Trade Forex Trading

How to Write a Good Forex Plan - Written Example Trading Plan Template

plan checklist - the following is a template examples of a plan template exemplification:

JUSTIFICATION

1. Forex IS A BUSINESS, BUSINESSES WHICH ARE SUCCESSFUL ALWAYS HAVE PLANS

  • Businesses that are successful always begin with a plan.
  • Successful business planning will guide you to success, think of trade plan as a map: it is a constant reminder of how you'll consistently pull profits from the currency market.
  • Difference between a successful trader & a losing forex one is the trade plan.

2. TO KEEP ME IN THE RIGHT DIRECTION

Consistency is vital in your routine to measure how successful you are.

Stay Focused by Reading Your Trade Plan Daily and Following Its Rules

In your plan you should think of it as a map which shows you this is what you follow, it should have clear rules that specify when you open or close trade.

Your trading plan should thoroughly cover all the factors and aspects of trading, you should read and study the plan every day until it is on your fingertips so that when you are transacting on the fast moving market of currency exchange you'll always know what to do in every situation.

Your trading plan can be as simple or complex as you prefer: what's most important is that you have one. Having a plan provides you with an edge over the market, significantly improving your chances of achieving profitable trades compared to those without one.

This checklist gives a sample trade plan template. Use it to build your own plan. You should already have the justification section written. If not, grab a pen and paper now. Next, we will cover how to create the trade system part.

Having a specific FX strategy is a key thing that can help you as a market participant to make more money when trading. A helpful guide about trading currencies, like this one, should show you how to develop one using a sample strategy. You can use it as a guide to create your personal trading strategy.

People often ask if FX trading makes money. A solid plan is one way to turn a profit.

IF YOU HAVE A GOOD FX PLAN AND ARE DISCIPLINED ENOUGH TO STICK TO IT When Forex Trading YOU WILL BE SUCCESSFUL.

OBJECTIVES AND GOALS OF THE TRADE SYSTEM

  1. Ability to IDENTIFY TREND AS EARLIEST AS POSSIBLE .
  2. Ability to AVOID WHIPSAWS .

The system should find a reasonable middle ground between the 2 Goals,

Get a way to identify a currency trend as earliest as possible but also find methods to help you distinguish fake out whipsaw signals from real signals.

Roles of Each Part in the Indicator

MA - Spot a new market trend as earliest as possible.

MACD - To ascertain a directional movement as soon as feasible.

Determine power of a continuing trend.

RSI - Swing failure to confirm the start of a new trend.

Additional technical confirmation tools are available to assist in assessing the momentum of our identified trend.

Parabolic SAR - Help to ensure that we aren't caught up on wrong side of the trend.

Trend lines - Signals a reversal when the line is broken

Price Action Signals - confirm weakening of a trend.

Bollinger Band - for the price action study

To dig deeper into each indicator and how you can use or combine them for signal setups, head over to the Indicators section.

CHART TIME FRAMES

  • Main chart time frame is the 1H.
  • Signals are generated/derived on 15 Min timeframe.

15 Min Charts

  • Trend lines (Support and Resistance)
  • 5 & 7 LWMA
  • RSI (14)
  • Bollinger Bands (20, 2)

RULES

LONG ENTRY

Entry

15 Minute Charts

  1. Both Moving Averages are moving UP
  2. MACD Above Zero Center-Line (Not MACD heading UP)
  3. RSI >-> 50
  4. Parabolic SAR is below price (Support)

If a trading signal is generated on the 1-Hour chart, traders are advised to utilize the 15-minute chart timeframe for the actual opening and subsequent closing of the positions.

LONG EXIT

  1. RSI provides a in the opposite trend signal
  2. Price breaks Support Trendline
  3. Parabolic SAR is hit (Trailing Stop)

RULES

SHORT ENTRY

Entry

15 Minute Charts

  1. Both Moving Averages are heading DOWN
  2. MACD Below Zero Center Line (Not MACD moving Down)
  3. RSI <-< 50
  4. Parabolic SAR is above price (Support)

Spot signals on the 1-hour chart. Enter and exit on the 15-minute frame.

SHORT EXIT

  1. RSI gives and provides a in the opposite trend signal
  2. Price action breaks Support Trendline
  3. Parabolic SAR is hit (Trailing Stop)

ROUTINE

  1. Signals are generated using 1H chart time frame & executed using the 15 Min chart time-frame.
  2. Trading trading signal to be executed immediately the rules are met/matched.
  3. Entry trade signals should be executed during the day time.

TIME OF THE DAY TO MONITOR THE MARKET - MARKET HOURS

Watch the market during the day when most businesses and currency brokers are working. Use this to make a helpful plan.

Example Plan Template

Written Strategy for Trading/Transacting Plan Example Template - Forex Plan Checklist

Tips - You can use the MetaTrader 4 Software to save this as a fx template that way you don't have to lay it afresh every time you open a new trading chart. If you want to learn how to save a plan template on the MetaTrader 4 platform software, read: MT4 Platform Guides Courses.

FOREX MONEY MANAGEMENT

  • Intraday trading - Low risk High return trading method
  • Trade when I have a high risk-reward ratio 3:1 or more
  • Stoploss = Parabolic SAR

  • Set TP target 40-60 Pips
  • Never transact beyond three % of account equity
  • Never risk more than 2% on one trade transaction

FOREX MINDSET/PSYCHOLOGY

  • Trade without Emotions (greediness, fear, impulse, bias, anticipation, overexcitement)
  • I trade what I see & not what I am feeling.
  • I'll be patient.

My job isn't to be the trade system!

It isn't to decide which trade signal looks promising & which does not.

My trading system is designed precisely for this purpose - it provides a fixed set of rules that dictate my actions. It is crucial not to react impulsively to price changes, but rather to adhere strictly to your established parameters.

MY JOB IS

I make it a point to wait patiently for my strategy to flash a signal - when to jump in or when to get out. Then, I follow my plan with total focus.

Taking trades not indicated by the trading system, second guessing it & not taking signals given, hesitating & getting in late, anticipating & getting into trade positions early are all common-place & boil down to lack of faith in plan & not having a burning resolve on accurate trade execution.

OBJECTIVE: To establish an absolute, unwavering commitment to flawlessly implementing my FX established protocols.

Developing the ability to observe market fluctuations objectively, without emotional involvement, is key for traders. By doing so, you'll better manage emotions and avoid reactions that could disrupt your trading strategy.

WEAKNESS

  1. I am greedy.
  2. I over-trade
  3. Make a listing of all your weaknesses that are interfering with your trading. This is the first step to help you to overcome these weak-nesses. Use Forex psychology to help you as a trader to overcome them.

Acknowledgment: By documenting your shortcomings, you will become increasingly aware of them as you advance: recognizing these faults will naturally lead to their avoidance, thereby enhancing your performance outcomes.

GOALS

  • To focus on exit just as much as I do on the entry signals.
  • Always protect my account using stop loss, equity management methods, follow with the market trend direction and always following the trading rules of my trading strategy.
  • Never second guess or go against my strategy. To always keep up my discipline.
  • Follow all the rules of my strategy and never break them.
  • Transact fewer times and execute all my signals rightly. Trade what I see, what the system + currency charts are telling me.
  • Sit patiently & wait for signals from my strategy.
  • Achieve consistent forex results before opening a real/live account.

FOLLOW THIS FOREX SYSTEM

The most crucial aspect of developing a trading system is this.

Always follow the rules

Adhere strictly to the established trading protocols.

Maintain discipline and exercise patience.

FOREX Trading JOURNAL

I will meticulously record every trade in a journal to monitor my progress and refine my currency execution techniques.

This strategy uses momentum to identify trend of any currency pair.

If you are new to trading and unsure about systems, this template shows a basic setup. Other parts of this site explain key details you need to know.

The goal is to guide you in creating a complete trading strategy, or optionally using a ready-made one. You can adopt it as-is or make adjustments to better align with your individualized trading style.

A trading plan helps improve your results as a trader. It builds your knowledge and boosts performance. You can make pips in forex and hold onto them instead of losing them back to the market.

Look at this guide to learn how to create your own trading plan, along with the learning guides and plans that are listed at the top of this learning website.

The most valuable aspect of utilizing this example plan is the "Money Management" component, where you will learn how to trade currencies while minimizing risk, which is paramount in trading on the exchange market.

Forex Plan Checklist: How to create a trading plan in forex - Examples of trading plans - Forex plan document.

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