Trade Forex Trading

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

Trading plan checklist - the following is a template examples of a plan template example:

JUSTIFICATION

1. Forex Trading 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 important in your routine to measure how successful you are.

Keep you on target, read the trade plan every day & stick to 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 plan should cover all aspects of trading, you should read 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 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 chances of earning a profit than those who don't have one.

This plan checklist tutorial topic provides with an example plan template that you can use for creating your own trade. By now you've already written down the justification part of your plan template, If not get a pen & paper & write the justification part. Next we shall look at how to write the trade system.

FX 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 plan template which you can use as an example to develop your own trade plan.

One of the most commonly asked question is, Is profitable? one of the methods to make it profitable is to have a good plan.

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

GOALS OF THE TRADING SYSTEM

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

The trade system should find a compromise between the 2 Goals,

Get 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

Moving Average - Spot a new market trend as early as possible.

MACD - Identify a trend as early as possible.

Determine strength of a continuing trend.

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

Extra confirmation tools to help determine the strength of our trend.

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

Trendlines - Signals a reversal when the line is broken

Price Action Signals - confirm the weakening of a trend.

Bollinger Bands - for price action study

To learn more about each indicator & how these indicators can be used to generate signal setups you can go to Technical Indicators Section

CHART TIME FRAMES

  • Main chart timeframe is the 1H.
  • Signals are generated on 15 minute timeframe.

15 Minute Charts

  • Trendlines (Support & Resistance)
  • 5 & 7 LWMA
  • RSI (14)
  • Bollinger Band (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 the price (Support)

When signal gets generated on the 1 H Chart, use the 15 minute chart time-frame to open & close positions.

LONG EXIT

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

RULES

SHORT ENTRY

Entry

15 Minute Charts

  1. Both MAs are heading DOWN
  2. MACD Below Zero Centerline (Not MACD moving Down)
  3. RSI <-< 50
  4. Parabolic SAR is above the price (Support)

When signal is generated on the 1 Hour Chart, use the 15 minute chart time frame to open and close trade positions.

SHORT EXIT

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

ROUTINE

  1. Signals are generated using 1H chart timeframe & executed using the 15 minute chart time=frame.
  2. Trading trading signal to be executed immediately rules are met.
  3. Entry alert signals should be executed during daytime.

TIME OF THE DAY TO WATCH THE MARKET - MARKET HOURS

Watch market during daytime when most companies and online currency online brokers are open for trade transactions. Use this to develop a good program.

Example Plan Template

Written Strategy for Trading Plan Example Template - Forex Plan Checklist

Tips - You can use the MetaTrader 4 Platform to save this as a fx 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 plan template on the MT4 software, read: MetaTrader 4 Software Guides.

FOREX MONEY MANAGEMENT

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

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

FOREX MINDSET/PSYCHOLOGY

  • Trade without Emotions (greed, fear, impulse, bias, anticipation, overexcitement)
  • I trade what I see not what I feel.
  • I'll be patient.

My job isn't to be the trade system!

It is not to decide which trade signal looks promising & which does not.

That's the job of my system - which has a set of 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 IS

To sit patiently & wait for my strategy to indicate that it is time to enter or it is time to exit. And then with great focus I execute forex plan as outlined.

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

GOAL: To have 100 % undivided desire on mastering my ability to execute my FX rules accurately.

The more you develop your ability to step back from price movement and watch market dispassionately, waiting for a signal, the easier it will be to witness the fluctuations of your emotions without getting sucked into them and allowing them to throw you off your game.

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 weaknesses. Use Forex psychology to help you to overcome them.

NB: 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 just as much as I do on entry signals.
  • Always protect my account using stop loss, equity management methods, follow with the market trend direction and always following the rules of my 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 & 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 results before opening a real account.

FOLLOW THIS FOREX SYSTEM

This is the most important part of creating the trading system.

Always follow the rules

Stick with the rules

Be disciplined and patient enough

FOREX Trading JOURNAL

Log all my trades in a journal so as to track my training progress & improve my currency execution methods.

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

Even if you are new to market and you do not know how a system looks like, this trading strategy template example illustrates to you how a trade 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.

Therefore, the aim is to help you create your own complete strategy that is if you are looking for one, by showing you one that's already complete. In fact you can just use it as it is, or make a few adjustments so that it suits your style.

Objective is to help you improve your results by using a plan, & another advantage is that this trade plan will offer you a chance to improve your knowledge and it will help you improve your results and help you make pips when forex trading and keep them so that you do not keep giving them back to the market.

Read this plan training guide about developing a trading plan of your own, along with the learn tutorials & strategies listed at top of this learn guide site.

The Most Beneficial part of using this plan example is the "Money Management Part" you will learn how to trade currencies & minimize risk, which is the most important thing in trading the exchange market.

Forex Plan Checklist - How to Develop a Trading Plan in Forex - Trading Plan Examples - Forex Plan Doc

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