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In our last lesson we finished up our discussion the different styles of trading with a look at the longer term style of position trading. In today’s lesson we are going to start a new discussion on one of the trader’s most powerful tools, the trading journal.
As I think most people who are successful at anything will tell you, a major factor that separates the successful from the unsuccessful is those who are successful look at each experience as a chance to learn and grow where those who are not move from one experience to another without learning much at all. With this in mind one of the major things that separates the profitable trader from the unprofitable trader is an openness to learning from each trade, and a willingness to put in the effort it takes to document and periodically review each trade that is made.
Traders who document their trades do so in trading journals. This can be as simple as writing down certain details of your trades in a notebook or in a word document, however those who know a bit about excel normally find this a much more powerful option
Below are 10 things that in my opinion it is important to document about each trade. :
1. The general market conditions for that specific trading day. For example is there a lot of volatility in the market, is the market trading lower or higher, ranging or trending?
2. Why you entered the trade, the time you entered the trade, and the price you entered the trade.
3. Why you exited the trade, the time you exited the trade, and the price you excited the trade.
4. Whether the trade was a long or short trade.
5. What happened with the market from the time you opened the trade to the time that you closed the trade.
6. The money management parameters you used in the trade and which we covered in our previous lessons on the subject.
7. Many traders will also attach a chart with their analysis on it to help them remember the trade when they review their trading journal.
8. Where you were weak that particular day and what you are going to do to address those weaknesses.
9. Where you were strong that day and what you are going to do to address those strengths.
10. Any other thoughts that you had that day which should be noted.
http://www.informedtrades.com/20418-10-components-successful-trading-journal.html
That’s our lesson for today. In tomorrow’s lesson we will look at the next and equally important step of how to go about reviewing your trading journal periodically in order to make sure that you leverage your journal to improve your trading.
Forex Position Trading Journals, 75. How to Keep a Trading Journal.
The Foreign Exchange Trading Placement Strategy
Over the in 2019 and also a fifty percent, there have actually been some terrific trends, the majority of noticeably brief JPY first, and after that the recent long USD fad. In these problems, a lot of investors begin to wonder why they are not making the sort of professions where champions are delegated compete weeks and even months, collecting thousands of pips in earnings at the same time. This kind of long-term trading is referred to as “placement” trading. Investors that are used to shorter-term trades tend to locate this design of trading a fantastic obstacle. That is an embarassment, since it typically the most convenient and also most rewarding sort of trading that is available to retail Forex traders. Right here I’ll lay out an approach with rather basic regulations that simply makes use of a couple of indications that you can use to attempt to catch as well as hold the strongest, lengthiest Forex trends.
Pick the Acquiring Currencies to Trade
Choose the Currencies to Profession. You require to locate which money have actually been gaining over current months, and also which have been falling. A great duration to utilize for dimension has to do with 3 months, as well as if this is in the same direction as the longer-term pattern such as 6 months, that is great. One basic way to do this is established a 12 duration RSI and also scan the weekly graphes of the 28 largest money sets each weekend. By keeping in mind which money are above or listed below 50 in all or almost all of their sets as well as crosses, you can get a concept of which pairs you should be trading during the coming week. The suggestion, generally, is “get what’s currently been increasing, market what’s already been decreasing”. It is counter-intuitive, however it functions.
How Many Currency Pairs to Profession?
You must currently have between one and four money sets to trade. You do not need to attempt to trade way too many pairs.
Establish Graphes for all Time Frames
Establish graphes on D1, H4, H1, M30, M15, M5 and M1 time frames. Install the 10 duration RSI, the 5 period EMA and also the 10 duration SMA. You are seeking to go into trades in the direction of the pattern when these signs align parallel as that trend on ALL DURATIONS throughout active market hrs. That implies the RSI being above the 50 degree for longs or below that level for shorts. Regarding the relocating standards, for the majority of sets, this would be from 8am to 5pm London time. If both currencies are North American, you might expand this to 5pm New york city time. If both currencies are Oriental, you might likewise seek trades during the Tokyo session.
Decide Account Portion to Risk on each Trade
Choose what portion of your account you are mosting likely to run the risk of on each trade. Normally it is best to run the risk of less than 1%. Calculate the money amount you will risk as well as separate it by the Ordinary True Variety of the last 20 days of the pair you will trade. This is how much you should risk per pip. Maintain it consistent.
20 Day Average Real Array Away
Get in the profession according to 3), as well as put a tough stop loss on 20 day Ordinary Real Array Far from your entry cost. Now you must patiently enjoy and wait.
Positive-Looking CandleStick Pattern in the Desired Direction
If the profession moves versus you promptly by about 40 pips and shows no signs of coming back, departure by hand. If this does not take place, wait a few hours, as well as check once more at the end of the trading day. If the profession is showing a loss currently, and is not making a positive-looking candlestick pattern in the preferred instructions, then leave the profession by hand.
Retrace Back to Your Entrance Point
If the profession is in your favour at the end of the day, then view and wait on it to backtrack back to your entry factor. If it does not recover once again within a few hrs of reaching your access point, leave the trade by hand.
Profession Degree of Profit Dual to Tough Stop Loss
This should proceed until either your profession gets to a degree of profit dual your tough stop loss. Now, move the quit to recover cost.
Move the Stop-Up under Support or Resistance
As the profession moves increasingly more in your favour, move the block under support or resistance as appropriate to the instructions of your trade. At some point you will certainly be quit out, yet in a good fad the profession ought to make thousands or at least hundreds of pips.
You can personalize this strategy a little according to your choices. Nevertheless, whatever you do, you will certainly shed a lot of the professions, and also you will certainly experience extended periods where there are no trades which is uninteresting or where every trade is a loss or breaks even. There will be aggravating moments as well as challenging periods. However, you are bound to make money over time if you follow this sort of trading strategy, due to the fact that it complies with the classic principles of robust, effective trading:
Cut your shedding trades short.
Let your winning trades run.
Never ever run the risk of excessive on a solitary trade.
Size your placements according to the volatility of what you are trading.
Trade with the trend.
Don’t fret about catching the first segment of a pattern, or its last. It is the component in the center that is both safe as well as rewarding enough.
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