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Today 14 – A Successful Daily Trading Plan
Why do you need a trading plan?
It helps you stick to the system and discipline.
It reduces emotional and hasty decisions.
It increases the chances of making profits and reducing losses.
Components of a daily trading plan:
Defining entry points:
Through support and resistance or indicators like RSI and MACD.
Defining stop-loss:
A point to exit if the price moves against you, to protect capital.
Defining take profit:
The price at which you plan to take profits.
Defining position size:
Do not risk more than 1-2% of your capital on a single trade.
Recording the trade:
Record every trade you made: when you entered, the price, the reason, and the outcome.
Reviewing and evaluating performance:
At the end of the day or week, review your results and learn from your mistakes.
Important tips:
Stick to the plan no matter the temptation.
Do not increase the position size when losing in an attempt to quickly recover.
Learn from every trade, even the losing ones.
Today's exercise:
Prepare a trading plan for just one day.
Define the currency pair, entry points, stop loss, and profit targets.
Execute the trade according to the plan.
Record all the details and review them at the end of the day.
