RetailTerminal | Academy - Placing a Trade

Academy Chapters

1. Getting Started 2. Placing a Trade 3. Keeping a Journal 4. Further Reading

2. Placing a Trade

Before executing any trade, ensure your setup satisfies all four fundamental execution pillars. Jump directly to a section below:

→ 1. You have an edge (Practical Example) → 2. The risk you are taking has been determined → 3. A fundamental analysis has been made in advance → 4. A technical analysis has been made

1. You Have an Edge

An edge is a repeatable process where macro fundamentals, technical confirmation, and risk management come together to give you a statistical advantage over the market.
Below is an example of an edge. If a large candle with high volume moves in the right (fundamental bias) direction, wait for the pullback before placing the trade.

Step 1: Fundamental Bias (Strong USD / Weak EUR)

Fundamental analysis in this example indicates a strong US Dollar and a weak Euro. This macro imbalance establishes a clear preference to trade short on EUR/USD.

Step 2: Technical Confirmation (Breakout & Volume)

Technical analysis reveals a strong bearish candle breaking downward accompanied by high volume, confirming institutional selling pressure.

Strong bearish candle with high volume confirmation

Figure 1: High-volume bearish breakout candle confirming downward momentum.

Step 3: Waiting for the Pullback

Rather than chasing price immediately after the breakout, wait patiently for price to pull back toward the broken support structure.

Figure 2: Price pulling back toward key resistance before entry.

Step 4: Short Entry & Risk-to-Reward Execution

Once there is a significant pullback (e.g., 50%-61.8%), enter a short position on EUR/USD with a defined Stop Loss above the pullback high and a Take Profit set for a minimum Risk-to-Reward ratio of 1:2.

Short entry on EUR/USD with 1:2 Risk to Reward ratio

Figure 3: Executing the short trade with a 1:2 Risk-to-Reward profile.

2. The Risk You Are Taking Has Been Determined

Never enter a trade without calculating your exact monetary risk in advance. Position sizing must ensure that a single loss represents only a small percentage of total capital (e.g., 1%).

3. A Fundamental Analysis Has Been Made in Advance

Fundamental context provides the directional driver behind price movements. Always align trades with interest rate differentials, economic growth dynamics, and central bank trends.

4. A Technical Analysis Has Been Made

Technical analysis delivers precise execution timing, structural entry levels, and clear invalidation points to execute the fundamental bias efficiently.