Beyond The Markets

Advanced · Lesson 1 of 9 · 6 min read

Your trading plan

A trading plan is a short set of rules you follow every time. It turns trading from guessing into a process you can test and improve.

What and whenEntry, stop and targetA daily routine

Why you need one

Without a plan, every trade is a new decision made under pressure. With a plan, you only act when your conditions are met, and you can look back and see what works.

Key idea

If you cannot write your strategy in a few lines, you do not have one yet. Keep it simple enough that two people would take the same trades from the same rules.

What goes in it

  1. Markets: two or three you know well, for example EURUSD and gold.
  2. Times: when you trade, for example 08:00 to 11:00 UK only.
  3. Setup: exactly what must happen before you enter, for example “4-hour trend up, price pulls back to the 50 EMA on the 15-minute chart, then a green candle closes above the previous candle’s high”.
  4. Stop loss: where it goes, for example just below the pullback low.
  5. Target: how you take profit, for example 2R, or half at 1R and the rest at 3R.
  6. Risk: how much per trade (1% or less) and a daily limit, for example stop for the day after 2 losses or −2%.
  7. No-trade rules: no trades 15 minutes either side of high-impact news, no trades on Friday afternoons.

A simple daily routine

  • Before: check the news calendar, mark the key levels on your markets and note the higher-timeframe trend.
  • During: wait for your setup. No setup, no trade. It is fine to take no trades on a day.
  • After: log every trade in your journal with a screenshot, and note whether you followed your plan.
Example

“I trade EURUSD and gold, 08:00 to 11:00 UK. I only buy when the 4-hour trend is up, and only sell when it is down. I enter on a pullback to the 50 EMA on the 15-minute chart. Stop beyond the pullback, target 2R, risk 1%. I stop for the day after two losses.”

Change the plan slowly

Judge a plan on at least 30 to 50 trades, not on the last three. Change one thing at a time, so you know what made the difference.

Common mistakes

Avoid these
  • Changing the strategy after every losing trade.
  • Having rules but skipping them when a trade “looks good”.
  • No daily loss limit, so one bad day becomes a disaster.

Check yourself

1. Name four things a trading plan should cover.

Any four of: markets, trading times, the setup, stop loss, target, risk per trade, daily limit, and no-trade rules.

2. Your setup did not appear today. What do you do?

Nothing: no setup, no trade.

3. How many trades should you take before judging a plan?

At least 30 to 50.

Try it on BTM

JournalLog every trade, see your stats and spot your habits.Free Trading ToolsPosition Size, Risk : Reward, News Calendar and Chart Guide.GuidesOne-page guides for every indicator and AI scanner.

For education only, not financial advice. Trading carries a high risk of losing money, especially with leverage. Only trade with money you can afford to lose.

For educational purposes only. Nothing here is financial advice. Past performance does not guarantee future results, and trading carries a high risk of losing money, so only trade with money you can afford to lose. Read the risk warning.