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Trade Rules
0.50%- 1.00% risk per trade,
Only look for trades on the hour timeframe and above. This will filter a lot of unnecessary noise and reduce your chances of getting caught in a fake-out.
Analyze, prepare then execute
Self review yourself weekly
Backtest often
ALWAYS wait for trade confirmation, DON’T RUSH INTO A TRADE
NEVER TRADE ABOVE 60% OF YOUR CAPITAL, always allow room for your trades to play out even when in drawdown
Make sure you’re following the overall trend
Always check forexfactory.com for news events and fundamental updates
DO NOT, DO NOT OVERTRADE!
The most disciplined trader will make the most money
EXIT WINNING POSITIONS, take profits along the way, stop waiting to hit a home run on every trade
THINK OF THE NEXT 1000 TRADES NOT THE NEXT 10, PLAN TO STAY IN THE GAME.
Build out a proper plan, Figure out the time of the day to trade your pairs. Always manage your risk, keep it anywhere from 1-2% depending on your risk tolerance and financial situation. Some people risk more because they don’t care if they blow the account.
Learn how to manage expectations, Stop self-sabotaging yourself because you feel the market owes you.
Do not change your analysis to execute a trade, let the trade come to you. Consistency comes from believing in yourself, not from chasing trades. If you can’t see it then there’s no trade.
Stop trying to call tops and bottoms, that is not how you trade. You must realize that as a retail trader you are working beside billion-dollar institutions that can make the market move in the direction they want. Price levels do not matter if there is no confirmation to support the idea.
As a retail trader, you must move with the financial institutions, let them do the lifting while you sit back and ride their tail. Before executing a trade calculate the probability and use that to find your risk percentage. Treat your charts like a road map.
Remember to think 2-3 steps ahead. The ability to think ahead allows you to manage your trades effectively and reduce the panic that occurs when the market is not moving as you anticipated. Understand the long-term approach and put yourself in the best position and deductive reasoning that will allow you to make the right play.
Understand the markets and what your limitations are. If you are the busy type then don’t expect this to come easy without making sacrifices. Trading is a lifestyle, that is the first thing you should learn.
Plot your entry and exit points, that will reduce the anxiety you feel.
Look back at what you have learned. Do not try to learn forex if you think it will be your only way out of debt, YOU WILL FAIL.
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TRADE ASSESSMENT QUESTIONS
What are the market conditions?
Is there a news event?
Is the price action clear or choppy?
What is the ongoing trend?
Am I using a good lot size?
Can I risk less now then scale up later?
Do I feel comfortable holding the trade without watching it?
How long do I plan on holding the trade ? what is my goal in pips?
In trading whatever is going to happen will happen, whether You like it or not.
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BECOMING A PRO TRADER
LEARN ABOUT YOURSELF
Learn about what stresses you, causes your emotions to unravel, your dependency on money, and why you are actually trading. The more honest you are the faster you can change these ideas and put things into work to manage your emotions and discipline. Stop saying things to motivate yourself. If you are hungry you get food, you just don’t sit talking about what you are going to eat. You go out to get some food and eat. Mark up your charts and make realistic goals. How do you do that? You test your strategy then take advantage of the gains you have done and reduced it by half and that is a safe goal.
DO NOT FORCE TRADES
Learn to sit on your hands sometimes and not touch the charts, there are no missed opportunities, just poor planning. If you want an opportunity set yourself up for it. As your analysis skills get stronger you will start seeing information and predicting movements way before they are happening. The key here is to make sure that you let the trade develop. Just because you see something doesn’t necessarily mean that it will happen in your time. Being able to frame your analysis and then apply it to your trading plan will ensure you don’t act on an impulse. There is no need to force a trade. The market does not care how good your analysis is, let the market dictate when you take a trade. You have to think about what you are doing before you do it, trade with a plan. You need to be able to anticipate the next move and determine how you will react to it. Look at your charts and anticipate the movements before taking the trade. You have to realize that trade setups come around constantly so you don’t have to rush it.
YOUR COMPETITION
.Do not compete with anyone but yourself. If the goal is 50 pips a day, don’t jump around the charts. One day you may get 50 pips, the next three days you may not get anything then you may get 300 pips on the fourth, It all evens out. If you are winning trades don’t be surprised. Trading is simple when you fully understand how to trade. Trading day in and day out is the hard part, that is where traders fail, stick to your plan and grind it out. The top Hedge funds in the world make 15-20% gain over a few months so what are you doing trying to pull 30% from the market every day? .Trading is not a 9-5 job, maybe there is a trade maybe there isn’t.
JOURNAL YOUR TRADES
Track your trades. Mark the ones that brought you the best profit and the ones you lost money. Focus on the winning trades and be aware of the mistakes you made in the losing ones, avoid those mistakes.
TRUST YOUR ANALYSIS
Everyone does not see the same thing you do. The question is who has bigger balls to hold the position as the market is being manipulated for institutions to get their price. Trust your analysis and if you are afraid to swim with the sharks that's fine, wait for the water to settle and pick up the crumbs. Trying to be a hero in the market is a recipe for disaster. Take what the market gives you and be happy.
MAKE TIMELY PLANS
Whether you make 1 dollar or 100k in a day, if you don’t have a 1 week, 1 month, 6month and a one year plan laid out, how do you expect to see progress ?. When you are going to the gym you follow a routine. Follow your trading plan day in and day out the market will take care of the rest. Set realistic goals to keep your confidence, realize everything takes time and focus.
TREAT TRADING LIKE A JOB
Treat trading like a job and pay yourself. The biggest mistake traders make is sitting on the charts like its a 9-5 job, it isn’t, IT’S A LOT WORST THAN THAT. If you have problems getting away from the computer take a pen and paper and log how much time you spend doing anything trading related. Then figure out how much you are profiting, some of you will realize that you are earning less than minimum wage. Stop chasing money and let the money come to you. Trading is very hard but if you stay level headed and have a plan that you follow you will be fine. FOCUS ON WHAT MATTERS AND BE EFFICIENT WITH YOUR TIME.
STOP MAKING COMPARISONS
Stop making comparisons in your life with others. Trading psychology is probably the hardest thing you will deal with and it will be tested every day you trade. Don’t copy trades. Being uneducated on why someone else took the trade will rattle your confidence and will greatly affect your judgment. The more you learn the more confident you become. The same thing with your analysis. As your skills get sharper so does your confidence which will then allow you to increase your success. Stop wasting time on social media when you should be studying. The faster you focus on yourself the better off you will be.
PUT IN THE WORK
Becoming consistent is determined by the time and effort you put in the charts and research. You can read 100 books and still suck. There is no such thing as a holy grail, the best strategy is your own. The sooner you figure that out the faster you’ll be profitable. A mentor will only do so much for you, most mentors will walk with you but you’ve got to put in the work too.
DO THIS EVERY WEEKEND
Look at the past week through various timeframes and moments do you see anything that stands out ?. If so, make some notes and return to them when there is a clearer picture.
Review the news for the coming week and consider how it would affect your analysis. I suggest to stay out of the trade until the news passes, the news may give you a better entry point who knows.
Review your trading plan, what are the things that made you money last week and what made you lose it. Did you hold it too long or too short?. Figure out where you were right and make that your priority this week.
Talk to people, get some insight and ask questions. There is always going to be someone faster, smarter or more experienced than you.
TRADING WITH SMALL AMOUNTS
.Think about this from a realistic standpoint, If you are starting with just $200 you do not have a good shot with long term trades. The problem with long term trades is that your stop loss will have to be large to allow the trade develop. All it takes is for one trade to go bad and your account can lose a huge percentage. Money management is key but also be realistic with your trading plan. It may be easier to take small portions of a trade and be more consistent until you build your account up to a significant balance. Do not try to learn forex if you think it will be your only way out of debt, you will fail.
GETTING AN EDGE
Remember everyone is looking at the same charts you are, in order to stand out you’ll need an edge. An edge could come from waiting a bit more before entering a trade to get better confirmation. It could be trading off pivot points where new trends are going to form. It could even be as simple as approaching your risk in a certain way. No one says you have to hit home runs whenever you trade. Trading is a marathon, not a sprint. Longer timeframes may move slower, but they give you an idea of the overall market.
PAY ATTENTION TO DETAILS
Pay attention to details. There are so many small details you can learn as a trader each day. Do you know when your pairs move the most? Do you know when you are the most profitable? Do you know how to anticipate movements during the market open and closing? Little details when you are charting and doing analysis will give you those edges you need in the market. There is so much more to trading than clicking buttons. The more you learn the greater your edge in the market.
OBSTACLES
One of the biggest obstacles to trading will be learning to train your mind to take pennies from the market. You are going to look at your $300 and say, How am I going to turn this into $1000. Don’t ask how to, focus on how long. It is very possible, but the only way to get there is through working hard and putting the time in. Every pip is a step forward. Every positive trade is a step forward and every negative trade is a lesson. Don’t trade with money you can’t afford to lose and most importantly, don’t trade to make money. Trade because you have a passion to better yourself and discipline yourself to learn a new skill. The money will come.
STUDY MORE THAN YOU TRADE
Build and update your trading system. Refine and practice your strategy
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