If you have already read other notes about the fascinating world of the foreign exchange market, known as the Forex or Fx market, you may have been interested in starting to trade.
It is important that every trader in the Forex market knows how to develop a trading plan to carry out your operations and this article will guide you to do so.
In the universe of the foreign exchange market, there are a large number of traders who constantly undertake transactions, however only a percentage of them achieve success. Others fail and end up withdrawing from the market.
Like everything in life, to be successful, you must execute a task plan, or trading plan as it is known in the foreign exchange market, always taking into account that the fundamental bases to be successful in this market consist of being firm and persistent.
To prepare an operations plan according to your objectives, needs, and capabilities, it is necessary to evaluate the following aspects:
1. It is recommended that before starting any operation in the Fx market, you document yourself. You must train yourself properly, instruct yourself through articles, and reports, consult other traders you know, investigate through the Internet, or take courses with experts in the field.
2. It is advisable to try out demo accounts for at least 4 months to master the market, as well as learn about the various strategies that exist to operate. Carrying out tests with the acquired strategies and verifying if they are beneficial or not, is what is called back-testing, which is a vital part of this learning process.
There are numerous mechanisms that will help you prevent mistakes and that will lead you to success, such as the so-called “stop losses” that prevent the total loss of your capital. You must know all of them to do a better job.
3. Being up-to-date with everything that is happening around you can help you make maneuvers that benefit you greatly. It is very important to be up-to-date since the market is very vulnerable and unstable. Do not forget that every day you can find an original strategy to carry out transactions, an updated base, or even a test instrument that could serve you better since you have updated accounts. Always measure your time so that there is free space to do it.
4. Establish a work schedule. This is essential so that as an operator you get used to carrying out operations at the same time every day. It is recommended to operate in the market at least 4 hours a day and permanently at the same time; because the market undergoes changes depending on the schedule.
Therefore, if you operate daily at different times, you will not be able to fully understand the market, which will encourage more failures than successes in your operations.
It is relevant that the time you select is a time in which you do not have distractions in order to fully guide the transactions you make. You must work in demo accounts at different times to determine which time is best for you when doing it in a real account.
5. Another task that you must include in your trading plan is to examine the returns, see how many operations you have made in total to understand how many were failures and how many were profits.
In this way, you will be able to analyze the strategies that were favorable to use again in other opportunities. It will also help you to see what your mistakes have been in operations so as not to make them again later.
6. In the foreign exchange market there are 2 forms of analysis of operations: the fundamental and the technical analysis.
In the technical model, the operators apply different indicators, statistics, and formulas to carry out their operations, while with the fundamental examination, the operators are helped by the news of the day, such as increases in the price of gold, bank interest rates, decreases in employment, etc., since according to this news they react and already begin to carry out transactions to find a way to benefit.
For your trading planning you must take into account which of these 2 methods you will use for your operations, and thus be able to adapt it without complications. It is each person’s choice if they decide to use both methods for their transactions.
Of course, all the recommendations mentioned will be coupled differently to each of the operators as already mentioned. The schedules and the way of making the plans vary since each trader has different needs, different goals, and different times.
Discipline and perseverance will undoubtedly greatly increase your chances of success in the market. It will be very easy for you to dominate the market and manage your operations if you have a plan to help you, which is essential to be successful.
In Summary, This Is What You Should Implement In Your Trading Plan:
3. Tactics and types of studies
6. Evolution of results.