Here it is, my own trading strategy with the whole world to watch and review. I’ve asked trading expert Kim Krompass from the Price Action Institute to review my own plan and discover holes on it to allow it to be better so I could correct and improve. In my opinion in reviewing some thing with significant thinking therefore that I may turn into the best I could and earn money in the markets. So first you may notice my plan then you might find Kim’s opinions. In addition please talk about this short article via societal networking and also leave your own opinions within my forex currency trading plan from the comments department.
Core Values: Mission Statement
The point of trading: my own trading will probably match together with my heart values in life to live a whole and fulfilled life in my children and my area in my own world. This ‘s quite simple merely a one-sentence announcement to help me maintain my vision infront of me that I don’t lose sight of it.
Foundational Components of the plan:
I am going to trade Monday through Friday 8 a.m. And 8:30 every day I’m going to spend 30 minutes a day 5 days a week trading I’m going to be looking at the weekly and daily time frames. I am looking to hold trades for 3 days up to 3 months. With a target of 300 to 1000 pips and a risk to reward of minimum 1 to 1.
My strength is my ability to read the charts into where the market is going and also my understanding of technical analysis.
My weakness is following the plan maintaining the discipline do I need to execute my strategy.
Profit goal is 10% return on investment in the first quarter of 2015.
To Follow Trading Plan.
To do quarterly reviews of my plan.
Step 1: Daily Process
I believe successful trading is a process and I will go through the same process every day the same way before I make a trade. I will continue to use the same process until I purposely change it because I believe I have found a better way. So as I am explaining the strategy remember this is the same step-by-step process that I use that I will use every day when analyzing the charts. This will be a simple strategy since I am only trading for 30 minutes a day I have to have something and find a good trade.
Step 2: Technical Analysis
My strategy will be using weekly and daily charts to identify the trend. I will use trend lines to determine the direction of the trend that I’m trading. Once I find a good trend I will then use support and resistance levels to find a potential entry area. I will also check Fibonacci levels for confirmation. I will also be looking for price action and Candlestick patterns such as pinbars and engulfing candles to plan my entry.
Step 3: Fundamentals Analysis
I will check the news reports and fundamental numbers and write a statement on where I believe the fundamentals are telling me the pair will go.
Step 4: Plan the Trade
Once everything is lined up I will begin to lay out the actual trade. I will set an entry order or market order at the location where I want to enter the trade. If you don’t have a fantastic trading plan you can neglect. Click To Tweet
Risk To Reward:
I am searching for a 1 to 1 minimum risk to benefit ratio in my trades using a objective of 3 payoff a single hazard. Considering these trades have a massive time period and can require a while to grow I shall hazard upto 5 percent each trade. With a objective of 15 percent What this means is when I win an individual trade by reaching my goal I shall already have struck my profit target for that quarter. I am going to be inclined to add places to your trade. I shall add in the event the purchase price goes in favour or against mepersonally.
Here would be the terms I can add:
- If I secure an extra cost action signal within my own direction.
- If I struck a second resistance or support level.
I will incorporate a total of 3 rankings that may equal a total of 5 percent I shall add 3 percent over the very first trade and each extra position will add 1 percent of hazard to this trade.
Stop Loss Movement:
I will lock profit dependent on the purchase price activity of the everyday bar.
Trade Example: To demonstrate the practice of the way I trade.
I have 5 factors of affirmation see above picture:
The fundamental outlook for Australian Dollar looks to be advancing with recent occupation amounts advancing and recent cost rebounds. In addition, feeble jpy is much obscured by the BOJ and they’ll soon be capable of making the feeble yen in the event at all possible.
1 additional incentive for this particular trade is favorable swap to the trade.
Swap Rates Below:
Input at 96.89 with initial tp of 10 3 = 607 pips If the purchase price looks good during that time I arrive at TP can stretch TP for additional Gains. Risk 3 percent with a stoploss at 90.89 = 604 pips. Add additional 1 percent together with price actions or resistance or support areas.
Outside trade strategy review:
By Kim Krompass of this Price Action Institute – Follow Kim on Twitter
Trade Plans, for example some other plans, if or not they have been for a company or for the private life have 3 things in common so as for one to be prosperous. They Have to be:
- Measurable and
- Time jumped
Casey’s trade plan has touched all 3 parts which make plans or goals powerful. Before I dive in to a number of the regions which could possibly be improved, I want to look at exactly what makes a fantastic plan.
Recently, I dined at the famous French Laundry restaurant in Yountville, CA.
If you’re not knowledgeable about the restaurant, then it’s been called among the Best Restaurants on earth and features a Michelin 3 star score. The restaurant has made a lot of awards and accolades from the media and one of food critics international.
You will find two items that struck me to the French Laundry adventure. Initially was how nicely the firm is, and also the way a world-renown Chef’s from your kitchen are after recipes which may guarantee a more successful results of food. Today whether you like the meals ( and frankly, I didn’t care for a lot of the food) is not the point.
What is the point, however, is that both the operation of the French Laundry and the food preparation follows a 5 step success plan:
- Vision-the chefs have a beautiful picture of what the food is to look like as it lands on your table and they want your experience in the dining room to be like royalty
- Sequence- they have an exact sequence of steps to go through for the dining experience
- Specific Ingredients- they know the exact ingredients they must use to prepare the food
- Measurement of Actions- they know the specific measurement of each ingredient in each dish they prepare.
- Deadlines – they know the exact time and temperature they must use to produce such exquisite dishes. There are 2 sittings each night for dinner and you must be on time.
So on to the trade plan:
The vision for “why” you trade must be specific. The reason all of us trade is to make money. Now the “why” of what you want to make the money for should be clearly stated. Just being a good family person is not motivating enough to keep you focused day in and day out, especially when times get hard in the markets.
All traders want to make money. But again. . .let’s be specific. For example:
I will make $20,000 trading by December 31st, 2015 in order to take my family on a European vacation in May 2016. Or I will increase my retirement income trading by 10% in 2015 and use it to pay off our mortgage. Or I want to make $1000 a month to save for retirement. That’s being specific as to how much money you want to make and why you want to make it.
So in Casey’s plan, he has several areas where he is specific. Trading times will be Monday through Friday 8 AM – 8:30 AM. He wants a 10% profit by the end of the 1st quarter in 2015.
He has a specific risk to reward of 1:1 and he will risk no more than 3% per trade. But there are gaps or holes that still need to be addressed.
Like a recipe, I would like to see his vision, his actual sequence of steps, the specific ingredients, the measurable actions and more deadlines. What would that look like? I will make $500 a month in 2015 trading to help fund my daughter’s college education account. I will hunt for my setups Monday through Friday 8 AM – 8:30 AM. I will only take trades or use pending orders to take trades using the 5 confirming signals on a daily/weekly chart. I would forget the fundamentals as that is a subjective and very hard to quantify. I will risk no more than 3% per trade and I will only take trades that have a minimum of 1:1 risk to reward.
At the end of the 1st quarter in 2015, I will review my progress and make any adjustments if needed.
It is simple. . .it is straightforward and you know exactly why you are doing what you are doing every day you sit down to look for trades.Here are some ofthe trading conditions you want to avoid in the forex market.
I want to thank Kim for taking the time to help me become a better trader and to help all of you see the process that we are going through so that you can go through a similar process in the creation of your forex trading plan. Please share your comments on my plan or on Kim’s comments. I do plan on making some adjustments soon because of Kim’s feedback.
Please leave a comment below if you have any questions about this trading plan!
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