Long Position

The Long Position tool is a measurement and annotation tool for planning long (buy) trades directly on the chart. It marks the entry price, stop-loss level below entry, and one or more take-profit targets above entry. The tool automatically calculates and displays the risk-to-reward ratio (R:R) based on the distance from entry to stop versus entry to target. This visual framework ensures that every trade is evaluated before execution in a systematic, repeatable way.

Position sizing and risk management are fundamental to trading success. The Long Position tool helps traders visualize each component of a trade before taking it — ensuring that every trade has a clearly defined risk and at least one defined reward target. The R:R ratio updates in real time as you drag any of the anchor points, making it easy to explore different stop and target positions to find the optimal risk-reward balance before committing capital.

A minimum 1:2 risk-to-reward ratio is generally recommended for long trades. Even with a 40% win rate, a 1:2 R:R yields a positive expectancy over time. The formula for expectancy is: (win rate × average win) − (loss rate × average loss). With a 40% win rate and 1:2 R:R: (0.4 × 2) − (0.6 × 1) = 0.8 − 0.6 = 0.2 — a positive expectancy. The Long Position tool helps you visualize the components of this calculation at a glance.

The tool supports up to 5 take-profit targets, each with its own R:R calculation. This allows for systematic scaling out of winning positions. A common approach is TP1 at 1:1 (close 30%), TP2 at 1:2 (close 30%), and TP3 at 1:3 (close 40%). Each target is automatically labeled with its partial R:R, giving a complete picture of the scaling plan without manual calculation.

1. 1
   Select Long Position

   Click the Long Position tool from the measurement toolbar.
2. 2
   Set the entry

   Click to place the entry point at the planned buy price level on the chart.
3. 3
   Set the stop-loss

   Click to place the stop-loss point below entry at the invalidation level.
4. 4
   Set the first target

   Click to place the first take-profit target above entry at the expected profit level.
5. 5
   Review the R:R ratio

   The R:R ratio displays automatically. Adjust any anchor to update the ratio in real time.
6. 6
   Add more targets

   Use the settings panel to add additional take-profit levels for scaling out.

• Trade planning — plan long trades with clearly defined entry, stop, and target levels before execution. The visual layout makes it easy to evaluate the trade at a glance and reject setups with poor R:R before capital is committed.
• R:R evaluation — visualize risk-to-reward ratios at a glance to ensure trades meet your minimum threshold (typically 1:2 or higher). The R:R updates in real time as you adjust anchor points.
• Multi-target scaling — plan partial exits at multiple targets. For example, exit 50% at 1:1 R:R and move stop to breakeven, then let the remaining 50% run to 1:3 R:R for maximum capture of trending moves.
• Trade journaling — mark past trades on historical charts for post-trade analysis. The visual record helps identify patterns in winning vs losing trades and improves your trading system over time.
• Sharing trade ideas — share trade setups with clearly visualized risk parameters. The R:R display communicates the trade's potential in a universally understood format that any trader can evaluate instantly.
• Position sizing calculation — use the risk distance from the tool to calculate position size. If account risk is $100 and the entry-stop distance is 50 pips, your position size is $2 per pip — the math is automatic.
• Breakeven management — use the first take-profit target as a breakeven-move point. When price hits TP1 at 1:1, close 50% of the position and move the stop to breakeven. The remaining position has a 0: > 1 R:R with no downside risk.

Professional traders typically seek a minimum 1:2 risk-to-reward ratio, meaning the potential reward is at least twice the amount risked. A 1:3 or higher ratio is considered excellent. Even with a win rate of only 40%, a trader using 1:2 R:R can be profitable over time. The Long Position tool visualizes these components so you always know your risk and reward before entering.

The formula for position sizing is: position size = account risk / (entry minus stop distance). The Long Position tool shows the distance so you can calculate appropriate sizing instantly. For example, if you risk $100 per trade and the entry-to-stop distance is 50 pips, your position size is $100 / 50 = $2 per pip. For stocks: position size = $100 / ($50 entry − $48 stop) = 50 shares.

Suppose you have a $10,000 account and risk 1% ($100) per trade. You identify a long trade on EUR/USD at 1.1000 with a stop at 1.0950 (50 pip risk). Your first target is 1.1100 (100 pip reward, 1:2 R:R). Using the distance from the Long Position tool, you calculate: position size = $100 / 50 pips = $2 per pip. At $2 per pip, the target of 100 pips yields $200 profit. The tool visualizes all this directly on the chart so you never enter a trade without knowing these numbers.

• 1.Risk Management for Traders — Investopedia
• 2.The Art of Currency Trading — Brent Donnelly
• 3.Position Sizing — TradingView Help
• 4.Trade Your Way to Financial Freedom — Van K. Tharp
• 5.Risk Management in Trading — John J. Murphy
• 6.Expectancy and Position Sizing — Trading reference