Developing Your Trading Plan

The Trading Plan

&

The Day Traders Daily Preparation:

The Trading Day

Grade how alert you feel between 1 - 10

• Any Distractions ?

• Complete the Prep Sheet

• Trade Log

• Research the Daily Brief

Don't Trade until this Preparation has been carried out Phase I 08:00 - 11:30 Phase II 13:30 - 16:30 (Spot Market Close)

Phase III > 21:00 hr (Futures Market Close)

"TRADE WHAT YOU SEE

TRADE ON PROBABILITIES

DEFINE & ACCEPT YOUR RISK"

Trading Objectives:

Morning Trading = 5 Ticks Afternoon Trading = 5 ticks

NB* Tick Per Lot size i.e 1 lot = 10 euros 5 lots = 50 euros 5 Ticks on a 1 Lot = 50 euros 5 lots= 250 euros Money Management Principles

• Divide the Trading Account into 20 Units (or 40)

• Daily loss limit the size of 1 Unit of the Trading Account

• Have a Nett 5 - 10 tick per day objective (after Commissions)

• Trade for 5 ticks AM

• Trade for 5 ticks PM

• Focus on Probabilities on each trade

• Diversify one's trading

• i.e Trade Butterfly Spreads

• Or Spread Trades (Not to be confused with Spread Betting)

• Outrights to be traded with extreme caution

• Zero Tolerance on the Daily Stop

• Stick to the Butterfly Spread as much as possible

• Trade the Anti Martingale Strategy

• Scale IN to Trades

Losing Trades:

• Take a Pause. Change one's state of Mind (Stand Up, Tea Break or take a Short Walk)

• Wind Down - And Consider what is going wrong!

• Reduce one's Lot Size

Trading Performance Review

• Review Objectives defined

• Compile a Daily Record

• Record if how much one allowed a position to be off side

• Number of Trades

• P\L

"Instead of hoping the Trader should fear; instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a bigger profit!"

Jesse Livermore Reminiscences of a Stock Operator by Edwin Lefevre