Understanding Risk-Reward in Crypto Trades

For new folks in crypto, one of the most fundamental concepts to grasp is risk-reward. Essentially, it's about evaluating the potential profit of a trade against its potential loss. If you're looking at a $WETH trade, you might set a stop loss at, say, $0.9801 and a target at $1.1732. This means you're risking $0.0899 (if current is $1.07) to potentially gain $0.1032, giving you a risk-reward ratio of roughly 1:1.15. A good rule of thumb is to look for trades with a risk-reward ratio of at least 1:2 or higher to make sure your winning trades cover more than your losing ones over time.