How to Read Trading Signals

What Are Trading Signals?

Trading signals are indicators that suggest when to buy or sell an asset. They're generated by analyzing market data, technical indicators, and other factors. Signals help traders make decisions without staring at charts all day.

Components of a Trading Signal

A typical trading signal includes:

• Direction: Buy (Long) or Sell (Short)
• Entry Price: The price to enter the trade
• Stop Loss: Exit price if the trade goes against you
• Take Profit: Target price to close the trade
• Risk/Reward Ratio: Potential profit vs. potential loss
• Confidence/Strength: How strong the signal is

Understanding Strykr Signals

Strykr signals include additional context:

• Sentiment Score: Market sentiment (bullish/bearish)
• Volatility Alert: Expected price movement intensity
• Time Frame: Short-term vs. longer-term outlook
• Related Events: Upcoming catalysts (earnings, Fed, etc.)

How to Use Signals Effectively

1. Don't Blindly Follow

Signals are suggestions, not guarantees. Always do your own research and consider whether the signal aligns with your analysis.

2. Manage Your Risk

Never risk more than 1-2% of your account on a single trade. Use the stop loss provided—it's there to protect you.

3. Consider the Context

A buy signal during a strong downtrend is riskier than during an uptrend. Look at the bigger picture before acting.

4. Track Your Results

Keep a trading journal. Note which signals worked and which didn't. Learn what conditions produce the best results for your style.

Common Signal Mistakes

• Entering too late: If the price has moved significantly, the risk/reward is worse
• Moving stop losses: This turns small losses into big ones
• Overtrading: Not every signal needs to be traded
• Ignoring time frames: A daily signal isn't a scalping opportunity

Practice Before Real Money

New to trading signals? Practice with paper trading first. Track signals without real money until you understand how they perform in different conditions.