Trading Questions Answered
Clear, expert answers to the most common trading questions. From chart patterns to risk management, get the knowledge you need.
Chart Patterns
What is the success rate of cup and handle patterns?
Quick answer: 65%
How accurate is the head and shoulders pattern?
Quick answer: 72%
What is the success rate of double bottom patterns?
Quick answer: 66%
What is the win rate for bull flag patterns?
Quick answer: 67%
Which direction do ascending triangles usually break?
Quick answer: Upward 75%
Elliott Wave
What are the 3 rules of Elliott Wave?
Quick answer: Wave 2 never retraces 100%...
How long is wave 3 in Elliott Wave?
Quick answer: Usually 161.8% of Wave 1
What are corrective waves in Elliott Wave?
Quick answer: 3-wave A-B-C patterns
What is the impulse wave structure?
Quick answer: 5-wave pattern: 1-2-3-4-5
What timeframe is best for Elliott Wave?
Quick answer: Daily and weekly charts
Fibonacci
What are the key Fibonacci retracement levels?
Quick answer: 23.6%, 38.2%, 50%, 61.8%, 78.6%
What is the golden ratio in trading?
Quick answer: 61.8% (0.618)
What are Fibonacci extension targets?
Quick answer: 127.2%, 161.8%, 261.8%
What is the best Fibonacci level for entry?
Quick answer: 50% to 61.8% zone
What is Fibonacci confluence?
Quick answer: Multiple Fib levels aligning
Risk Management
How much should I risk per trade?
Quick answer: 1-2% of account
How do I calculate position size?
Quick answer: Risk $ ÷ (Entry - Stop)
What is a good risk reward ratio?
Quick answer: Minimum 1:2 (risk 1 to make 2)
Where should I place my stop loss?
Quick answer: Below support/pattern low
What is the maximum daily loss rule?
Quick answer: 2-5% of total account
Trading Basics
What is swing trading?
Quick answer: Holding trades 2-14 days
What is the difference between day trading and swing trading?
Quick answer: Holding period and frequency
What are support and resistance levels?
Quick answer: Price zones where buying/selling pressure changes
What are candlestick patterns?
Quick answer: Visual price representations showing open, high, low, close
Why is volume important in trading?
Quick answer: Confirms price movements and breakouts
Calculators
How to calculate position size for stocks?
Quick answer: Risk amount ÷ Distance to stop loss
How to calculate pip value in forex?
Quick answer: Lot size × Pip movement × Exchange rate
How does compound interest work in trading?
Quick answer: Reinvesting profits to grow account exponentially
How to calculate ROI on trades?
Quick answer: (Gain - Cost) ÷ Cost × 100
What win rate do I need to break even?
Quick answer: Depends on risk/reward ratio