Hi, fellow traders!
I've been working on coming up with a trading plan that combines fundamental drivers, market sentiment, as well as technical levels (S/R's, fibonacci levels) to produce trade selections with the highest winning probability. This approach, I believe, can present very high quality entries with very tight stops, therefore we can use smart money management to exploit the excellent risk/reward ratio.
To keep myself motivated and disciplined, I want to start posting my daily trading plans to chronicle my every move in the market, including real trades taken with specific entry and exit (before it actually happens, of course). If there are other people following my live trades with me, I think that will help keep me disciplined and accountable for my trade selections and management.
My protocol:
1. Trade only 2 pairs: EUR/USD and EUR/JPY. The reason is because I feel this will keep my trading easier to manage and I also feel that if you can become expert at one or two currencies, that's really all you need to be very profitable.
2.Trade European/London session, spanning roughly 3:00 am. - 9 am. EST.
3. Trade 3 days a week: Tuesday, Wednesday, and Thursday.
4. I will first scan my news resources for the latest developments around the world that could have an impact on my currency pairs. These sources include:
- Bloomberg.com
- Dailyfx.com
- Forexfactory.com (the homepage always have news highlights and expert commentaries.
- Pfxglobal.com (they provide free daily outlook videos which really give you a good idea of the general bias on each currency pair, which is based on both fundamental and technical variables. Very good education for new traders who want to develop a well-rounded trade plan.)
5. I will open my charts and look at the latest price movements on the pairs I trade, as well as the pairs I don't trade but have close correllation with, and thus influence on my currency pairs.
6. Based on fundamental and technical data gathered from above-mentioned sources, I'll determine overall bias of the pairs for the day. I will then decide what my main objective of the day will be e.g. buy on weakness, sell into a rally, or buy/sell on a break of an important S/R level etc.
7. Lastly, I will determine potential areas for entry AND exit, as well as predetermined stop loss for each trade. My personal strategy sometimes calls for a few small losses (due to tight stops), but it also gives possible re-entry points, whose target profit (if hit), will make up for the small losses with a large chunk of the profit added to the continuing growth of the overall account balance.
8. My trades will almost always be closed at the end of the day. If in profit I take what I get. If in negative, I take my losses even if my SL hasn't been hit. There's always tomorrow to trade a new set-up in better markets. I will NEVER leave the computer when trading and leave my fate up to mechanical stop-loss. During crisis situations where markets are in panic mode (like what we've had the past month), mechanical orders can NOT be trusted, IMHO.
So to get this trading journal/journey started, my next post will be my trading plan for today. Granted today is a Monday, and my trading plan calls for trading only Tuesday, Wednesday, and Thursday, I'll do this today just to give myself a template that I can use point-forward, and to get things rolling!
I've been working on coming up with a trading plan that combines fundamental drivers, market sentiment, as well as technical levels (S/R's, fibonacci levels) to produce trade selections with the highest winning probability. This approach, I believe, can present very high quality entries with very tight stops, therefore we can use smart money management to exploit the excellent risk/reward ratio.
To keep myself motivated and disciplined, I want to start posting my daily trading plans to chronicle my every move in the market, including real trades taken with specific entry and exit (before it actually happens, of course). If there are other people following my live trades with me, I think that will help keep me disciplined and accountable for my trade selections and management.
My protocol:
1. Trade only 2 pairs: EUR/USD and EUR/JPY. The reason is because I feel this will keep my trading easier to manage and I also feel that if you can become expert at one or two currencies, that's really all you need to be very profitable.
2.Trade European/London session, spanning roughly 3:00 am. - 9 am. EST.
3. Trade 3 days a week: Tuesday, Wednesday, and Thursday.
4. I will first scan my news resources for the latest developments around the world that could have an impact on my currency pairs. These sources include:
- Bloomberg.com
- Dailyfx.com
- Forexfactory.com (the homepage always have news highlights and expert commentaries.
- Pfxglobal.com (they provide free daily outlook videos which really give you a good idea of the general bias on each currency pair, which is based on both fundamental and technical variables. Very good education for new traders who want to develop a well-rounded trade plan.)
5. I will open my charts and look at the latest price movements on the pairs I trade, as well as the pairs I don't trade but have close correllation with, and thus influence on my currency pairs.
6. Based on fundamental and technical data gathered from above-mentioned sources, I'll determine overall bias of the pairs for the day. I will then decide what my main objective of the day will be e.g. buy on weakness, sell into a rally, or buy/sell on a break of an important S/R level etc.
7. Lastly, I will determine potential areas for entry AND exit, as well as predetermined stop loss for each trade. My personal strategy sometimes calls for a few small losses (due to tight stops), but it also gives possible re-entry points, whose target profit (if hit), will make up for the small losses with a large chunk of the profit added to the continuing growth of the overall account balance.
8. My trades will almost always be closed at the end of the day. If in profit I take what I get. If in negative, I take my losses even if my SL hasn't been hit. There's always tomorrow to trade a new set-up in better markets. I will NEVER leave the computer when trading and leave my fate up to mechanical stop-loss. During crisis situations where markets are in panic mode (like what we've had the past month), mechanical orders can NOT be trusted, IMHO.
So to get this trading journal/journey started, my next post will be my trading plan for today. Granted today is a Monday, and my trading plan calls for trading only Tuesday, Wednesday, and Thursday, I'll do this today just to give myself a template that I can use point-forward, and to get things rolling!