They say you must know your risk reward before entering a trade.. The risk part is relatively easy to figure out.. In this case anything outside the 1737 to 1744 box defines risk (of course with size factored in). Thinking long over 1745, what is the potential reward?? 1747 to 1750 "looks" defendable by the shorts but we all know how quickly that can change.. In fact since we "shouldn't" be forecasting and knowing anything is possible how do you calculate reward.
I've been wanting to start a thread regarding risk-reward ratio.
Unless I am misunderstanding it, how can we consider a risk-reward ratio a valid tool, if the reward part is theoretical? The reward part hasn't happened yet since it is in the future. Since the reward is theoretical (and maybe even a highly educated guess based on Technical Analysis) how can we rely on this?