Euro USD Candlestick example

Here is a chart for the EURUSD (Euro VS. US Dollars) market. Every candlestick represents 1 hour of trading, the blue signifies a bullish candlestick (up) and the red signifies a bearish (down) candlestick.

For this example, I will explain how you can earn from a BUYING POSITION

You saw an opportunity in a rising trend so you decided to BUY the EURUSD at 1.2569 since you expect to ride a rising trend that will go for hours or even days.

You placed an automatic cut-loss order at 1.2529 level incase that the market would go against your position as part of a wise trading strategy.

You also placed an automatic take-profit order at 1.2669 level incase you have to do something and cannot wait for your position to get filled in. You leave your computer assured that you have made a sound decision of BUYING in a rising market.

From time to time, you may also adjust your cut-loss order while the market is going in your favor, locking in profits. In this way, once you were able to set your cut-loss order at or above the opening price where you bought the EURUSD, you are already in a no-risk type of trade. Even if the market goes back, you will automatically get out of the market with profit. Hence, you may also adjust your take-profit order away from your opening price, depending on the market’s favorable movement and your trade plan.

This particular example would have already given you 100 points (or more) of profit against your calculated risk of only 40 points.

Profit/Loss per point depends on your account size and volume of lot being traded. It could be from 10c to $5 per point for mini accounts.