade. It will just make you work a lot more than usual.

[SquallLeonhart]

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

Would it be at a previous resistance?

What if it's a new high and there is no previous resistance, would it then be at certain price points?

I'm following multiple technical things here to determine where to book profits as per my prediction and where to exit if market goes against my prediction. All the technical analysis are not dealing with support and resistance levels but there are other multiple methods are available like crossover or closing above closing below are the indications to exit/book profits.

But having your own method for entering and exiting will be helpful. Most people will be having all these but at the time of market pressure, they will just delay due to greedy or fear of loss.

[LUCKMCFLY]

This depends on the type of trading you want to do, to enter the market it is always good to have the appropriate plan according to your vision of the market, generally when trading in the medium and long term it is better to establish a system of losses less than 10% of the balance allocated in tading.

For some, they take into account in trading the hope when the market goes against, that is, if they establish a stop loss of more than 10% they let it run thinking that it can recover, in general it does not happen, the resistances that are established for the Stop Loss usually fail because the whales also know them, for them it is easy to reach the lowest point of resistance and then raise the price, so to establish the Take Profit it is better to give it above 10% and not lower it.

[tbterryboy]

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

Would it be at a previous resistance?

What if it's a new high and there is no previous resistance, would it then be at certain price points?

You sound too technical. When you're looking into market fluctuations then definitely you will get an idea on how to determine potential profits. I have seen that most people are on the spot finalizing their profit level because they are not sure about how wildly market will be fluctuating so based on the situations they are booking profits or they are keep delaying with the trailing stop-loss.

[Gozie51]

You only need to hold it and even then it doesn't necessarily have a profit, because the first rule, don't enter when you see the potential above the highest price.

Yeah not entering the market at high price won't be profitable but the challenge is that it is difficult to determine when is high and when to drop. Despite analysis made, it can't be perfect or accurate, so we need to pattern our risk appetite.

[Yamifoud]

I'd never make myself too complicated to know if I'm going to have a profit or not.
I'm simply put my money to known and potential coins, that's it. But to determine how much possible you were able to gain? There is no answer to that but considering that we are investing in these coins like Bitcoin and ETH, you'll going to expect such returns. But that also matters on how much you invested and how you manage your investment as that will be the basis of your gains depending on the result.

[Willitivity]

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

Would it be at a previous resistance?

What if it's a new high and there is no previous resistance, would it then be at certain price points?

If you have the fibonacci extension tool, you can use it to determine certain sell or take profit zones then all you have to do is simply place orders art those price levels. Usually, when there's an all time high, there's no sure fire way to know these levels but tools like the fibonacci extensions can help you with some possible selling zones. But I would advise you to start taking some profits whenever price crosses a resistance and creates a new all time high. You can start selling some percentages as the price continues on the upward parts.

[tygeade]

When you're looking into market fluctuations then definitely you will get an idea on how to determine potential profits. I have seen that most people are on the spot finalizing their profit level because they are not sure about how wildly market will be fluctuating so based on the situations they are booking profits or they are keep delaying with the trailing stop-loss.

Making use of trailing stoploss will be a good idea when you are not having technically supported price levels to exit. At the same time, I will never recommend to go for finalizing your entry or exit level by just looking into market fluctuations with bare eyes. Definitely you will get tricked by market volatility.

Your every action in trading must be based on your strategies and tactics. For this, you do not need to be good in technical analysis but everything should be planned well in advance so that you will able to make use of your experience because when you're taking decision at market condition that will be influenced by your emotions and not by your knowledge and experience.

[Maus0728]

Perhaps, this could help you! But I highly suggest you to watch the whole series so that you can understand what levels, support zone or any other jargons he said in the video. They are currently being uploaded in youtube every week for free!!

Managing Your Stock Account || Blueprint L13: BANKROLL MANAGEMENT 1 (Procedural Analysis)
Managing Your Stock Account || Blueprint L14: BANKROLL MANAGEMENT 2 (Procedural Analysis)

[Ryker1]

I get that generally your risk amount should be at a previous support and within the amount you're willing to risk but how exactly do you determine potential profits?

Would it be at a previous resistance?

What if it's a new high and there is no previous resistance, would it then be at certain price points?

Well, it is just sad that the buy low sells high approach is way too hard to identify. You will never know if the price you have today is actually the low part of the market. Sometimes, it is at its lowest but still considered as high and that is why it really is hard to analyze it. What I would suggest is that you may try to get in with the amount that you have and stick with the price you have today. The only rule for you to win this is to avoid pulling out the funds. Not until you see the profit already. If in case that the market went down, the golden rule is to keep the asset on your portfolio and never sell it until you see a profit. That basically it.

[hugeblack]

It depends on the nature of investment. Buying at the resistance areas means that you may buy the currency at the lowest possible price, especially if the currency fails to break that barrier.
As for selling, some prefer if the currency reaches the level of support and fails to break, it is better to sell at the purchase price and leave the profits. You will not be afraid of fluctuating profits because you bought it for free.