Simple Reasons Why You Need A Good Trading Plan

1) Entry Plan - there's only 1 good reason for having a working entry plan, which is to make the profit faster. If you have a good entry plan with more than 50% winning rate but not more than 60% (to tell you the truth it is very rare to have an entry plan that hits more than 60% rate in the long-term) that will make your profit more than 50% faster. When the price moves in favor with your open positions, there's no problem with that. You will simply profit. But there's another side of the story when your trade goes south. This is really the point where you need a good trading plan. How you will handle the floating negative profit.

2) Money Management Plan / Lotsizing - this helps a lot. but MM is not only about the calculation of the risk to have a good lotsize then you use stop loss, or hedging or grid. It is a plan about the logic of the mathematics of lotsizing that will make you able to escape a losing trade. So MM is somehow a part of the exit plan.

3) Escape Plan - all your plans above are all useless if you don't know or you can not imagine how to end the losing trades. So before entering a trade, it should be clear to you how to escape if the trade is losing. If your exit plan is just a guessing game to you, then you are gambling no matter how good the analysis that you use on your entry plan and MM plan. There are many tricks available to exit a losing trade. You can actually find them on the internet but how to exactly use them is another story. No one really tells how. In my upcoming book (or ebook, I haven't decided yet on this) I will tell you secrets (yes contrary to what people are saying that there's no such thing as secret strategies. they really exist but they are not magic wands. they just make the direction of your trades clearer than before) or high-probability-rate principles so you will know your escape plan. The book (or ebook) will be released in the 4th quarter of 2019. PRE-ORDER IS CLOSED.

Bonus: I will conduct a one huge webinar FREE to all who pre-ordered the book. It is not free for those who didn't pre-order the book. But you can pay if you want to attend this webinar. I will be discussing one important part of the book. A complete working trading plan and the logic behind the GABot Expert Advisor that my inner circle has been using for almost 2 years now. The webinar is called DEFENSE TRADING PLAYBOOK. The schedule is on June10, 2019.

Click here to register:
https://fxfledgling.blogspot.com/p/defensive.html?m=0

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Forex Trading Myth

Somebody asked me...

STRANGER: Can I actually replace my full-time job with income from Forex trading?

ME: Yes. How much is your job salary?

STRANGER: $50,000 a year. Can you show me how?

ME: Your freedom depends on how much you are willing to invest. How much you are planning to invest for your initial fund?

STRANGER: $200 only. It's too risky.

ME: Ok. But it will take you 11years or more to earn $50K per year with that kind of investment, if and only if you can consistently earn 5% a month. That's on compounded . (Boom)

The Myth 

Many traders have been dreaming that they can really achieve their dream life with just a $200 of investment. They think that it's a magical get-rich-quick scheme that will give them unlimited income with a few dollars.

The Reality 

This kind of mentality makes them trade with large lotsizes with a very small fund on a live account. They usually ended up disappointed. To achieve the freedom that you've been dreaming of, you have to plan for it. Learn Forex trading at least how to earn safely and conservatively if you have a job. It is possible to earn 50% a month or more (believe me, I have friends who earn this much trading Forex fulltime) but you have to invest a lot of time and money before you can come up with the best trading plan that you have longed for. Since you are having a 9-5 job, you have to be realistic on your plan. Aim for at least 5% a month safely (very doable).

If you want to replace your job income with trading income, do the math. If you earn 5% a month with Forex trading, you need to have at least $85K fund to earn $4,250 a month, or $51K a year.

If you are only willing to invest $200 for this, you need a good consistent system that can make you earn 5% a month to make $85K money in 11 years.

So how much you are willing to invest?

PS It will take you more than 11 years to earn the dream fund if you will withdraw some profit along the way.

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To Use Or Not To Use Stop-Loss

This has been dabateable since the beginning of Forex Trading.

Some traders say that not putting an SL is a suicide and some say that putting an SL, either visible or mental SL, is more dangerous to your fund. 

Why traders have different point of views on this? This is actually because it depends on the experience of the traders and therefore also depends on the kind of strategy that they have been using. Most likely some traders had a bad experience for not using SL that's why they are saying not using one is a no-no. On the other hand, some traders had a bad experience in using SL so they promised themselves not to use it anymore.

Another reason for this, maybe some traders became successful (short-term or long-term) on not using SL. Of course, this is debatable again to some traders. They would say that success will not last for a long time. But if you haven't experienced what the successful non-SL traders have experienced, you are not in the position to tell that what they are doing is not proper. They know a trick that you don't know.

On the other side, to those who are in dispute to those who are using SL. If they are successful, it means they know something that you don't know on how to use SL.

Opinions of traders are limited and based on what they already know and what they think they already know (There'a a difference actually hehe). It is also limited to what they have experienced.

So next time you heard a strategy from another trader and you think there's something wrong to what he is doing, do not be quick on judging, bashing, harsh comments, etc. "Respect" is the first keyword that should be in your mind. Respect on others' strategies may lead you to learn new tricks that you never thought possible. Respect promotes collaboration. Collaboration delivers quick success. 

PS - On trading with or without SL, both are equally risky if you don't know what you are doing.

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