The forex risk management indicator is essential for every trader to have in their toolbox. It helps you calculate how much risk you are taking while opening any position in your trading account.
In your trading account, you need to know the following parameters.
- Account balance
- Risk per trade
And this indicator can get the job done for you.
Working of Risk Management indicator MT4:
Applying this indicator to your charts will open a new panel in your MT4 and display all the parameters listed above.
It will show you your account balance, floating profit loss, and leverage you are using.
It will also display your open positions and their parameters.
Trading Strategy for Risk Management indicator MT4:
This indicator in itself does not give us any signal regarding whether to buy or sell. Therefore, we need to combine it with other indicators like the Relative strength index to trade using this indicator.
Risk Management Indicator MT4 Buying Strategy:
Typically while trading using the RSI indicator, a currency pair is considered oversold when the RSI value is below 30.
We can use Risk Management and the RSI indicators and place buy orders when the currency pair is at an oversold level because there are many chances of it going upward after coming below the RSI 30 level.
We can see the risk, account balance, and other parameters in the risk management indicator mtr4 indicator panel.
The currency pair is overbought when the RSI level is above 70. So here, We can use the risk management indicator with the RSI indicator to take a short position when the RSI value exceeds 70.
There is a high probability of the price coming down.
The risk management indicator gives traders all the information they need from their trading account in MT4 at one glance. We can see all critical parameters using this indicator, and We recommend using this indicator no matter if you are a new or a Pro Trader.