You need to know your risk-to-reward ratio before Fibo Quantum Scalper Review you enter a trade. Many beginner traders when they spot a good entry signal in the market and quickly rush to enter into a trade. This can be very risky and dangerous without having a good trading plan; it is also a poor risk to reward ratio in forex trading.
You may enter into a position with a good entry signal, but if your profit target is 10 pips while your stop loss is 20 pips means that you will be trading with an unnecessary higher risk simply because your risk to reward ratio is 2:1. This is hardly a good deal because you're risking 20 pips to gain 10 pips. Would you place a 20 dollar bet in exchange for a 10 dollar reward? Many traders are doing it every day in the trade.
As a rule of thumb, make sure that all your trades have a risk to reward of at least 1:1. If you happen to see a good entry signal but the risk-to-reward is poor do not take the trade, let it go. There will be plenty of better opportunities in the market every time. It is also important to have a trade plan before you enter into a trade. Be disciplined, control and manage your risk to reward ratio in forex trading so that your trading account will show you the rewards of your hard work!