FOREX Trading Plan Overview

I assume you have a handle on mechanics from working your demo accounts and have at least tentatively selected a broker-platform pair to use for trading -- but not yet real money! This collection of articles provides a plan to get fully organized to take the next step, practice trading.

FOREX trading is a fast-paced enterprise. You need to make decisions quickly, react instinctively, and not drop any of the multiple balls in the air. Leverage is one of the primary reasons traders are attracted to currency trading.
It also magnifies mistakes because decisions need to be made quickly.

The plan is all about monitoring the market process and keeping track of it vis-à-vis your own trading approach. Every trader will want to have a simple plan encompassing all aspects of his trading program. It does not need to be complicated. In fact, it should not be complicated so it does not distract or take up too much time.

Tip: Counterpoint -- Be careful that the process tail does not wag the trading dog. Most of your time must be devoted to watching and analyzing the markets.

Your own trading plan must be well laid out, thought out, all encompassing -- and effective. And, you must abide by it consistently.

In FOREX: Setting Up Shop. I detail a basic FOREX trading plan and how it works for me in real-time trading. You certainly want to modify it and customize it to your own needs, skills, experience, and techniques.

Tip: Keep It Simple!

For the pre-trade plan, you will use: the biofeedback form, session lines profile, watch profile, and pre-trade checklist.

For the trade plan, you will use: the watch profile, tracking log, and 30-trade campaign log.

For the post-trade plan, you will use: the continuation chart, session line profile, 30-trade campaign log, trade diary, and biofeedback form.

If this seems like overkill to you at this time, I advise you to at least try the full set of process materials at the beginning. If some seem superfluous to your trading method and space, discard them.

Even a bad plan is better than no plan at all. At least a bad plan can be improved, and made into a good plan. Keep it simple. Do not commit yourself to doing things you will not do consistently. I have seen traders with such long and involved plans and processes that I wondered when they find the time to actually trade!

Do not be discouraged if your first 10 -- or even 30 trades -- fail to match your expectations. The FOREX race often goes to the steady, not the swift. Stay the course. If you conclude it is necessary to make adjustments -- to your trading method or money management -- consider them carefully before making the changes. What are
By Michael Duane Archer
Michael Duane Archer has been an active futures and FOREX trader for more than 35 years. He has worked in various advisory capacities, notably as a commodity trading advisor, registered SEC investment advisor, and branch manager for Heinold of Hawaii. He currently trades FOREX and futures and is involved in several technical analysis research projects.

Copyrighted 2020. Content published with author's permission.

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