Position Sizing
The planned entry is around 4,027.41, with the stop-loss placed near 4,005.39. This creates a total risk distance of approximately 22.02 points. Based on the amount I am prepared to risk on the trade, the position size is set to 9 contracts.
The take-profit is positioned around 4,123.20, giving a potential reward of approximately 95.79 points. This produces a risk-to-reward ratio of roughly 1:4.35.
In simple terms, I am risking about 22 points to potentially make almost 96 points. The stop-loss is placed below the strong low and the lower boundary of the range, where the bullish setup would be considered invalidated.
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Alex Sharp
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Position Sizing
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