TRADING PLAN FOR A TRADER

All forex traders expect consistent and maximum profit. How to get consistent and maximum profit? There are many answers to this problem but in this paper I concentrate on telling the story of the importance of trading plan for a trader.

Many people who just entered the forex trading world forgot about this despite having heard from experienced traders that a trader must have a good trading plan.

Just a story I hear from various sharing experiences in discussion forums or articles, generally they forget about this because of "high spirit" to get profit in the shortest possible time and profit as much as possible. But finally give up because it is not a profit but lost all the funds. If giving up briefly just for self-evaluation and start again may provide a fun new experience but what if surrender and do not want to enter the world of forex again? If this is the case, their forex testimony is always negative about forex. "Forex is a danger" Poor donk if a bad experience that exactly disharekan, yes would certainly make others afraid to enter the world of forex and forced not to enter the forex is very promising economic life better. Poor if this is how. They close the door for those who want to enter and enjoy forex and its advantages.

Let's get back to the point. A trader must have a good trading plan or trading plan. before trading or transactions in this case "open position" is required to have good planning, correct and mature. When should the plan be made? There are traders who say the plan can be done when there is free time like Saturday or Sunday, or maybe when the market is not in accordance with our analysis and expectations.

The main function of trading plan is to prevent us as traders malakukan transactions are inconsequential and reckless. Lots of traders, especially beginner traders make transactions without a clear reason. The transaction is only based on feel or emotion alone. That is way,  the trading plan is needed.

There is no definite reference for a good and correct trading plan. In essence we as traders make trading planning that brings benefits and minimize the risk that will occur. We make plans, and we do the same. We must discipline to follow the planning that we have made no matter what the conditions

How to make a trading plan? The steps we need to do are:

1. Determine market entry time

We must determine when we enter the market, for example we specify we enter the market during the American session. Yes at the time of the Asian session we are not allowed to make transactions, because we have made a plan to enter the market during the American session.

2. Mature analysis

Before doing the transaction we do the analysis. The analysis that we do must be mature and have a clear foundation. Our analysis should not be based on feeling or feeling, about what the market wants to go up.

3. Set targets and risks

After doing the analysis, we can determine where we will conduct transactions (at what price), buy or sell transactions. In addition we are also required to determine the targets and risks that we take.

4. Determine the Lot used

After determining where to do the transaction and where resiko.nya, determine the lot based on risk, not based on the target. Suppose we have a balance of $ 1000 and will only do 1 transaction and we risk 2% of capital in one transaction. We calculate the risk we take first. 2% x $ 1000 = $ 20. Suppose the stop loss distance is 20pips (4 digits). Then the lot used is $ 20/20 pips = $ 1 / pips or lot 0.1.

5. Resign

After we make a transaction, we must surrender whatever happens we must accept. Want our profit or loss is important we have done according to the planning that we make.

The steps to make the above trading plan are not standard. Please develop your own. Hopefully this article useful and provide additional insight for traders as well.

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HIGH RISK WARNING: Foreign exchange trading carries a high level of risk that may not be suitable for all investors. Leverage creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully consider your investment objectives, experience level, and risk tolerance. You could lose some or all of your initial investment; do not invest money that you cannot afford to lose. Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions. Admin