A Trading Plan from “I”
My trading rules as an EOD trader:
1. Only take trade setups that offer a 2:1 or greater risk reward
2. Only take trade setups which are in the direction of the prevailing trend
1. Check for trend of main market
2. check the higher time frame of the instrument
3. If no trend then use other methods such as stochastic – stochastic is good for spotting potential divergence – * also be wary about setups which exhibit little by way of a trend.
4. Once a setup is activated do not place any further trades until your initial trade has completed a 100% move in * the preferred direction taking into account your stop.
* Once this move completes bring stoploss to Buy/Sell point. (I always have stops – in my case the stoploss, risk/reward is calculated for me by the software I use). In terms of money I risk £50 per trade.
5. Do not move stop again until price target is reached.
1. Once price target is hit bring stop to low/high of previous bar
2. If instrument is in a strong trend use trailing stop such as ATR signals as it can be that using first method will take out your trade sooner.