How to Write a Good Indices Trading Plan
indices trading plan checklist - the following is a template example of a indices trading plan template example:
JUSTIFICATION
1. TRADING IS A BUSINESS, SUCCESSFUL BUSINESSES ALWAYS HAVE PLANS
- Businesses that are successful always start with a plan.
- Successful business planning will guide you to success, think of indices trade plan as a map; it is a constant reminder of how you will consistently pull profits from the stock indices trading market.
- Difference between a successful trader and a losing indices trading one is the indices trade plan.
2. TO KEEP ME IN THE RIGHT DIRECTION
Consistency is important in your routine to measure how successful you are.
Keep you on target, read the indices trade plan every day and stick to its trading rules.
When it comes to your plan you should think of it as a map that shows you this is what you follow, it should have clear rules that specify when you open or close a transaction.
Your indices trading plan should cover all aspects of indices trading, you should read the indices trading plan every day until it is on your fingertips so that when you are transacting on the fast moving market of indices trading you will always know what to do in every situation.
Your indices trading plan can be as simple or as complicated as you like, but the most important thing is that you have one. By having a one you have an advantage over the stock indices trading market, you will have better odds of making a profit than those who do not have one.
This indices trading plan checklist tutorial topic provides with an example indices trading plan template that you can use for creating your own indices trade. By now you have already written down the justification part of your indices trading plan template, If not get a pen and paper and write the justification part. Next we shall look at how to write the system.
Indices plan is one of the secrets that can help you to improve your profits. A good indices trading training guide like this one should show you how to come up with one using a indices trading plan template which you can use as an example to develop your own indices trade plan.
One of the most common question is, Is Indices profitable? one of the methods to make it profitable is to have a good plan.
IF YOU HAVE A GOOD BUSINESS PLAN AND YOU ARE DISCIPLINED ENOUGH TO STICK TO IT YOU WILL BE SUCCESSFUL.
GOALS OF THE TRADING SYSTEM
- Ability to IDENTIFY A TREND AS EARLY AS POSSIBLE .
- Ability to AVOID WHIPSAWS .
The indices trade system should find a compromise between the two Goals,
Find a way to identify a indices trend as early as possible but also find ways to help you distinguish the fake signals from the real ones.
FUNCTIONS OF EACH INDICATOR
MA - Identify a new indices trend as early as possible.
MACD - Identify a indices trend as early as possible.
Determine strength of a continuing trend.
RSI - Swing failure to confirm the start of a new indices trend.
Extra confirmation tools to help determine the strength of our indices trend.
Parabolic SAR - Help to ensure that we are not caught up on the wrong side of the trend.
Indices Trend Lines - Signals a reversal when the line is broken
Indices Price Action Signals - confirm the weakening of a trend.
Bollinger Bands - for stock indices price action study
To learn and know more about each indicator and how these indicators can be used to generate trading signal setups you can go to the Stock Indices Indicators Section
CHART TIME FRAMES
- Main time frame is the 1H.
- Signals are generated on the 15 minute time frame.
15 Minutes Charts
- Indices Trend Lines (Support & Resistance)
- 5 & 7 LWMA
- RSI (14)
- Bollinger Bands (20, 2)
RULES
LONG ENTRY
Entry
15 Minutes Charts
- Both MAs are moving UP
- MACD moving UP
- RSI > 50
- Parabolic SAR is below the stock indices price (Support)
When signal is generated on the 1 Hour Indices Trading Chart, use the 15 minute indices chart time frame to open and close positions.
LONG EXIT
- RSI gives opposite signal
- Indices Price breaks Support Indices Trend Line
- Parabolic SAR is hit (Trailing Stop)
RULES
SHORT ENTRY
Entry
15 Minutes Charts
- Both MAs are moving DOWN
- MACD moving DOWN
- RSI < 50
- Parabolic SAR is above the stock indices price (Support)
When signal is generated on the 1 Hour Chart, use the 15 minute indices chart time frame to open and close trade positions.
SHORT EXIT
- RSI gives opposite signal
- Indices Price action breaks Support Indices Trend Line
- Parabolic SAR is hit (Trailing Stop)
ROUTINE
- Signals are generated using 1H indices chart time frame and executed using the 15 minute indices chart time frame.
- Trading signal to be executed immediately trading rules are met.
- Entry alert signals should be executed during daytime.
TIME OF DAY TO WATCH MARKET - MARKET HOURS
Watch market during daytime when most companies and online indices brokers are open for transactions. Use this to come up with a suitable program.
Example
Tips - You can use the MetaTrader 4 Indices Trading Software Platform to save this as a indices trading template that way you do not have to lay it afresh every time you open a new stock indices trading chart. If you want to learn how to save a indices trading plan template on the MT4 stock indices trading platform, read: MT4 Indices Trading Platform Tutorials.
Indices Trading Money Management
- Day trading - Low risk High return method
- Trade when I have a high risk to reward ratio 3:1 or more
- Stop loss = Parabolic SAR
- Set TP target 40-60 Indices Trading Pips
- Never transact beyond 3 % of account equity
- Never risk more than 2 % on a single indices trade transaction
Indices MINDSET/PSYCHOLOGY
- Trade without Emotions (greed, fear, anticipation, impulse, bias, over-excitement)
- I trade what my eyes see not what I feel.
- I will be patient.
My job is not to be the indices trading system!
It is not to decide which signal looks promising.
That is the job of my indices trading system - which has a set of indices trading rules which tells me this is what I follow. Do not get caught up in stock indices price action and make rules as you go along.
MY JOB DESCRIPTION IS
To sit patiently and wait for my indices trading strategy to indicate that it is time to enter or it is time to exit. And then with great focus I execute the indices trading plan as outlined.
Taking trades not indicated by the indices trading system, second guessing it and not taking signals given, hesitating and getting in late, anticipating and getting in early are all common place and boil down to lack of faith in the plan and not having a burning focus on accurate execution.
GOAL: To have 100% undivided focus on mastering my ability to execute my Indices rules accurately.
The more you develop the ability to step back from stock indices price movement and watch the stock indices trading market dispassionately, waiting for a indices trading signal, the easier it will be to witness the fluctuations of your emotions without getting sucked into them allowing them to throw you off your game.
WEAKNESS
- I am greedy.
- I over-trade
- Make a list of all your weaknesses that are interfering with your trading. This is the first step to help you overcome these weaknesses. Use Indices psychology to help you overcome them.
NB: by writing down your weaknesses you will start recognizing them as you make progress, once you do this you will start to avoid this mistakes and your results will improve.
GOALS
- To focus on exit just as much as I do on entry signals.
- Always protect my account using stop loss, indices trading money management methods, follow with the indices trend direction and always following the trading rules of my indices trading strategy.
- Never second guess or go against my trading strategy.
To always keep up my discipline. - Follow all the rules of my indices trading strategy and never break them.
- Transact fewer times and execute all my signals correctly.
Trade what I see, what the system + stock indices trading charts are telling me. - Sit patiently and wait for signals from my strategy.
- Achieve consistent indices trading results before opening a live stock indices trading account.
FOLLOW THIS Indices SYSTEM
This is the most important part of creating the indices trading system.
Always follow the trading rules
Stick with the trading rules
Be disciplined and patient enough
Indices Trading JOURNAL
Log all my trade transactions in a indices trading journal so as to track my training progress and improve my indices trading execution trading methods.
This indices trading strategy uses momentum to determine the indices trend of any indices.
Even if you are new to stock indices market and you do not know how a indices trading system looks like, this indices trading system template example illustrates to you how a indices trading strategy should look like, the Indices tutorials explained in other sections of this training website will also explain further the different aspects that you need to learn.
Hence, the aim is to help you come up with your own complete indices trading strategy that is if you are looking for one, by showing you one that is already complete. In fact you can just use it as it is, or make a few adjustments so that it suits your indices trading style.
The aim is to help you improve your indices trading results by using a indices trading plan, and another advantage is that this indices trade plan will offer you a chance to improve your knowledge and it will help you improve your indices trading results and help you make pips when stock indices trading and keep them so that you do not keep giving them back to the stock indices trading market.
Read this indices trading plan training tutorial about developing a indices trade plan of your own, along with the learn indices trading courses and indices trading strategies listed at the top of this learn indices trading tutorial website.
The Most Beneficial part of using this indices trading plan template is the "Indices Trading Money Management Part" you will learn how to trade indices and minimize risk, which is the most important thing when it comes to trading the stock indices trading market.
Indices Trading Plan Checklist - How to Develop a Trading Plan in Stock Indices - Indices Trading Plan Example - Indices Trading Plan Doc