Trading Plan - How To Build it ? (Educational Post)
Hi Traders. Today's topic is regarding one of the most important success keys about trading. One thing about trading plans, is that they are yet very easy to build it but no one really know to to build it.
Without ABC'S, you can't create words.
Without the words, there are no sentences.
Without sentences, no paragraphs.
No paragraphs, no story.
No story , then no idea what's going on.
No idea what's going on= GAMBLING
Gambling, no consistency.
Imagine you're randomly taking trades with any predefined criteria's in long term does it makes sense? The answer is no, most likely you'll stuck in a chugging condition draining your mental capital. Building a trading plan is something that requires good understanding about yourself. Having a trading plan is very personal. What works for someone else can potentially not work for you. Trading plan is something that requires good understanding of criteria's. Your goal as a trader is to find good deals , execute those good deals and let those deals play out. In this post, we'll assume we are creating our a trading plan
Scenarios:
What Time Frame?
This is the typical textbook explanation, where a traders need to focus his attention in 3 types of time frames. One Macro Time Frame to build the scenario , One meso time frame to manage the positions and One Micro Time Frame to execute. One big problem with Time frames is that sometimes traders lose their mind changing from one time frame to another. if that is your case to do not blow your mind focus your attention in 3 predefined time frames. For example an intraday trader can build in daily , manage the position in h4 but execute in m30.
What conditions?
- This is a rather aggressive criteria's. You must know when to trade and when not to trade. For example trending markets are nice conditions for someone trading pullbacks.
Risk Management
This may seem easy, but believe or not that majority has issues with the money management. keep it simple . Always risk the same amount and understand that you must have a predefined DD tolerance and exposure.
Markets
Most retail don't appreciate the ability to stick to one or few pair pairs for years. You Are pretty much guaranteed success. The skill of being in tune with what you are handle is the key of consistency.
Does it make sense to follow 20 pairs ? no. Stick to few pairs. Lean how they properly move. Every single pair is unique . The key here is in deciding on a single financial instrument or currency pair. You must become familiar with the way it moves, with when it moves, and with exactly how and where it does it. You need to understand the instrument you are trading and be very familiar with the trading style. The typical range of movements both on an intraday basis and on a weekly basis should be understand.
Focusing on one pair allows us to focus our attention on the ultimate goal of trading markets; to generate consistent returns. We do this by attempting to catch a single A to B impulsive movement, preferably from a valid zone. We trade valid signals at valid zones. go on to ten and twenty pairs later. For now, just focus on squeezing a single A to B price movement on a single pair before ever thinking of adding many more.. With the proper seasoning on a certain single instrument, you will become much more confidence with price action and price movements, and trading in general. You will be able to trade in the flow.
This is a tricky one . Some utilize Risk-to Reward based target (Eg. 1:3RR), while some prefer using trailing stops. Personally, having your targets at key technical zones make more sense. There's no right or wrong! It all depends on what suits you the most! if the trend is very strong then it doesn't make sense to set a 1:1 set your targets at the next potential obstacle.
Entries
Strop criteria's.
A stop loss is not fixed. the market structure define where to place your invalidation. It can be behind a zone, behind a supply or demand zone or even behind a ema etc...
Target criteria's.
Let us know in the comment section if there is any other criteria or if I can improve my trading plan. also let us know what criteria's do you use
Trade safe as usual. and make sure to support this idea in order to help the TRADINGVIEW COMMUNITY. I hope it was helpful
Please do follow my profile for daily fx forecast & educational content. I try to share a lot of value every single day.
Without ABC'S, you can't create words.
Without the words, there are no sentences.
Without sentences, no paragraphs.
No paragraphs, no story.
No story , then no idea what's going on.
No idea what's going on= GAMBLING
Gambling, no consistency.
Imagine you're randomly taking trades with any predefined criteria's in long term does it makes sense? The answer is no, most likely you'll stuck in a chugging condition draining your mental capital. Building a trading plan is something that requires good understanding about yourself. Having a trading plan is very personal. What works for someone else can potentially not work for you. Trading plan is something that requires good understanding of criteria's. Your goal as a trader is to find good deals , execute those good deals and let those deals play out. In this post, we'll assume we are creating our a trading plan
Scenarios:
What Time Frame?
This is the typical textbook explanation, where a traders need to focus his attention in 3 types of time frames. One Macro Time Frame to build the scenario , One meso time frame to manage the positions and One Micro Time Frame to execute. One big problem with Time frames is that sometimes traders lose their mind changing from one time frame to another. if that is your case to do not blow your mind focus your attention in 3 predefined time frames. For example an intraday trader can build in daily , manage the position in h4 but execute in m30.
What conditions?
- This is a rather aggressive criteria's. You must know when to trade and when not to trade. For example trending markets are nice conditions for someone trading pullbacks.
Risk Management
This may seem easy, but believe or not that majority has issues with the money management. keep it simple . Always risk the same amount and understand that you must have a predefined DD tolerance and exposure.
Markets
Most retail don't appreciate the ability to stick to one or few pair pairs for years. You Are pretty much guaranteed success. The skill of being in tune with what you are handle is the key of consistency.
Does it make sense to follow 20 pairs ? no. Stick to few pairs. Lean how they properly move. Every single pair is unique . The key here is in deciding on a single financial instrument or currency pair. You must become familiar with the way it moves, with when it moves, and with exactly how and where it does it. You need to understand the instrument you are trading and be very familiar with the trading style. The typical range of movements both on an intraday basis and on a weekly basis should be understand.
Focusing on one pair allows us to focus our attention on the ultimate goal of trading markets; to generate consistent returns. We do this by attempting to catch a single A to B impulsive movement, preferably from a valid zone. We trade valid signals at valid zones. go on to ten and twenty pairs later. For now, just focus on squeezing a single A to B price movement on a single pair before ever thinking of adding many more.. With the proper seasoning on a certain single instrument, you will become much more confidence with price action and price movements, and trading in general. You will be able to trade in the flow.
This is a tricky one . Some utilize Risk-to Reward based target (Eg. 1:3RR), while some prefer using trailing stops. Personally, having your targets at key technical zones make more sense. There's no right or wrong! It all depends on what suits you the most! if the trend is very strong then it doesn't make sense to set a 1:1 set your targets at the next potential obstacle.
Entries
Strop criteria's.
A stop loss is not fixed. the market structure define where to place your invalidation. It can be behind a zone, behind a supply or demand zone or even behind a ema etc...
Target criteria's.
Let us know in the comment section if there is any other criteria or if I can improve my trading plan. also let us know what criteria's do you use
Trade safe as usual. and make sure to support this idea in order to help the TRADINGVIEW COMMUNITY. I hope it was helpful
Please do follow my profile for daily fx forecast & educational content. I try to share a lot of value every single day.
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OTHERS
🟡 linktr.ee/airforexone
If you want to learn our strategy:
🟡 www.airforexone.com/ebookv5
If you want to join our vip discord:
🟡 www.airforexone.com/vipmembership
OTHERS
🟡 linktr.ee/airforexone
