It is very important to be your own trader and to never follow someone else’s trading assistance carelessly without entirely knowing about it. The methods that work for them might not work for you. You need to have your own forex trading plan and improve it as you study and learn from the market, since traders do not have the same market views, understanding and procedures, risk tolerance levels, and have different market experiences.
Two main parts of trading discipline are developing “Trading Plan” and “Sticking To.” You also need more than just trading discipline; It has to be Rock Solid discipline.
A Trading Plan describes what needs to be done, why, when, and how it is done. It hides your trader personality, personal expectations, trading system, and risk management rules.
The reasons why traders need a trading plan is because it will make trading simpler than it would if you traded without having one.
Just like Global Positioning System (GPS device), you enter where you want to go. It will then figure out where you are at the moment and lets you know how to get to where you want to go. You can always check on your GPS to know if you are still on the right direction. It can make an adjustment for you and It will guide you to the right track.
Not having a Trading Plan is not a good idea since you would not know how to get your target. A trading plan will help maximize trading mistakes and decrease your losses.
Having a trading plan is very helpful because you will be able to know if you are doing or going to the right position.
You will have a structure to weigh your trading presentation, and just like a Global Positioning System GPS, you are able to observe this frequently.
Most importantly, if you draw at trading, and you definitely will at the start, you will recognize it is down to one for two reasons:
- There might be a problem with your trading plan
- You are probably not sticking to your trading plan
It is hard to know if what you’re doing is right or wrong if you do not have a Trading Plan. It is also impossible for you to assess your results, so you will never know how to stop pulling. Remember to always have a Trading Plan! Keep this in mind: “If you fail to plan, then you’ve already planned to fail.”