Trader's trading plan for every day. Trading plan. Preparing to open a deal

If you don't have a plan, then you are planning to fail.

Benjamin Franklin - one of the founding fathers of the USA

If you make a mistake while trading on the market, you pay for it immediately. In the truest sense of the word. For this reason, planning in trading is not just an option, but a mandatory part of the strategy for achieving the goal. In this article we will talk about what a trading plan should look like - a set of rules according to which a trader acts.

These rules define the principles of entering the market, the rules for calculating the volume of positions and determining the targets around which it is necessary to exit the market, as well as the role of technical analysis indicators, news and other methods of market analysis when making trading decisions.

If you have a clear trading plan, which spells out all the possible options for reacting to various market movements, then you will not doubt the correctness of your trading decisions, and the likelihood of making emotional transactions that are detrimental to your trading account will decrease significantly.

A trading plan, along with a trading diary, will help you become a more disciplined trader and allow you to effectively use your time, money and nerve cells.

What is a trading plan in trading?

If a trader does not have a trading plan, then in the long term the probability of losing money in the market tends to 100%. I have seen dozens of proofs of this rule while working in the brokerage business. My first trading accounts also became a clear confirmation of this. Traders who regularly lose money in financial markets most often do not have a trading plan and open and close trades on a whim; or there is a trading plan, but it is ignored at the most inopportune time.

I note that one of the biggest difficulties of this type of business is to follow a trading plan in a disciplined manner. It is enough to ignore it once to erase the trading results of previous weeks or months. Discipline is the basis of trading, but it will be meaningless without a clear plan of action that defines what you can do and what you absolutely cannot do.

Quote on topic

Don't be a hero. Don't stick out your “I”. Be critical of yourself and your capabilities. Don't flatter yourself for a moment. If this happens, you will be finished.

A trading plan is a document that you need to fill out yourself. It can be in paper or electronic form and should be on hand when trading the financial markets. It is very convenient to use Google Docs - your trading plans, as well as trading sheets and diaries, will be available on any device.

Perhaps you trade several accounts and trading strategies at the same time: for example, the first account is medium-term rebound trading on the Daily; the second is intraweek trading on the H1 and H4 timeframes. In this case, it is necessary to draw up two trading plans. This will allow you to make every trading decision as carefully as possible, and also, when the transaction is closed, will allow you to understand how well this trading operation corresponded to your trading system.

What does a trading plan consist of?

A trading plan must consist of at least five elements. Each of them can be presented as an answer to the question:

This is the “skeleton” of a trading plan, each point of which must be written out in detail independently in accordance with the trading approach used, risk appetite and the specifics of the markets being traded (presented below for medium-term trading on the market).

Not all points of a trading plan are equally important. Some need to be adjusted to suit your trading style (Points 1, 2 and 3), others should never be ignored or significant changes made, otherwise trading on this account will end extremely quickly and sadly (Points 4 and 5).

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- What advice could you give to those who want to succeed in the markets?
- I think the most important element is to have a plan. First, a plan maintains discipline, which is a necessary ingredient for successful trading. Second, the plan gives you a benchmark against which you can measure your results.

Howard Seidler - professional manager, one of the Turtles

As a rule, the need to clearly define your trading system becomes obvious when a trader loses his second, or less often, his first trading account. In most cases, a trading plan is seen as an option: “I already know when to enter and exit the market, I’ll write down the rules later.” After some time, the trader, as a rule, loses the first money, and “later” comes - time to think about the reasons for the mistakes.

In contrast, any professional trader has a clear trading plan. Any book, podcast or interview with famous managers is clear evidence of this (excellent materials on this topic are collected in Jack Schwager’s books “Market Wizards” and “New Market Wizards”).

Let's look at each element of the trading plan in more detail.

Point 1. Is it possible to trade on the market now?

The first point of the trading plan is the answer to the question “Is it possible to trade in the market now?”

It allows you to understand whether it makes sense to analyze a given financial instrument. If you cannot trade in the market, then determining entry points, observing smaller time frames, relevant news flows, or calculating position size is pointless - it is a waste of time.

This can happen when there is no directional trend in the market, or it is developing very actively, and it is too late to open a position. When the market fluctuates in a triangle or flat, it is not advisable to trade (if you are just starting to study trading in the market and see a triangle or flat, you cannot trade). Below is a video about why you should not trade in flats and triangles:

Quite often situations arise when trading on the market is impossible. It is better to wait than to enter the market simply because the trading terminal is already open and some time has been spent analyzing the market situation.

The first point of the trading plan should give a clear answer to the question: is it possible to trade now? Ignoring it is paid for by your resources, namely:

• time - the trader analyzes in detail instruments that are not worthy of attention in principle;
• money - if the market is not suitable for trading now, the likelihood of getting a negative result increases.

Point 2. In what direction should the trade be conducted?

If the first point of the trading plan is fulfilled and it is possible to trade on the market, then the next question arises - in which direction should you trade, what trend dominates the market - bullish or bearish?

Price patterns allow you to determine the direction of the trend in any market and time frame in a few seconds.

Point 3. How to correctly determine the entry point into the market?

The third point of the trading plan involves answering the question: at what point should a position be opened? What exactly needs to happen for a noteworthy signal to appear?

The principles of determining market entry points and trading tactics are a reflection of your vision of the trading process in the market. You can search for an entry point on one timeframe or use data from several; you can use volumes, price and option levels, etc. Each trader gradually accumulates a set of signals and methods of market analysis that are worthy of trust and allow one to clearly define the principles of entering and exiting the market.

Why prescribe rules for entering the market? This allows you to discipline yourself and trade in accordance with the set of rules that are specified in the trading plan and, in your opinion, are worthy of attention.

In directed trading, there are two main principles for finding market entry points:

• — searching for an entry point at the time of the most likely completion of the market correction
• — search for an entry point at the moment of a confident update of the next maximum, entry in the middle of an impulse wave

Over the past 100 years, directional trading on time frames from Daily to M1 has spawned thousands of new names for these trading tactics. They often contain some kind of surname or inappropriate words “secret” or “author’s”. Nevertheless, the basic principles as the basis for searching for entry points into the market do not change - these are a breakout, a rebound, and their combinations.

Points 4 and 5. How to limit risks and define a goal? How to determine the optimal position size?

The fourth and fifth points of the trading plan are combined for a reason.

These are the rules of capital and risk management, money management and risk management. They include calculating the optimal position size for entering the market and principles for determining the profit potential and risks in each transaction (reward to risk ratio).

Ignoring these principles in the long term leads to a guaranteed loss of funds in the market.

I have been lucky enough to work in trading-related companies and communicate with traders since 2007. During this time, I came to the conclusion that most traders lose money because they ignore the rules of money and risk management (usually this happens due to).

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Focus on risk management. Make it your top trading priority.

Paul Tudor Jones - founder of the hedge fund Tudor Investment Corporation

Most traders lose money in the market, and most traders do not follow money and risk management rules. These are interrelated statements. If you analyze the actions of novice traders, you will see that most often in their trading plan there are no points 4 and 5, or the trader does not follow them (it is enough to open a position with an extremely high volume just once or not limit the risks with a stop order to destroy the fruits of his painstaking labor - trade statistics and/or capital).

Money management is the principle of determining a certain position volume in certain percentages of capital. Risk management is the ratio of profit potential to risks. Money management and risk management are the two most important points of a trading plan, but most traders ignore them or do not realize their importance.

Instead, traders' minds are often occupied with finding the ideal trading concept that will allow them to enter and exit the market at turning points. This is the search for the so-called “trading grail”.

I would like to point out that the “Grail” exists, and it consists of following a trading plan and the rules of capital and risk management. Below is a video dedicated to the key rules of risk management and their impact on trading performance.

It is almost impossible to destroy a trading account following the rules of money and risk management, even if you really want to. If (not in dollars or contracts) and does not exceed 1-2% per trade, and the average profit-to-risk ratio in each transaction is 2:1 or higher, destroying a trading account will become an extremely difficult task.

Is this hard to believe? Try to open a training (!) trading account and try to “reset” it using the parameters described above. You will get tired much faster than the account will be destroyed, even if the direction of entry into the market is chosen using the absurd principle of coins, heads and tails. This will make it clear that the profit/risk ratio and proper calculation of the transaction volume are more important than the rules according to which you enter the market.

Below is a video about how possible it is to destroy a trading account, following the rules of risk-management and money-management.

Professional traders pay special attention to risk management and money management. This is the basis of trading. If you look at the statistics of traders who lose money in the market, you will see the mirror opposite picture - these rules are ignored, while special attention is paid to the first three points of the trading plan (or one of them, most often). In search of the “Grail,” a trader is often inclined to believe that the most important thing in trading the market is to find the ideal entry point, and managing capital and risks is not at all necessary. And I am confident that this view has destroyed more trading accounts than forex brokers who do not take clients' trades to the real market.

The most important thing in trading the market is not to find the ideal entry point, but to trade following the rules of money and risk management. If you are just starting to study the financial markets and accept this as a fact, you will save a lot of time and money.

An example of a trading plan for medium-term market trading

Information noise

The more sources of information surround us, the greater the risk of the negative impact of information noise on trading results. A trading plan is an effective way to combat this problem. Let's look at a small example.

Let's say you have opened a bullish position in the US dollar market. An hour after this, you read an analytical review, the author of which colorfully describes 10 reasons for the imminent cessation of the existence of this currency.

You agree with many arguments and begin to worry. The question arises, is it necessary to close the position? The answer is no.

If your trading plan is drawn up correctly, then you have written down signals for entering and exiting the market. It is unlikely that such signals will include exiting the market after reading Twitter or Facebook feeds.

Third, do not forget that often the authors of analytical reviews write them due to an accepted obligation to write something (this is a job). As a result, the author may be glad not to write about the dollar today, but it is necessary - the topic is popular, something needs to be written, and the negative always attracts more attention than the positive.

Fourthly, the more actively the market grows, the more pessimists there will be in the market - the crowd is more often mistaken than acting correctly. Just look at the ratio of short to long positions among retail brokers. Often in a bull market, when the price makes new highs month after month, there will be more open sell positions than buy positions.

Rice. 1. Private traders are selling the New Zealand dollar in a long-growing market. Transaction statistics – Oanda

Private traders act like, absurd? No, the crowd just acts emotionally, most traders do not have a trading plan, and the average risk in each trade exceeds the profit (sometimes several times). In addition, private traders more often average in an attempt to guess the market turning point than trade the trend like professional speculators.

Emotional trading– one of the factors that has a negative impact on a trader’s trading results. As a rule, numerous uncontrollable emotions are the main reason why a trader makes a large number of mistakes in the Forex market. Precisely, trading psychology is a factor that is underestimated by many novice traders.

Entering the market based on emotions, the desire to win back a loss immediately, instinctively opening a trade deal when the price of an asset moves sharply and quickly, overtrading - this is not a complete list of erroneous decisions that arise in a situation of stress, under the influence of emotions.Having a trading plan in the Forex market will help the trader to largely avoid the influence of these factors. It is the trading plan in the Forex market and, most importantly, strict adherence to it that is the basis for the successful work of many traders. In essence, a trading plan in the Forex market is a complete instruction for working in the market for a certain time interval (daily, weekly).

Requirements for a trading plan and what it includes

A trader must draw up a trading plan only in writing. There should not be any “mental plans” or plans written down on pieces of paper. You should develop the most serious approach to planning your trading activities.

A trading plan should be drawn up exclusively before the start of trading and for a specific period of time. Drawing up a trading plan in the Forex market is carried out on the basis of a comprehensive analysis of the market for a certain time period using data from fundamental and technical analysis.

The Forex trading plan includes:

Selection and list of financial instruments that you plan to trade on the market

Clear definition of signals for entering and exiting a trading position

Justification for setting and calculating the level of limit orders

Significant reasons to change your trading plan

Analysis of transactions, both individually and all transactions for the day. Identification and analysis of mistakes made, and determination of actions to eliminate them.

After completing each transaction, the trader needs to conduct a comprehensive analysis of it: the correctness of entering and exiting the transaction, the result obtained. It is also necessary to note and record all thoughts and emotions that arise during the trading process, identify the positive and negative aspects of the trading process, and note the negative aspects that still need to be worked on further. It should also be remembered that the situation on the Forex market almost always changes quickly and dramatically and the movement of most currency pairs is characterized by high volatility, especially when important economic news is released or speeches by the governors of the world's leading central banks. In this situation, the trading plan can be partially revised in accordance with the changed market conditions and another plan can be drawn up, in accordance with which the trader needs to work.

It is also extremely important to know that even the ideal forex trading plan It will not help you if you do not comply with all its provisions. In this regard, the trader’s personal discipline is extremely important, without which it is almost impossible to achieve success.

A trader’s trading plan is the definition of trading goals and ways to achieve them by the trader, through planned and developed programs of action in the financial market.

A Forex trader’s trading plan differs from a trading algorithm in that it has global goals, taking into account all possible factors that matter in making money on the exchange. In a trading algorithm, you can use and detail your trading in the greatest possible way.

A trading plan is the first piece of documentation every new market trader should create if you want to succeed and not lose yours. Other important and more detailed documents are: the trading algorithm and the trader’s diary. We do not know of a single trader who, without these three documents, would have achieved outstanding results in the foreign exchange market.

A trader’s trading plan is somewhat reminiscent of a business plan, which is familiar to all people who have ever created their own business. Is it possible to do without it? Yes, you can, but how long will your own business last if you don’t calculate all the possible risks and take measures to minimize them? Probably not for long. No bank or investor will give a loan for a business without a business plan.

6 Component Sections of a Sample Trading Plan

A well thought out and documented Forex trader trading plan is your road map to profitability. What does this card consist of? A sample trader’s trading plan must necessarily consist of the following six points:

1. Identify yourself as a trader.
   Types of traders: scalper, intraday trader, swing trader, long-term investor.
2. Decide on a financial instrument to trade
   Financial instruments are: currency, metal, CFD contract, etc.
3. Set clear, achievable, measurable goals for yourself.
4. Assess your risk and possible profit.
5. Create and follow a clear set of rules.
6. As time passes, consistently adjust your capabilities.

You must approach each of the above points seriously and responsibly if you want to become a successful trader. If you feel sorry for your time and have no patience, quit trading, because you will lose all your money very quickly.

10 Questions to Ask Your Trader's Trading Plan

The first thing you need to do is take a piece of paper and your favorite pen, marker or pencil. We recommend that you write your personal sample Forex trader trading plan in your own hand because it forces you to think as you go. This way you will not copy other people's trading plans and will remember every considered point.

The trading plan must fit on one sheet. These will be your trader's commandments, if you so choose. Your trading bible. Now let's turn our attention to the most important issues that will determine your behavior in the Forex financial market.

Your sample Forex trader trading plan must answer the following 10 questions:

1. What realistic goals do I set for myself?
   Take into account: experienced(!) traders increase their trading capital by up to 20% per month.
2. What type of trader am I?
   You could be a swing trader, for example.
3. What financial instrument do I trade?
   Focus your attention on one currency pair and become an expert on that currency pair, for example it could be USD/JPY; you can trade 90% of the time with one currency pair, and we recommend spending the remaining 10% experimenting with another financial instrument, for example XAU/USD.
4. Which one (yes, one) trading setup will I execute expertly?
   For example, you enter a bearish trade on the USD/JPY pair when the trend has been downward for three days; this is the only formation you should trade.
5. What is the stop loss and take profit level for each executed trade?
   For example, the critical stop loss level in each trade is 30 points, but most often it is 20 points; The profitability ratio in each transaction is 1:3, i.e. take profit in each transaction will be 60-90 points, depending on the risk.
6. How much volume will I trade?
   The volume depends on the trader's trading deposit and the leverage provided by the broker; for example, the amount of money you risk on each trade should not be more than 2% of your entire trading deposit; From this calculation, the possible volume of the transaction should be determined.
7. How much money should I have in my trading account?
   For example, you have free $500, on which your life and the life of your family do not depend; it could be $100 or several thousand dollars - everything is individual.
8. What are my top 3-5 rules that I will follow closely?
   For example, I undertake not to open trades during the release of economic news, or I do not open trades on Monday mornings and Friday evenings, or I open a trade when 3 candles in a row confirm my forecast for the movement of the currency pair, etc.
9. When should I review my trading plan?
   For example, you should review a trader’s trading plan at least once every 3 months or, if your profitability does not satisfy you, as necessary.
10. What actions will I take to educate myself and improve my trading skills?
    For example, you have problems with discipline, the solution: you must re-read the Forex trader’s trading plan every day and calculate how much money you lost due to your hasty actions, which contradict what you yourself wrote.

Have you mastered it? Now let's summarize a short summary that will help you create an optimal trading plan.

Do you want to invest money in yourself?

You have received a precious sample of a Forex trader's trading plan. This gives you a big advantage over other new traders. Please note that not everyone who reads this article will take the advice to create their own trading plan. All these factors already make those traders special who strictly follow the creation of a Forex trading plan.

How can you determine how well you have created a trading plan if you have not yet started trading? This is quite simple to do - you should look at your sample trader trading plan from the investor's side. If you have read your trading plan and are ready to invest money in yourself, then the plan is drawn up correctly. If, after reading the trading plan, you consider everything written to be not very reliable, then there is still something to work on.

You must understand that a Forex trader's trading plan is not the holy grail and will not immediately make you a successful and experienced trader, but without it you certainly will not become what you want to become.

Don't delay and write your sample trader trading plan as soon as possible. You want to start earning money as early as possible?!

The stock market can hardly be called a bastion of stability. Buying and selling securities is a rather risky activity, because real money is at stake. The human factor also plays a big role in this, since trading participants are traders who are susceptible to emotions, as a result of which they make many mistakes.

To minimize risks and try to reduce the number of mistakes, successful traders draw up a trading plan, which they then strictly adhere to during their work. The trader’s trading plan not only ensures stable trading, but also allows you to obtain the necessary statistical data and make adjustments if difficulties arise in your work.
You can compile it both in paper and electronic form, based on your own ideas or using existing examples.

A correctly drawn up trading plan for a trader is based on 5 main components.

1. Determination of the market, time frame and traded financial

The first step is to select the most favorable financial environment for trading, i.e. the market on which trading will take place. This can be not only Russian, but also European, Asian or American markets. The latter is characterized by the highest trading volume, transparency and high profitability, and therefore is often recommended as the most promising.

Then you will need to decide on financial instruments. These include: stocks, bonds, options, etc.

Transactions with each type of securities have their own specifics. For example, stocks and bonds are the most risky, while stocks and bonds are more stable. The timeframe also plays a separate and extremely important role. You must clearly understand the possibility of combining trading with other types of employment; time allocated for trading; degree of activity; decision-making interval that is optimal for you. It comes from the choice of timeframe.

A significant portion of novice traders prefer swing or day trading. But the process of making trades on time frames of 1 minute, of course, requires more activity than on time frames of 1-4 hours. Decide in advance whether you plan to actively trade on one- and five- to ten-minute charts or choose medium-term trading based on daily and weekly charts.

A significant percentage of experts believe that this is necessary, but the final decision depends on which style or strategy was chosen.

2. Risk limitation and capital management

Even professional traders cannot trade without making a single mistake - losing positions or even a series of losses is an integral part of being a trader. That is why, in order not to lose everything in one day or in one transaction, it is necessary to determine acceptable loss limits both for each of the transactions and for certain periods - day, month, etc. Professionals know how to hold a position for a long time, while planning both profits and possible losses for several weeks and even months in advance.

• the risk per position should not exceed 1% of the total amount available on the account;
• it is necessary to set the basic position size in relation to the acceptable risk;
• it is necessary to determine the possibility and admissibility of simultaneous opening of several positions, the size of each of them and the degree of their interrelation.

If you have enough trading experience, you can open more than one position, but it is worth remembering: there should be as little interaction between them as possible. Otherwise, if there is an unfavorable price movement, both trades will result in losses.

It is also worth determining an action plan when certain limits are reached, for example, after reaching the daily limit, stop trading until the next day.

3. Determining specific signals for entering a position

The moment of entering a transaction should be determined and indicated in as much detail as possible. At this stage, the trader is required to make a prompt decision, without unnecessary thinking, so it is extremely important to set specific signals for opening a transaction. Often they use specialized indicators, overcoming a certain price threshold, technical analysis figures or the premises of fundamental factors - it all depends on the specific trading strategy.

Signals from a specific strategy should be combined with general parameters of market movements in order to increase their effectiveness. Therefore, it is important to develop a number of additional criteria, which may include an increase in volume, the formation of graphic figures, and the presence of a trend. This set is set depending on the overall chosen strategy and trading style. It is also necessary to first determine the types of orders used that will be used to open positions. They can be either limit or regular market. You can practice using them using a demo account.

4. Determining the main conditions for closing transactions

Undoubtedly, the entry point is of great importance, but the correct definition of exit criteria also plays an even more important role. Moreover, these criteria should be applicable not only in conditions of a profitable transaction, but also especially for a losing transaction.

To fix a loss in a timely manner, stop loss orders are used - in this case, the transaction is closed automatically, at the moment when the set price level is reached. The situation with closing successful transactions is somewhat more complicated, since it is more difficult to do this psychologically. But when delaying the closure, you need to remember the possibility of missing a reversal or becoming a victim of a correctional wave.

To close a profitable trade, use a floating stop loss or fix a take profit position when the target profit is received. It can be calculated using the P/E ratio (risk to reward ratio). Another option is to close the position at the moment when the conditions that were the basis for opening completely reverse.

5. Job statistics

Statistics of trading activity are carried out through a detailed description of all processes - entry and exit of transactions, reasons for opening and other factors. To do this, a professional exchange player maintains a separate one, in which all indicators are recorded.

Summary statistics allow you to determine the most profitable/unprofitable trading patterns, instruments, and even time periods or specific days. Overall, this provides the opportunity to customize and adapt a trading plan to market factors or to timely identify changes in the market.

Trader's trading plan. Results

Everything mentioned above is extremely important, because when put together it forms the overall system of professional stock trading. The care with which a trader’s trading plan is thought out and developed is a guarantee of the convenience of the trading process itself and its effectiveness.

Those who manage to achieve a good income in most cases work strictly according to a trading plan and keep detailed statistics, which allows them to track potentials and shortcomings in an individual case. Regular income in two thirds of transactions, received month after month, is a sign of a true professional in this field.

When trading stock markets, market volatility must be taken into account. It is important to demonstrate the ability to adapt to new conditions. A trader’s trading plan will undoubtedly help with this.
As work progresses, the existing system may require adjustments, but in any case, it will be based on the basic principles described.

A correctly drawn up plan is already half the battle; the main thing is to correctly identify all strategic tasks at the initial stage of planning, and then describe the sequence of their solution.

Many novice traders make the mistake of thinking that the Forex work plan concerns only the trading process itself, namely, conducting trend analysis and carrying out transactions in the trading terminal.

Forex plan - will include setting goals, determining ways to solve them and, of course, the practical part of trading.

Target.

In our case, the goal determines the entire further strategy. If you want to make Forex your main source of income, then your approach to planning should be completely different.

For example, in order to simply earn a little extra money, it is enough to have a couple of thousand dollars and open one trade every few days.

In the same case, if you want to live on what you earn on the stock exchange, the income requirements are already increasing sharply, and if you do not have the opportunity to use a large starting capital for Forex, you will have to resort to riskier trading strategies.

And so, at this stage the main thing is to decide what you want, but this should be done taking into account real possibilities. Unrealistic goals are almost always doomed to failure.
For example, such a task as earning 1000 dollars a month, having only 100 in your pocket, will most likely end with you losing the first 100.

Therefore, earning $10 from $100 will be more realistic to complete the task.

Choice of strategy.

After setting the task, we move on to choosing a trading strategy for its implementation. The more ambitious your goal, the more risky the strategy you will have to choose. You can get acquainted with various trading strategies in the section of the same name "Forex Strategies"

Planning the trading process.

Typically this stage consists of the following elements:

1. Analysis of the current market situation.
2. Drawing conclusions on the most favorable places to enter the market and the size of stop orders.
3. Determining the size of the lot, and the amount of which you are currently willing to risk; the more confident you are in your forecast, the greater the ratio of the transaction volume to the trader’s deposit can be.
4. Receiving entry signals and directly opening the transaction itself.
5. Control of an open order, its modification (transfer