Your trading plan is your A-Z guide for how you will approach the Forex markets. Your trading plan should help you navigate your way through every trading day with a clear set of instructions for you to follow that will aid your success
What's in your Trading Plan ?
Ideally it should cover :
Pairs
Sessions to trade
Capital/Money
Pre-Trade routine
Strategies
Risk management
When, what and how you will practice
Analysis of how you are doing - Journaling
Any questions that relate to your trading journey should be in your trading plan so that anything you do is not done impulsively and without thought
What happens when you don't follow your plan?
The main risk of not following your trading plan is LOSING MONEY.
If you decide to trade a session that you aren't used to or familiar with then you could lose money
If you decide to not follow trade your normal strategy and trade impulsively you could lose money
If you do not follow your normal risk management rules and over-risk then you could lose money
Your trading plan should detail the best actions for you to take to make sure you don't lose money
Does your plan suit you?
If your plan does not suit your personality and lifestyle then it will be more difficult to follow.
For example if you only have the mornings to trade before work then choosing to look for trades in the middle of the day might not work for you.
If you have 6 strategies to choose from but you are only confident in 1 or 2 then don't use the others until you have done enough back-testing and are comfortable with the ones you are using
If you cannot relate with parts of your trading plan then you will not trust it or follow it so make sure that you agree with it completely
How to follow your plan
Make sure your plan is suitable for you
Make the steps easy for you follow
Break it down into different sections
Review it daily before your sessions
Focus on the parts you struggle with the most one by one
Conclusion
Really try to drill down all of the details of your trading plan and make sure that you can relate to it. This is essentially your trading business plan. You need to believe it in to ensure your success in the markets and be able to follow it consistently throughout your journey
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