TradingView’s Long & Short Position Tools

Mastering the Art of Trade Planning: A Guide to TradingView’s Long & Short Position Tools

In the fast-paced world of trading, visualization is everything. Whether you are scalping Bitcoin or swing trading equities, knowing exactly where you stand before you enter a trade is crucial. Enter TradingView’s Long and Short Position Tools—features designed to help you calculate risk, define targets, and execute trades with precision.

In this guide, we’ll break down how to use these tools effectively, from basic placement to executing live orders directly from your chart.

Long vs. Short: The Basics

Before diving into the tools, let’s clarify the difference:

• Long Position: You are buying an asset anticipating the price will go up.
• Short Position: You are selling an asset anticipating the price will go down.

While the mechanics of the two tools are identical, they calculate profit and loss (P&L) in opposite directions. For this guide, we’ll focus on the Long Position tool, but remember that everything applies in reverse for the short tool.

1. Placing the Tool on Your Chart

To get started, select the Long Position tool from the left-hand toolbar. Once selected, click anywhere on the chart where you intend to enter the trade.

• The Entry Point: The specific price level where you click becomes your “Entry Price.”
• Default View: You will immediately see a visual representation of your trade with a green area (profit target) and a red area (stop loss).

Pro Tip: You don’t have to keep the tool where you placed it. You can drag the entire tool to visualize potential trades at different price levels, allowing you to “test” scenarios before committing.

2. Visual Adjustments & Risk Management

One of the tool’s strongest features is its interactivity. You can adjust your trade parameters directly on the chart without typing a single number.

• Drag to Adjust: Simply grab the handles at the top (Take Profit) or bottom (Stop Loss) of the tool to move them.
• Real-Time Stats: As you move the handles, the tool automatically recalculates your Risk/Reward Ratio.

For example, if you aim for a 3:1 Risk/Reward ratio, you can visually drag your Take Profit target higher until the ratio hits 3. This means your potential profit is three times your potential loss.

3. Deep Dive: The Settings Menu

For precision traders, double-clicking the tool opens the Settings Menu, which offers granular control over your trade plan.

Inputs

This is where the math happens. You can customize:

• Account Size: Enter your total capital (e.g., $1,000) to see how this specific trade impacts your portfolio.
• Risk: Define your risk appetite by percentage (e.g., 3%) or a fixed dollar amount. The tool will automatically calculate the quantity/lot size you should trade.
• Entry & Targets: Instead of dragging handles, you can type in exact price levels (e.g., Entry at $70,000, Target at $75,000). You can also define targets using Ticks if you prefer that over price levels.

Customize the look of the tool to match your charting aesthetic. You can change the colors of the Stop/Target areas, increase the font size of the stats labels, and ensure “Always Show Stats” is checked so the data doesn’t disappear when you move your mouse away.

4. From Planning to Execution

Perhaps the most powerful feature is the ability to turn your plan into a real order.

1. Connect Broker/Paper Trading: Ensure your brokerage or TradingView Paper Trading account is connected.
2. Create Limit Order: Right-click on your Long Position tool and select “Create Limit Order.”
3. Review & Submit: An order ticket will pop up, pre-filled with the exact Entry, Stop Loss, and Take Profit prices from your tool.

This seamless integration ensures that the trade you execute matches the trade you planned perfectly.

5. A Practical Example

Imagine you are watching Bitcoin consolidate in a box pattern between support and resistance.

• The Plan: You decide to go Long if the price breaks out above the current resistance.
• The Setup: You place the Long Position tool at the breakout level. You drag your Stop Loss just below the recent support “box” (invalidating the trade if price drops back in). You set your Take Profit at the previous high.
• The Result: The tool instantly shows you if this trade is worth taking. If the Risk/Reward ratio is poor (e.g., less than 1), you might delete the tool and look for a better setup. If it looks good (e.g., 3.85 ratio), you can execute the order immediately.

Conclusion

The Long and Short Position tools are more than just drawing aids; they are essential risk management calculators. By visualizing your outcome before you enter the market, you remove emotion and trade with a plan.

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Disclaimer: This blog is for training and learning purpose only.

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