Lot Size Is Known
Let’s look in depth at using the first of the two choices on this BREAK EVEN tab.
You’re already in your trade, so you’ve already set how many lots you have at risk. Now you want to figure out what price you need to aim for to get out at break-even.
Pick the top radio button
Click the top radio option on the Calculator break even tab.
Pick your currency pair
Use the dropdown menu to select which pair you are trading. If you don’t see the pair you want, revisit the Currency Rates tab and click show next to it.
Fill in first leg info
Fill in the 3 key things about your first leg trade: lot size, entry price and stop loss price.
Why don’t you need to enter whether this first leg was a buy or a sell? Because this tool in the Calculator is based on the assumption that your first leg was stopped out, so it knows you were selling if your entry price is lower than your stop loss price and it knows you were buying if your entry price is higher than your stop loss price.
Fill in second leg info
For the second leg, you do need to set whether you are buying or selling.
Why the different options for direction? Well first, it’s up to you whether you think of your trade as a “buy” or going “long“, so we have either option in there (ditto “sell” or going “short”). And because you can use the tab key to quickly go from entry blank to the next entry blank on the tab, we’ve also provided single keystroke letters, S or B, so you can just use that letter to set your direction.
If your first trade was a buy and your second leg is also a buy, that is known as a “closed-leg cost average“. You’re establishing an overall position composed of individual trades, all going in the same direction. You feel that you picked the right direction but just got stopped out too soon with your first trade. See this trade example.
If your first trade was a buy and your second leg is a sell, that is known as a “stop-and-reverse trade“. See this trade example.
Fill in the lot size of your second leg and the price of your entry. Then the Calculator will tell you where to exit to get out at break even.
If you want to go for more than break even, manually enter your price you’re going for in the box ACTUAL ENTRY PRICE. Your potential profit will then be shown in the additional info box below.