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Normal Forex & Crypto Trading · Chapter 4

Risk & Trade Execution

Master stop-loss, take-profit, leverage, position sizing, and trade direction to protect your capital and execute with discipline.

⏱ 60–90 minutes 📚 Hands-on practice 📖 Lesson 04 of 6
Important Reminder Forex and crypto trading are high risk and speculative. Everything on this website is for education only and not financial advice. Never trade with money you cannot afford to lose. Always start with a demo or paper trading account. For real investment decisions, consult licensed financial professionals in the Philippines.

What you’ll be able to do after this lesson

  • Place stop-loss (SL) and take-profit (TP) orders logically using structure-based, volatility-based (ATR), or fixed-distance methods.
  • Calculate position size correctly (lot size for Forex, quantity for crypto) using a step-by-step formula.
  • Understand leverage, margin, and liquidation—why small moves can wipe an account.
  • Go long or short with a plan (when, why, and how long to stay in a trade).
  • Follow PH safety and compliance basics (BSP VASP rules; SEC advisories).

Introduction

This is where trading gets real. You’ll learn to set stop-loss and take-profit like a seatbelt—always on before you drive. We’ll walk through position sizing so you risk a fixed percentage, not random amounts. You’ll see how leverage works (and how it can hurt). By the end, you’ll have a clear process for entering, managing, and exiting trades safely.

Key formulas (quick reference)

  • Forex position size: Account Risk ÷ (Stop Pips × Pip Value)
  • Crypto quantity: Account Risk ÷ % Stop
  • Lot sizes: Standard (100k), Mini (10k), Micro (1k)
Non-negotiable rule Never move your stop-loss farther away after entry. If the trade is wrong, you exit and reassess.

Lesson roadmap

Section 1 — Stop-Loss & Take-Profit: Your Seatbelt

SL/TP
  • Three SL styles: structure-based, volatility-based (ATR), fixed distance
  • TP styles: fixed R:R (1:1.5 to 1:3), structure targets, partial exits + trail
  • Rule: Never move SL farther after entry

Section 2 — Position Sizing & Lot Size (Forex + Crypto)

Sizing
  • Forex lot sizes: standard, mini, micro
  • Pip & pip value (4-decimal vs JPY pairs)
  • Position-size formula (risk-first, not “feelings”)
  • Crypto quantity formula using % stop

Section 3 — Leverage, Margin & Liquidation

Leverage
  • Initial vs maintenance margin
  • Margin calls and forced liquidation
  • Why higher leverage narrows liquidation distance

Section 4 — Long vs Short & Time-in-Trade

Direction
  • Go long when trend/structure supports higher prices
  • Go short when downtrend/weakness is confirmed
  • Stay in the trade until SL/TP hits or setup invalidates

Section 5 — PH Safety, Fees & Platform Basics

PH basics
  • Use PH-compliant venues: BSP VASP for fiat/VA conversion
  • Check SEC advisories vs unregistered platforms
  • Understand fees, funding/overnight charges, and slippage

Workbook & Practice

Drills
  • Forex lot size drill (3 trades)
  • Crypto quantity & leverage drill (3 trades)
  • SL/TP placement practice with chart snapshots
  • Expectancy tracker (10 demo trades)