Before we start:
All Traders should have a mantra, as follows:
I will educate myself on how the market works.
I will learn how to find and place a trade.
I will create a trading plan and trade my plan.
I will not chase the market with emotions.
I will decide to be a day trader or an overnight trader (or longer) before I enter the market to help to control my emotions.
I will be patient and wait for a market set up.
I will never trade without a protective stop loss order.
The market will meet my criteria or I will not trade.
have refined a standard procedure that I use for the process of creating a trading strategy. I always start with the big picture and make increasingly more detailed decisions about the strategy.
I begin with the assessment of what type market action I want to trade and what kind of trader I am. Then I end up with making decisions on exits, and how far away to put my money management stops.
How can you adapt my strategy making to your personal psychology?
You Must Pick the Market
The first decision you must Avatrade Trustpilot reviews make is what type of market you want to trade. Although this may look like an easy decision, in fact, it is a difficult judgment, because most new traders only consider the profit aspect. They simply try to pick the strategy that they think will make the most money. Focusing on money will probably lead you to make the wrong decision. It is the psychological aspect of trading each of the markets that is the most important consideration. It does not make sense to create a very profitable strategy if you are unable to trade psychologically.
What is Your Trading Time Frame?
You need to decide whether you will day trade or trade on daily or weekly charts. It is very difficult to have a job and trade intra-day. It is not totally impossible, just very difficult.
Most people want to trade part time and still hold down a day job. If you want to do this, it is better to trade daily or weekly charts. You will only be able to look at the market outside of your working hours and your strategy design will have to take this into account.
The strategy should not require you to check the market during the day. I think that there is only a certain amount of money that you can get from the markets and that depends on the time frame you choose to trade.