The 4 simple steps to create a successful trading plan for a beginner
Upon the request of many beginner students I have put a 4 step plan together to get you started. This plan is more applicable to the beginner and less to the advance trader. Although all traders can learn something by applying the relevant sections below.
- Trade at the same time Daily
- Decide on which time you can trade and be in front of the screen daily.
- Make sure you will show up on the same time daily.
- Choose 2 timeframes, eg. D1 & H4 or H1 or M15. (This is for the first 30 trades). Do your best to stick to your plan.
- This will also help you to concentrate on one pair at a time understand the chart patterns.
- For Example you are trading 180 Phase Changer H4 and you can be in front of the screen only at 8pm EST, then you will have an idea of the news patterns, Price action pattern and also you will be able to follow the trend trades.
- After you master this step you will move onto Interbank radar and spot the trend reversal trades. For you to spot the trend reversal trades you must start to pick the ‘with the trend’ trades first. The next step will give you more clarity on reversal or phase 2 trades.
- Trading the same time will start a habit within you and you will create consistency daily.
- Even for 30 minutes it is ok to show up in front of your trading terminal.
- You can also watch other traders trade at that time and pick up trade ideas from them, ask them questions and reconfirm your trade analysis. (This feature is available in your Smart Charts in SC Connect section).
- Diary your activity
- Buy a diary (with 1 day to a page) that is specifically for your trading activity.
- Divide each day in 2 sections
- On the top of each page just write the currency pair that has the ‘high impact’ news coming out that day. This will keep you alert when you are tempted to take a trade. It is much better to wait for the news and make the order after the news.
- Section 1 is the Watch list – This list is for all trade ideas that you find in trend and satisfying some of your conditions. This list could also be used you to keep an eye out for the entire week because the trend is in your favor but the signal hasn’t been generated yet.
- Your watch list could also include trade ideas from other traders in Smart Chart that you can look at later.
- Just remember that you are building up your trading knowledge now. The more you write here and look for extra confirmation signal the better you will get understand the price action concept in every pair.
- Prepare your questions in advance
- This means you can take the highest advantage from your 1-1 Coaching Activity. If you are prepared you will get so much more out of communicating with your coach. I have some students that come up with their top 2 or 3 questions and chart shots and within 10 minutes they get the answer which helps them in their next trade. The rest of the time is then dedicated to find more trade ideas and advance you to the next step.
- Review your week/ month
- Each weekend you must review your last week trades. At the end of the month review the last month.
- Highlight things that stand out that you did well and also if some action you could have taken differently.
- A losing trade is not necessarily a bad trade if you executed it with precision and your plan.
- A winning trade is not necessarily the best trade if you didn’t apply any rules.
- This review will help you step up to the next level fast and with confidence.
- Again all new traders welcome to Learn to Trade. I wish you a successful journey ahead. Let me know how you go with this plan. This is a simple plan that will give you results if you follow it precisely.
To your prosperity,
Psychology of Trading Specialist