Understanding trading processes is the essence of success in the financial markets. It's not just about pressing the buy or sell button; it involves a series of interconnected steps that ensure discipline, efficiency, and risk management. These processes begin before entering the market and continue even after the trade is closed.

Research and Analysis: Before any trade, traders must conduct thorough research. This includes technical analysis, which examines price patterns and historical indicators to identify potential entry and exit points. It also includes fundamental analysis, which assesses the intrinsic value of an asset by examining the influencing economic, financial, and political factors. This analysis helps develop a clear and justified trading idea.

Planning and Strategy Development: Once a trading idea is identified, a detailed plan is developed. This plan specifies precise entry and exit points, stop-loss levels for taking profits, and position size. The type of order (market order, limit order, stop-loss order) to be used is also determined. Discipline in adhering to the plan is crucial to avoid emotional decisions.

Execution and Monitoring: After the plan is developed, the order is executed in the market. Once the position is opened, it must be continuously monitored. This includes tracking the asset's performance, monitoring relevant news, and reevaluating the plan if necessary due to changing market conditions. Traders must be prepared to adjust or close trades if things don't go as expected.

Risk Management: Risk management is an integral part of every step of the trading process. This includes sizing positions so that potential losses do not exceed a certain percentage of total capital, strategically setting stop-loss levels, and avoiding excessive leverage. Risk management aims to protect capital over the long term.

Review and Improve: After closing each trade, it is essential to review performance. What went well? What didn't? What lessons were learned? This ongoing review helps traders improve their strategies and processes over time