Trading plan & co

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Gamma_gallus
Trader
Posts: 118
Joined: Wed Nov 16, 2011 2:03 pm
Location: France

Trading plan & co

Post by Gamma_gallus »

I'd like to centralize in this thread, the different materials one should use to trade.

So, please feel free to correct me if I'm wrong or add any useful comment !

It's commonly said that ideally, any trader should have below documents:

1- A trading plan - a long term document in which you set up your goals, trading conditions, psychology :

- Why are you trading (for living ? for fun & excitement?) ?
- How much are you willing to loose on the market (ie your capital balance, so implies you do not mortgage your house or put the money you put aisde to pay the kids university) ?
- The daily & monthly target to achieve your goals (pips or money)
- The amount of risk in any trade you're ready to go with.
- All trading conditions, by this I mean, writting a clear and detailed agenda for each trading day, for example: trading hours, taking note twice a day the market conditions for the pairs you're trading (ranging, trending?) , print the news of the day (to avoid trading X min before and after a high news) etc ..
- Psychology (please see this thread http://www.stevehopwoodforex.com/phpBB3 ... f=23&t=255) : do not trade if .. bla bla bla ...

etc... trading is a business so you have to get organized like a professional, with a strict daily agenda !
Stick it to the wall if short, otherwise read it quite often to never forget it.

2- Trading strategy(ies)
One paper for each strategy you follow, with all details (entry, exit, SL, TP etc....)
Get them always close to the screen, even if with the time you know them by heart (to avoid the temptation of taking positions "almost" fitting the conditions)

3- A trade journal
To update each time you open & modify a trade. This should include the details shown in the trade history (date, entry price etc..) but the most important is : how you were emotionally speaking when you took this position !
Details to be analyzed later (ideally each evening), to help you to fine tune your systems, to understand why a trade failed, or went good. For example, a trade goes bad and is about to hit your SL, but somehow you feel lucky today, and you decide to move further down your SL, because "hey I know the market will retrace back and finally move in my favour ..", but bad luck, price continues is way down to finally kick your ass out of the game !
By taking those kind of notes, you'll quickly learn the lessons and hopefully never do them again.

It's late, I'll complete this topic later if I notice that I forgot something important, when reading it with a fresh mind ..

Gamma
coleen
Posts: 4
Joined: Thu Feb 14, 2013 11:54 am

Re: Trading plan & co

Post by coleen »

Have anybody worked with this plan? What are your thoughts as to it?
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