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Thread: Consistency for your trading plan

  1. #1
    Trader ara's Avatar
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    Consistency for your trading plan

    I put this thread here because it is part of Beginners guide. You find a lot of materials in this forum related to forex trading, of course it can be a library for you to learn more and more. I'm sure nothing is useless here, but if you think so then just absorb what is useful, discard what is useless and add what is specifically your own. It's so simple.

    As long as the market moves up and down, then it's fruit for you. How did it happen? Of course you should be able to DANCE IN THE MARKET. What the??? How to?? YES..., TRUST ME.., You can DANCE..., although you can't dance in the market, trust me you can dance ballet, tango, samba, or belly dance, or something else. But, really very surprising why in the world of forex trading where the comparison of win and lose is 50:50 almost 90% of people in it always fail. Though only need to determine buy or sell when will enter into trading position. Why it happened there was one thing in common between these people. Ie inconsistent in carrying out trading systems and unplanned trading activities.

    All things unplanned will lead to chaos in this case margin call or stop out. Not having money management in trading causes the trader to become a true gambler. A good trading plan will make our account can continuously survive and growth, we will also be able to read and also analyze the location of the error of our trading techniques. Without any trading plan we will not be able to make improvements to the trading system and the perfection of the trading system that we used will never be achieved.

    Examples of cases one form of improvement of trading system:
    There is a trader. After 10 trading days turns out the system that he uses is always lost. Though he always apply his trading plan in a disciplined and consistent. But the resulting consistent instead lose.

    If there is a case like this, if his trading didn't noted it will be difficult to evaluation or improvement. Maybe even he will change the trading system he uses with other trading systems. And when he realizes he has found a very good trading system. And when he realizes that in fact he has used a very good trading system.

    What the? why good ?? someone must be wondering. Is not the system he used always lose? Of course all trading systems have advantages and disadvantages, I can't remember how many times I say this in this forum, which obviously I often say this. That's why we should find and learn the advantages and disadvantages of our trading system, having a trading journal is a way to develop a trading system that we use, you should do a forward test to get a data of your trading history by using your trading system and evaluate it, do it again and again till you can make your trading system become profitable. Or at least, we can do back test if we are lazy to do forward test.

    Development of a trading system by a trader can only be done because he is consistent with the system he uses so he can make improvements to the system he has.

    Trading is a matter of probability but many beginner and middle-class traders do not have consistency in their trading system. In this thread I will first emphasize on the consistency of usage of trading techniques. Consistent I mean here is not changing the trading system used. But beginner traders often ignore this, when he trades with 1 technique when he suffers a successive loss and then he will change to another trading system.

    For example, let's say we already have backtest or forward test data for our trading strategy. So we know that the wining rate of our trading strategy is 70%. (How to do a proper back test/ forward test? just find it here.)

    Then he do a real trading, the result is: (let's say the result in his real trading is same with the data of test)

    1st trade : Profit
    2nd trade : Profit
    3rd trade : Loss
    4th trade : Loss
    5th trade : Loss

    (in this condition usually beginner traders will start "upset" and change this trading strategy to other trading strategy)

    So he will back to zero again and again, changing and changing again his trading strategy. He stuck on this phase for years.

    Conditions will be different if he is consistent in his trading strategy. let's say that he didn't change his trading strategy to other strategies.

    6th trade : Profit
    7th trade : Profit
    8th trade : Profit
    9th trade : Profit
    10th trade : Profit

    This is because the probability of the system is not so on win. Or even in 100 trading times, it could be the first 30 trades will be loss and the next 70 trading times will win.

    Well, so that our margin is able to withstand loss until 30 times, this is needed a risk management, this is where the importance we make a trading plan. You can also read about it here.

    "I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times."
    – Bruce Lee

    Those quote can inspire us that learning and practiced 1 strategy for a long time is very powerful compared to learning and practiced 10,000 strategies once. Well, for beginners please try to start consistent on your system and make your trading plan. Focusing on developing your trading strategy, learning a strategy longer is the best way, don't learn a lot of strategies at one time or change trading strategies too quickly, forget about finding perfection in a never-losing way of trading or holygrail. Consistent with "profits bigger or more than loss" is enough.
    If you can apply this then you will have the chance to survive and growth in Forex trading world.

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    Last edited by ara; 07-16-2018 at 08:18 AM. Reason: change some words

  2. #241
    Trader Sascha's Avatar
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    Quote Originally Posted by naeem555 View Post
    plans will tell us what to do and how to do actually because if we have good plans if we know about market we can really make some sensible and good orders, so never trade without proper learning, if we do not have proper experience we can lose, if we do not have proper learning steps we can not survive for long, so any way can be better if we learn it fully, so learn first then think about earning
    we're the one who creates our trading plan and we must obey every rules we're making there. when something happens against our plan, we just need to stay patience and find the solution by creating more plans. among our whole plannings, there should be few that could be triggered to market and then we can use it for our trading. whatever the outcome is, we must accept it.

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  3. #242
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    All plans here have been so helpful and have given traders the chance to see that the best result is actually made. Plan is needed here and this should go as we have always projected for it. We must stay consistent with better planning because this brings forth the opportunity for us to keep working out on having a good trade as we get more experience. Good plan will give us better detail on the means to earn and see we can have real platform for good trade.

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  4. #243
    Trader Senorita's Avatar
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    What gives us the ability to survive is having a good plan that would bring about a better winning trade in forex. If we can follow the very right plan we make about this trade, we can be able to earn something good that would guide us on making a good trade. A plan is of important and with this we will likely understand what can work out for us here. I do my best to plan on how to manage this trade and for me it's have always helped me to do the right thing consistently.

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  5. #244
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    If you don't have a plan, then you have indirectly plan to fail. Good plans are what helps us to know what is likely to be done and give us ideas on how to make sure the target is been actualized. In this business there is lots of opportunity to make a good trade and if we can have good means to plan on this business, we will be able to succeed perfectly. A plan should be followed and this is what can give us the chance to realize that profits would be made which is so important.

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  6. #245
    Trader juniorpeters's Avatar
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    i use just one strategy to trade the market and it works for me very well because i have practiced the strategy and can hardly lose money trading with the strategy unless i am emotional.that is why its good to stick to one strategy no matter how many times you fail,practice makes a trainer perfect which is the message bruce lee is trying to pass to we the traders.

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  7. #246
    Trader Sixteen's Avatar
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    Quote Originally Posted by Tonycee View Post
    If you don't have a plan, then you have indirectly plan to fail.
    Sadly that's what some traders fails to understand in this business. They don't make the right plans for themselves that's why it's easy for them to loose their capital in a little time. Good plans are for the best here and what should be done is that we must deal with risk and have a measure to as well make good profits. Your plan have to be followed and its likely the best way to deal with risk and see that the best trading is made. I keep ensuring that I plan well and try to assure myself that my plans can help me deal with loss.

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  8. #247
    Trader cutiekc's Avatar
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    Quote Originally Posted by Sixteen View Post
    Sadly that's what some traders fails to understand in this business. They don't make the right plans for themselves that's why it's easy for them to loose their capital in a little time. Good plans are for the best here and what should be done is that we must deal with risk and have a measure to as well make good profits. Your plan have to be followed and its likely the best way to deal with risk and see that the best trading is made. I keep ensuring that I plan well and try to assure myself that my plans can help me deal with loss.
    It takes just more than a plan for a trader to become profitable. First of all the trader ought to comprehend the market then have a trading strategy which they are making use of. A trading plan comes to play when the trader already comprehend the market, has a good trading strategy, a good money and risk management before the plan comes to work.

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  9. #248
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    Today, a trader must try to craft or formulate proper trading plan which will allow him certain positive way of conducting trading activities. Trading plan is the action module which can guide a foreign currency exchange trader to perform all of the necessary activities in systematic ways. But when it is the query of crafting a trading plan a trader must be certain that his planning is well adapted according to his trading needs.

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  10. #249
    Trader J_C_Anderson's Avatar
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    The role of consistency in trading in huge, but many traders, especially newbies, quite often undervalue it. In fact, each trader shall try to become consistently profitable first and only then think about sizing. Professionals even use the definition "CPT" standing for Consistently Profitable Trader, a person who can generate profit for relatively long period of time without substantial drawdowns or huge losses. Of course, it is difficult to be consistent withing several months or even weeks, but it should be a goal for each trader dreaming about trading success. That is why it is better to have numerous small winning trades rather than huge winning trades that occur from time to time. Of course, it is important to act in accordance with the strategy rules and not just close all winning trades as soon as they become green, because such approach could impact risk-reward ratio, so it will be enough to have one losing trade to lose all profits from previous successful trades.
    The first step on the path to consistency is a trading plan. Properly developed trading plan would help trader to deal with different situations that may take place at the market and make right trading decisions to improve trading performance in general.

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