The methods are easy to follow and will help build your confidence.
They should also lead to better trading discipline and measurable outcomes.
So what is a trading plan?
Essentially, a trading plan is a business plan you apply to the markets – a business plan built with something called ‘rule-based trading’.
Rule-based trading gives you the tools to identify trading opportunities within your chosen market.
While market psychology is important, rule-based trading takes away the guesswork of entry and exit points, and provides a justification to act both when entering and exiting a position.
By developing a rule-based trading method, you will develop an understanding not only of your market of choice, but also the risks and potential outcomes available to you.
What’s the first step?
The first step in building a provable and robust rule-based trading system involves finding a market with the right levels of volatility and that’s in your time zone.
That means you need to take some time and use inward reflection to choose a market that you have a particular interest in.
It’s important to remember that rule-based trading plans belong to you, the individual.
Finding one that belongs to you means taking an experimental idea and testing it across your market of interest. In doing so, you should develop a robust trading method that will give you the confidence to place money at risk and deal with future market movements.