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LESSON: Example of Some Rules You May Have in Your Plan

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[op_liveeditor_element data-style=””][text_block style=”style_1.png” align=”left” font_size=”16″ font_font=”Montserrat” font_color=”%237e7e7e”]Your trading plan is crucial and at the end of this course you should be sitting down and very carefully looking at the student trading plan example and creating your own with your own rules.

The Advanced Course Has Key Information – Including Banking

Whilst you are not ready for many of the strategies in the advanced course as yet, you will find I do discuss a lot of things when you come to it, that will at a later stage help you with things such as trade management, managing different markets and creating trade management rules for your plan etc,.

As you start to move through your charts and hunt trades, the things you need to consider for your rules and trading plan are…

• I will only trade weekly and daily setups
• I will only trade Pin Bars and Engulfing Bars
• I will only risk X amount of dollars or x % of my account
• All entries will only be taken at the break
• All stops will be placed the other side of the price action bar
• I will manage all trades according to my plan which is…
• My Rules for Pin Bars are…
• My rules for Engulfing Bars are…
• I never trade against the trend
• I never trade in ranging markets or I only trade in ranging markets when…

These are just a few of the rules you may begin your trading plan with. The more detailed the plan is the more you the trader will benefit.

Every situation should be covered. This can be hard to do all at once, but over time as you find where the gaps are, ensure you fill your plan in so that the next time you need to refer back to it, it is up to date and correct.

Remember the goal is to be a consistently profitable trader and the only way we can achieve that is by behaving consistently given the similar circumstances that the market presents to us over and over again.

Why I am FANATICAL About Rules!

You will note that I am strict with rules and how I carry them out and the reason is because; traders are fantastic at creating trading plans. That get so excited and they create all of these rules on top of rules.

Then time comes for crunch…. they don’t want to miss out on what could be a really big winner, because the pin bar has not closed back inside the previous candle by 2 pips, or the engulfing bar is not actually engulfing by 3 pips, but if you squint or zoom the chart out it looks like it is engulfing.

The so called or almost pin bar is great setup, other than for the fact it’s not.

The trader says the famous words “just this one time”… and that is where it begins and the whole trading method and edge ENDS.

Where is the cutoff? Where exactly does it end? Next time it will be 5 pips and 10. Next time the nose of the pin will be half and half.

The edge is created from the RULES you create in your plan, but if you don’t enforce them with the strictest discipline, then they are useless.[/text_block][/op_liveeditor_element]