Understanding this relationship allows investors to better anticipate market movements based on broader economic trends. For example, high inflation rates might lead investors to seek alternative stores of value like Bitcoin, potentially driving up its price. Conversely, dovish central bank policies could lower inflation expectations and reduce demand for safe-haven assets like cryptocurrencies.
Account $10,000, risk 1% → $100 risk per trade. Entry $50, stop $48 → $2 risk/share → 50 shares. Target $54 (2R). If stopped, −$100; if target hits, +$200 (before costs).
Use an amount you can afford to lose while learning a repeatable process.
Decide a fixed risk % per trade, then divide by the price distance to your stop.
Match your timeframe: DAIly/weekly for swing; weekly/monthly for long-term.
Thesis, entry/exit, risk (R), emotions, result, next improvement.