5 Guidelines in Learning to Build Forex Trading Plans
Every trader in his trading must have a trading plan. There is an expression that says “if you don’t have a plan then you plan to fail”. Maybe this sounds cliché but when you trade forex you will definitely believe.
A successful trader has a trading plan that starts with a general description and then applies it to a rule that is used as a reference in transactions. Besides that, it is also important that you make a note or journal of the trading that you do. Having a journal or record will help you later in evaluating your trading plan. Here are some guidelines that you can follow in the process of learning forex to prepare a trading plan:
1. Expectations / Expectations
Why did you decide to go into forex trading and what do you expect from this trading? Building this from scratch will help to keep your trading on track, and prevent disappointment.
2. Plan Risks
Previously, decide how much capital you want to use for trading, of course, this fund will not interfere with your household finances or the harsh language of parking funds. It may sound absurd, but psychologically this will greatly affect your mentality, besides determining how big your target is. Never risk more than you can afford, you must not feel traumatized or discouraged when you experience a loss, for that determine the risk that you are ready to bear from every transaction you make at the beginning. In the sense that once you enter the position at that moment you already know how much risk you are ready to bear.
3. Goal / Target
Set reasonable goals for every profit you want to get in a given period, this must be based on the strategy you use and this target is also calculated based on the daily period for you which includes day trader, the weekly period for you which includes the swing trader and period monthly for those of you who like scalping.
Make a detailed rule of the strategy you use, namely the time frame you use, the indicator that you use as a trigger or trigger and the indicator that is used as a confirmation that is needed before you enter a position whether to give a Buy or Sell signal, you must also determine in detail in the condition of how you exit or close the position, when is the time to take profit or set a stop loss.
This is an important last step but often forgotten or not done by many traders, evaluating your previous trading will make your trading more developed. By evaluating the trading that was done before then you will know whether it is in accordance with the trading plan and your target and also can review your trading losses and find out what the cause is.
If you apply trading recklessly, your trading results will reflect it. The trading plan used will be the basis for your future trading success. So 5 guidelines for building a trading plan, hopefully useful in the process of learning forex.