How to Write a Good Forex Plan - Written Example Trading Plan Template
Trading plan checklist - the following is a template examples of a forex trading plan template example:
JUSTIFICATION
1. Forex Trading IS A BUSINESS, SUCCESSFUL BUSINESSES 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 important in your routine to measure how successful you are.
Keep you on target, read the trade plan every day and stick to its rules.
When it comes to your trading 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 forex plan should cover all aspects of forex trading, you should read the forex trading plan every day until it is on your fingertips so that when you are transacting on the fast moving market of currency exchange you will always know what to do in every situation.
Your forex plan can be as simple or as complicated as you like, but the most important thing is that you have one. By having a one you have an advantage over the market, you will have better odds of making a profit than those who do not have one.
This trading plan checklist tutorial topic provides with an example trading plan template that you can use for creating your own forex trade. By now you've already written down the justification part of your trading plan template, If not get a pen and paper & write the justification part. Next we shall look at how to write the system.
Forex plan is one of the secrets that can help you to improve your profits. A good currency training guide like this one should show you how to come up with one using a forex trading plan template which you can use as an example to develop your own trade plan.
One of the most commonly asked question is, Is Forex profitable? one of the methods to make it profitable is to have a good plan.
IF YOU HAVE A GOOD FX Trading PLAN AND ARE DISCIPLINED ENOUGH TO STICK TO IT When Trading YOU WILL BE SUCCESSFUL.
GOALS OF THE TRADING SYSTEM
- Ability to IDENTIFY TREND AS EARLY AS POSSIBLE .
- Ability to AVOID WHIPSAWS .
The forex trade system should find a compromise between the 2 Goals,
Find a way to identify a currency trend as early as possible but also find ways to help you distinguish fake signals from the real ones.
FUNCTIONS OF EACH INDICATOR
MA - Identify a new trend as early as possible.
MACD - Identify a trend as early as possible.
RSI - To confirm the begin of a new trend.
To learn more about each indicator & how these indicators can be used to generate trading signal setups you can go to MA Crossover Method then RSI Strategy and then MACD Indicator Technical Analysis
CHART TIME FRAMES
15 Minute Chart: Signals are generated on 15 minutes time frame.
RULES
LONG ENTRY - Buy Signal
- Both MAs are moving UP
- MACD Above Zero Center Line (Not MACD moving UP)
- RSI above 50
SHORT ENTRY - Sell Signal
- Both MAs are moving DOWN
- MACD Below Zero Center Line (Not MACD moving Down)
- RSI below 50
EXIT Signal
- RSI gives opposite signal
- MACD gives opposite signal
ROUTINE
- Signals are generated using the 15 minute chart time frame.
- Trading signal to be executed immediately trading rules are met(not before).
- Entry alert signals should be executed during daytime.
TIME OF DAY TO WATCH MARKET - MARKET HOURS
Watch market during daytime when most companies & online currency brokers are open for trade transactions. Use this to create a suitable program.
Example Plan Template
Tips - You can use the MT4 Forex Software Platform to save this as a forex template that way you do not have to lay it afresh every time you open a new chart. If you want to learn how to save a trading plan template on the MetaTrader 4 platform, read: MT4 Save Workspace Guide.
FOREX MONEY MANAGEMENT
- Day trading - method
- Trade when I have a high risk to reward ratio 3:1 or more
- Set Stop loss Orders
- Set TP target 40-60 Pips
- Never transact beyond 3 % of account equity
- Never risk more than 2% on a single trade transaction
Learn Forex Money Management Methods:
FOREX MINDSET/PSYCHOLOGY
- Trade without Emotions (greed, fear, impulse, bias, anticipation, overexcitement)
- I trade what I see not what I feel.
- I will be patient.
My job isn't to be the trading system!
It is not to decide which signal looks promising.
That is the job of my forex system - which has a set of forex rules that tells me this is what I follow. Don't get caught up in price action and make rules as you go along.
MY JOB DESCRIPTION IS:
To sit patiently & wait for my forex strategy to indicate that it is time to enter a trade or it is time to exit a trade. And then with great focus I execute my forex plan as outlined.
Taking trades not indicated by the forex system, second guessing it and not taking signals given, hesitating and getting in late, anticipating & getting in early are all common place & boil down to lack of faith in the trading plan & not having a burning focus on 100% accurate execution of the trading plan.
GOAL: To have 100% undivided focus on mastering my ability to execute my Forex trading rules accurately.
The more you develop the ability to step back from price movement and watch market dispassionately, waiting for a signal to trade, the easier it will be to witness the fluctuations of your emotions without getting sucked into them allowing them to throw you off your game.
WEAKNESS
- I am greedy.
- I over-trade
- Make a list of all your weaknesses that are interfering with your trading. This is the first step to help you overcome these weaknesses. Use Forex psychology to help you overcome them.
Note: by writing down your weaknesses you will start recognizing them as you make progress, once you do this you'll start to avoid these mistakes & your results will improve.
GOALS
- To focus on exit signals just as much as I do on entry signals.
- Always protect my account using stop-loss, money management methods, follow with the trend direction & always following the trading rules of my trading strategy.
- Never second guess or go against my trading strategy. To always keep up my discipline.
- Follow all the rules of my Forex strategy and never break them.
- Transact fewer times & execute all my signals correctly. Trade what I see, what the system + currency charts are telling me.
- Sit patiently and wait for signals from my strategy.
- Achieve consistent forex trading results before opening a live account.
FOLLOW THIS FOREX SYSTEM
This is the most important part of creating the trading system.
Always follow the trading rules
Stick with the trading rules
Be disciplined & patient enough
FOREX TRADING JOURNAL
Log all my trades in a forex trading journal so as to track my training progress & improve my trade execution trading methods.
This trading strategy uses momentum to determine trend of any currency pair.
Even if you are new to forex market & you don't know how a trading system looks like, this forex trading system template example illustrates to you how a Forex strategy should look like, the tutorials explained in other sections of this training website will also explain further the different aspects which you need to learn.
Hence, the aim is to help you come up with your own complete trading strategy that is if you are looking for one, by showing you one that is already complete. In fact you can just use it as an example template, and make a few adjustments to it so as to come up with your own trade plan template that suits your forex trading style.
Objective is to help you improve your forex trading results by using a forex plan, and another advantage is that this forex trade plan will offer you a chance to improve your knowledge and it will help you improve your trading results and help you make pips when forex trading and help you keep them by using rules such as forex money management methods which you will write in your trading plan, so that you do not keep giving the pips back to the forex market.
Read this forex trading plan training guide about developing a trade plan of your own.
The Most Beneficial part of using this forex trading plan template is the "Money Management Part" you will learn how to minimize risk when trading currencies, which is the most important thing when it comes to trading the forex exchange market.
Forex Trading Plan Checklist: How to Develop a Forex Plan Beginners Tutorial and a Forex Trading Plan Example Template Explained.
