A trading strategy is a set of rules that decides when to enter a position, how to manage it, and when to exit. Before you open Strategy Studio, it helps to know the handful of terms every strategy is built from.
Entries#
An entry is the rule that opens a position. It answers "when do I get in?" — for example, when an indicator crosses a level, when price reaches a zone, or when a market-data event occurs. An entry has a direction: long (betting the price rises) or short (betting it falls).
Exits#
An exit is the rule that closes a position. Most strategies use more than one:
- Take-profit — close in profit when price reaches a target.
- Stop-loss — close at a loss to cap the downside if the trade goes against you.
- Signal exit — close because a condition says the reason for the trade is gone.
A strategy without a defined exit is not a strategy — it is an open-ended bet.
Conditions#
A condition is a testable statement about the market that is either true or false right now — "RSI is below 30," "price is above the 200-period moving average," "funding rate is positive." Conditions are the building blocks of entries and exits. They can be combined with AND (all must be true) and OR (any can be true) to describe precise situations.
Risk parameters#
Risk parameters control how much you commit and how much you're willing to lose:
- Position size — how much of your account a single trade uses.
- Stop-loss distance — how far price can move against you before you're out.
- Leverage — a multiplier that increases both potential gain and potential loss.
Putting it together#
A complete strategy reads like a sentence: "When [entry condition] is true, open a [long/short] sized at [position size], with a [stop-loss] and [take-profit]." Once you can express your idea that way, you can build it. Continue to the Strategy Studio Overview, and read Risk Management Basics before sizing anything.