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Posted on Feb 18, 2019 at 04:03 PM
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How to Achieve Your Everyday Profit Goal By Planning Your Trades

As a pupil in primary school, the quote, "If you fail to plan, you plan to fail" was rang into my ears I could recite it even from sleep. At that time, it wasn't much of a big deal until I got into the university where I was solely responsible for my life and outcome and the amount of work I put into studying actually determined the result I got. This is a lot more like Forex trading where you are actually responsible for the result (profit) you make.This brings me to the question, How can you achieve your profit goals just by simply planning your trades?

If your goal is to become a successful trader who makes it big in the Forex market, it's is very essential that you have a trading plan.

A Trading Plan is like a trading Bible, where you document all the necessary trading rules. It does not only incorporate your strategies and how you will decide to make a trade, it will incorporate risk management as well as defined entry and exit plans.

Successful traders do several things that amateurs often forget. They plan a trading strategy, they follow the markets, and they track, and analyze each of their trades.

There is no such thing as an ultimate trading plan, because there are no two exactly the same traders, and every trader has a different trading style, strategy, risk tolerance levels and market experience.

It is always better to develop your own personalized trading plan and modify it as your experience grows.

Having a trading plan will help you stop making ridiculous trades as it will keep you from getting overly excited or making bad risk management decision.

How Should You View A Trading Plan?

A trading plan should be thought of as a template for trading the markets. Perhaps, a even as a check list. 

This check list will contain different aspects of making a trade in a logical step by step sequence that acts as your objective guide to trading the markets.

In essence, a trading plan will state your overall short and long term goals as a trader and will provide you with a clear check list of how to achieve them.

For example, employing bad money management, bad timing, bad risk management alongside a winning strategy will only result in a disaster as you need more than a winning strategy alone to trade profitably.

It might be a little time consuming building trading plans, testing and retesting, checking trades, and backtesting but trust me, it's definitely worth it.

What Should You put in Your Trading Plan?

Is your next question, how can I create a trading plan and what exactly should I put in my trading plan? You are right on course and you would be gleaning the breakdown of the requirement of your trading plan below.

  1. The Trading Strategies you're going to Trade.
  2. The Currency Pairs you're going to Trade.
  3. Your daily Routine.

1. The Trading Strategies: You should begin your trading plan with your trading strategies so if you are trading price action setups, off key structure levels, structure trading or advanced patterns, then you should put them first.

This will act as a blueprint for what you need to do each time you interact with the market. You need to backtest your strategies in order to find out wherever they meet positive expectancy, i.e they can make you money or not.

In addition to your strategies, you need to put your risk tolerance and your money management rules.

Having  written strategies with your risk tolerance and money management is like having a market blueprint which is essential for developing the discipline that will lead you on the road to success.

Not following the rules in your trading plan is tantamount to deviaton from the plan.

2. The Currency Pairs: The next thing to do is to state the instruments you are trading. For example, you may only be focusing on the EUR/USD, or both the EUR/USD and GBP/USD. Make sure to state this in your plan.

You don't have to trade everything, you may need to focus on the assets you are familiar with till you master them and move on to some other.

You could decide what to trade per time e.g In July, I'm going to trade currencies, oil in August but this should already be in your plan.

3. Your Daily Routine:

The trading phase is divided into three, Pre-Market Phase, Trading Phase and Post Market Phase.

For your pre-market phase, be sure to write all you will be doing from waking up to what you will do before you sit at your trading computer or start trading on your mobile device..

During your trading phase, follow your checklist as this is crucial in order to put yourself in high probability trading opportunites; this will include things that you look for in the market and what you want to see before entering a trade.

In your post market phase, your main activity will be record keeping your trades. A trading journal is important because it allows you to analyse your trades and to find out whether you follow the trading plan or not.

Make sure you maintain a trading journal which has logs of all your trades. This is important because it allows you to analyse your trades and the success of the plan adopted by you.

It should include the entry date, entry price, exit price, stop limit, total profit/loss and final notes which are your personal notes on each trade.

Your daily routines are crucial for your trading success because based on them, you build a ritual that help us maintain a high level of focus and a state where we perform at our best level.

All top athletes or sportmen go through their own ritual in order to perform at their best level and so should you.

Your trading plan should contain a written description of what you will do in the markets, this includes things like what your trading edge is, how you trade it when you trade it, the time frames you trade, your strategy for risk management and profit taking, and your overall goal as a trader.

Dear trader, this seems as a lot of work and it definitely is. However, if your goal is to stay profitable in the Forex market, the essence of a trading plan can not be over-emphasized so you need to up and create one.

In the next article, I'll share with you The Ten Elements of a Trading Plan so you can seamlessly create your own trading plan.

What do you think about the discourse? Do you have a trading plan? Would you create your right away! I'm desperately itching to read from you so be kind enough to leave a comment and I would be sure to respond to every one of them!


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Previous Comments

  • ABIJOGUN ABIODUN RAPHAEL
      Feb 28, 2019 at 02:41 PM

    I made payment on 25/2/2019 and my expired trasaction ID is 1551101587.Pls help credit it thanks

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  • MURTALA ADAMS MICHAEL
      Mar 01, 2019 at 12:05 PM

    I don't have a trading plan and don't no how to create one, I will like to learn. Thank you.

    View Replies Reply
  • TYDOLLAR
      Mar 01, 2019 at 05:25 PM

    i need currency Pairs to Trade.

    View Replies Reply

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