Do you need a plan?
A Forex Business Plan is imperative to trading success.
Have you ever asked a business owner why they have a business plan? I bet not. First of all it seems pretty obvious why one is needed to run a company doesn't it.
Well, why then do so few traders have a Forex Business Plan? The short answer is that most traders are not successful. This is reason enough to do what most are not doing isn't it?
When we start our trading journey we want the freedom it can provide, also the accelerated income stream. These are the things we desire and adding another form of work seems counter intuitive to the end goal. So why would you choose this extra step?
What you need to plan for
When you are actively trading, there are times when emotions get in the way of the best decision. Having a plan that covers all of the "what if" scenarios can be a game changer for your consistency.
For example; what if i win my next 10 trades in a row and start feeling over confident? Should I up my risk percentage or keep it the same? Or what is my plan for (x) number of consecutive losses? Do I use less risk or go onto a demo account? And what are my parameters for acceptable variability in my wins and losses (how many losses in a row is normal)? These are the types of questions we need to be asking ourselves, writing down the answer an reviewing at the beginning of every trading week.
Points of your trading business plan
Writing your Plan
Now we have all the points that need to be covered it is time to start creating your document. Copy the headings above and just start writing a point form list under each heading... don't be too concerned with quality right, now just focus on quantity of points. Once you have your extended lists, go through each one and refine and combine the items to form a distilled high quality list. It may take going through it a few times to get it right but that's ok, this is an ongoing process. If you are looking for our detailed video and template, it is available in our step by step Forex Trading Course.
Now you have your plan.. what next?
Having the plan is great of course but all to often these documents get tossed to the side and only followed for brief periods of time. So it seems like we need to create a plan to follow the plan, furthermore that has to be in the plan...hahaha... sorry had to put that in there. But seriously, you need to have a routine for review of not only your chart analysis but also your business plan to make sure you are keeping up with it and diligently following along.
If you have questions on any of this, please make sure and get in touch. I am always happy to help!