Original subtitles

a trading plan pretty much does what it says on the tin right it's essentially

just a document that describes your systematic approach to trading your

defined edge in the market with your entry exit and risk management rules

so in simpler words your trading plan is just your training strategy written down

pretty much right now you will have this plan either

printed out on your desk or on the wall beside your computer or at the very

minimum have it on your notion dashboard just to make sure that it is somewhere

that you can easily access it especially all times when you are trading because

you will be reading this before and during every single trading session so

that it is constantly at the forefront of your mind because this literally will

be your trading bible now over the course of the next few modules you're

first going to create your own individually tailored training plan

and this will initially be a very rough and basic plan because you have not yet

had the opportunity to actually test your plan to trade it and to figure out

exactly how you want to trade the strategy

but before you can actually start that process of testing and trading you

obviously need a plan as a starting point right because you need that plan

written down you know first in order to actually be able to test that plan

you can't just start firing into any old trade that maybe you think resembles a

strategy because that's just going to be a recipe for disaster and any data that

you might be collecting it's going to be pretty much irrelevant

at that point because you know the data is not a part of a defined strategy

so the first step is just to get your very very kind of rough

first draft of your plan written down and then everything will build from

there so once you have that first draft you will then begin the testing phase

which is what we will cover in depth in the next module

and then once you've tested it and you've collected data to prove that it

does have a profitable edge you can now begin to start to trade it in the live

market and see how you get on then as you gain more experience you gain more

data on how your trading plan you know how it actually plays out in the market

you can then refine your plan make improvements and evolve it based on that

hardcore data that you have collected to actually improve your edge even more

and then finally you will then create your next version of your plan

and repeat the entire process and this process will continue for the rest of

your trading career your trading plan is literally a living and breathing

document which you will always be evolving as both yourself and the market

evolves with it now obviously when you create a new plan

or even just a revised version of your plan

and once you've tested it you don't have to start trading it live or on demo

straight away you of course can keep refining your plan based on your testing

data until you get it to a stage that you're

pretty happy with you know and then you can start to trade

it live once you've got it to that point

so that's pretty much the journey that we're going to go on together throughout

the next few modules now if you can't describe what you are

doing as a process then you don't know what you're doing

so your eventual goal is to have a full flowchart diagram

that describes the complete end-to-end process of your strategy with an if then

and a yes no format so a robot could almost literally execute it for you

now as you've probably experienced i've been thinking as you've been going

through the technical analysis lessons there is quite a lot of moving parts to

the strategy and it definitely can be pretty overwhelming when you're first

learning this style especially if you are brand new to trading in general so

creating a training plan it can seem like quite a daunting task because your

level of understanding and your experience with the strategy it's still

in its very early and premature stages and don't worry that's absolutely normal

and okay so you know don't worry stress about that but if you follow the steps

as laid out in this course if you continue to study the content and if you

continue to put in the hard work it's literally only a matter of time before

it will all click and it will all become extremely simple and second nature to

you whereby you achieve that fourth stage of competence remember that's when

you are unconsciously competent where you can drive your car home and without

even thinking about it you will get to that point with your training but then

you can literally boil your your training plan you can boil it down to

just a few key words that you you look at before and during each training

session and those key words those keywords of kind of your your simplified

training plan that will encompass all of the detail and the complexity of your

process that you now subconsciously understand

but simple can be harder than complex you

have to work really hard to get your thinking clean to make it simple but

it's worth it in the end because once you get there you can move mountains

so i knew someone who was a chef and quite early in their career they had a

bit of a tendency to make their dishes extremely complex

because you know understandably they thought that was how things worked

more stuff on the plate must equal more skill and therefore surely that must

lead to more rewards right but then this young chef he went to a michelin style

restaurant and at the time it was regarded as one of the best in europe

and the head chef at this restaurant he was a fair bit older than him

and he had been in the game for a very very long time and this michelin star

chef he only ever put just three things on the plate just three things nothing

more and the simplicity blew the junior chef away

but more than that it was the level of execution of those ingredients that

impressed him everything was simple but literally perfect

so after his meal the junior chef went and spoke with the michelin star head

chef of the restaurant and the head chef told him that he had also gone through

kind of that exact same process as him when he was younger as well when he was

starting out in his career where he initially he kind of found himself over

complicating everything and trying to make these really high

complex meals but the michelin star chef he said that

he was thankful that you know he'd gone through that journey because the

complexity of his approach initially that complexity that gave him the

knowledge that was required in order to now be able to execute the simplicity of

his dishes perfectly so the lesson here for us

is that elegance and consistency that actually comes from simplicity

that simple recipe that he now has but to get to that level of simplicity

first you need the deep understanding and that deep understanding that

actually comes from the initial complexity

so what i'm trying to say here is that your first few initial versions of your

trade plans they might actually be quite complex

you know when you're writing out a lot of your process and there'll be a lot of

words and a lot of explanation and that's fine because that can you

know really really help you at the start but eventually you will find kind of as

you go along and you get more experienced and you kind of really

refine your style you will boil it down to just a few key

sentences on one page so you should end up with one very simple trade plan and

then also your full enter in process laid out as a separate flowchart diagram

alongside that but of course you know that short

simplified trade plan that is what you will be looking at before and during

every single training session now there are a lot of things that you

can include in the contents of your plan but i recommend that you have these

three components as the bare minimum so as long as you define how you will

enter the market how you will then exit your positions out of the market and how

much you will risk on those positions then you are pretty much good to go

so the very first time you create this you know make it simple or as complex as

you need to but just get something down for all three of these sections because

you just need something that you can then go and test and then once you're

testing it then you can you can start that process of refinement but you just

need the starting point so you know don't try and kind of

perfect it straight away because it's pretty much going to be impossible just

make sure you get going now there are of course other sections

that you can add such as you know diagrams of your entry model screenshots

of actual trade examples from your plan you may want to list the specific

trading hours that you will trade within list the pair or pairs that you actually

trade and you know if you trade multiple pairs

you may have you know slightly different rules for each pair um and i haven't

listed it here but you can even go you know in a lot of detail kind of your

risk management and your risk limit rules as well so of course this is not

an exhaustive list but just something to get you thinking about

now in the next lesson i will show you kind of a beginner's trading system that

you can use as an example to kind of see how this could potentially all be laid

out for you now training is an individual sport i

can teach you the theory and i can show you how i trade but ultimately the

responsibility falls on you and no one else it's just you who's gonna be

pressing buy and sell no one's going to do that for you

you are here to become an independent and consistently profitable trader

that is going to require you to build develop and evolve your trading plan

into something that is unique to you of course it will still be heavily based

on the core concepts but you then need to take those and mold it into something

that makes most sense to you that suits your training psychology and that you

can actually execute with your current lifestyle and your current routines

you know trading it's not rigid with very hard and fast rules people make

their own interpretations based on the theories and the concepts provided and

trade what they believe to be right there's a million ways to make money in

the markets odds are that you're not going to be

good at scalping day trading swing trading and position trading if you try

to do them all you will most likely end up being you know a mediocre jack of all

trades and a master of none so don't spread yourself too thin at the

surface level because to truly reap the benefits of one strategy you have to

sacrifice the others identifying what you should focus on and

specialize in is where that compounding momentum will take off

so go deep on that and specialize because that's where your processes and

your results will become more predictable scalable and sustainable

style drift comes from not clearly defining your strategy and your goals

as a result you won't stay with your approach through the thick and thin

if you are a short-term day trader you must recognize that exiting a trade you

know for a quick 50 pip profit only then to watch it go on for another 300 pips

that is of no real concern to you because you specialize in and operate in

a particular zone of an instrument's price movement but someone else they

might operate in a totally different area of the curve but both traders can

be successful however if you are a longer-term trader

there's going to be many times where you are running in a decent amount of profit

but only to give it all back in the pursuit of trying to capture a much

larger move but the key is to just focus on a

particular style and then once you define your style and your objectives

will then become much easier to stick to a plan and to attain success

and then in time you will be rewarded for your sacrifice with your own

speciality and it takes the same commitment that

you would make in a relationship you know how good a marriage do you think

you would have if you kept cheating on your spouse a trading strategy is the

same you need to be faithful to it for it to give back to you

because just because we can do something doesn't mean that we should do it

so if we know that if we spread ourselves too thin up here you know on

the top surface level it's very unlikely that we're going to really reap the

benefits of a particular style of trading unless we dig deep down into it

and specialize so we know that digging below the

surface that is where the oil is that is where the treasure is and that is where

the real gold lies so when we are up on the surface and we

can see all these different ways of trading

how do we know where the oil is below how do we know where to start drilling

down to the surface because one way to drill would be to

just start you know randomly driving all over the place and just finding out you

know through process of elimination where that oil is and where the gold

lies that's going to be quite you know time inefficient and you could waste a

lot of money you know drilling down into all the wrong areas right

so that begs the question how do we work out exactly where it is that we should

spend our time and where we should spend our resources drilling down into to find

that oil to find the gold that looks deep beneath the surface

well there are a few steps to this first you need to get real with exactly

who you are and where it is that you want to go

because once we identify this we can then move forward and determine

precisely what actions you need to take to get there

and this is the time to get real with yourself so you can map out a clear plan

of action and move forward unimpeded so there are four main steps to figuring

that out and the first step is to very clearly define your trading goals so

what are you trying to achieve and why but you must also consider your current

lifestyle so what are your current time constraints and commitments and then

it's time to dig deep into your training history and your journey so far you're

really looking under the hood at everything the good the bad the failures

and put out all of the lessons that you can find from here because there will be

many if you spend the time to look hard enough

now of course if you are new to trading or you are new to this strategy then you

will not have a relevant training journal just yet to go through now so

this step does not apply to you just yet but these steps the next two steps we're

going to look at number three and number four they are for when you are refining

and improving your already established trade plan

so you know you will study your trade journal to try and identify the patterns

and commonalities within your past trades so that you can implement rules

to help you to do you know more of what works and to do less of what isn't

working for you and then once you do this you will

pretty likely find that you're going to identify some

some psychological blockages that you may have that are actually holding you

back but once you identify those

first you know you must find out exactly why you have those blockages and then

you can implement steps to help you overcome them so that they no longer

hold you back and limit your growth and now you will be able to rise to that

next level so spend some time getting very clear

and honest with yourself on what you were trying to achieve and why

because if you want to become a full-time trader then it will most

likely make sense to develop a strategy that's quite active maybe hands on you

know maybe on the intraday time frames because you will be able to you know be

at your computer screen undisturbed but if you want to trade around your

current job or maybe even running you know another business that you own or

you work within of course this is also possible you know contrary to what

instagram might make you believe you don't actually have to quit your

nine-to-five job to be considered a professional trader

but you must be realistic and adapt your strategy to work around your job or

business you know you will not be able to be on the charts and you're probably

actively trading the same way a full-time trader can be

now it's very similar for if you are someone who wishes to travel and trade

you will most likely want to either develop a longer-term hands-off strategy

where you are setting risk entries on the longer term time frames with kind of

that set of forget management or go to the complete other extreme and maybe you

just want to day trade you know one or two days a week for example where on

those days you do not travel or explore that day but you dedicate those days you

know that that time solely to training so when you're thinking uh you know

about your training goals do not focus on that sort of end result

you know i.e you know you want to replace your income with the

trading profits instead focus on the process and the lifestyle

you know what lifestyle do you want to live

because it's that lifestyle and that process that is actually going to get

you that result it's very common for people to want the

monetary results that successful training can bring but it's not so

common to desire the lifestyle that that result requires

now by lifestyle i don't mean you know what house you're going to live in and

what car you're going to drive what i mean is what is your everyday

life trading routine going to look like to achieve that result that you want

each day so start thinking about this now

then once you have a clear idea of what your goal is and what you're trying to

achieve with your training then you can start to plan out the steps that you

need to take to get there and a big part that is going to determine what steps

you can actually take will be what your current lifestyle is so what are your

current time constraints what commitments do you have

do you have dependents you know do you have young kids or maybe you care for

someone do you have a nine-to-five job if so do you have regular access to your

trading charts now think about what time frame can you

actually enter on what time frame can you manage your trades on is it

realistic that you will be able to monitor the one-minute chart for entries

during work you might need to drop your ego a little bit don't worry about

trying to get you know a two pip stop and instead build a trading system

around the m15 risk entries for example you know maybe using the m15 or even the

four hour for entries that could be a lot more sustainable for you and you'll

actually have better results in a quicker period of time so maybe you just

need to you know look at a few more pairs if you're going to be looking on

those hard time frames and that will be looking you know working better for you

and if it's just not realistic to split your focus between your job or your

business or maybe you do something that means that you don't even have access to

you know the internet or your computer when you're working then swing training

will probably be a lot more realistic for you right focusing on those hard

time frame moves now another major thing to consider is

what time zone do you live in for instance if you live in new york

and i believe you are in the eastern time zone then the london session starts

around 3am for you so are you going to get up early to be on

the charts for you know 3 am how realistic is it that you can then

trade the london session through the early hours of the night and still

perform your job during the day and keep your health and your mental well-being

intact because some people can do it and they

feel that the sacrifice is worth it but most can't so figure that out and be

honest with yourself and just pick what is most sustainable

and maybe you can you know even look at concentrating on currency pairs that

sometimes move more during the new york session and even the asian session so

pairs like aussie dollar and the japanese pairs um you know the

japanese yen pairs and specialize in those

now if you really want to hang out on the beach and you want to travel the

world then you should probably work on swing trading or even position trading

strategies because it's not really that realistic that you're probably gonna

have you know great wi-fi on the beach or by the pool and you know the sand in

your laptop or the sun glare on your screen

it's not really realistic that's going to affect your trading intraday right

but if you like the excitement of facing a new trading day with a clean slate

just training for a few hours then day trading might be for you

now you might think that day trading sounds sexy but if you have a demanding

job and two kids maybe it's not that realistic for you

right but only you are gonna know this but

just try to be honest with yourself now and you'll save yourself a lot of time

and headaches you'll find quicker success but more importantly sustainable

and scalable success you know by sticking to what you can

currently execute so design your trader plan around a style that actually fits

that obviously then once you achieve your

goal and your lifestyle changes then you can adjust an adapter trade plan to fit

that right now as i said the beauty of the strategy is that it's based on price

action you know i've shown you the blueprint and all the tools that you

need but now it's down to you to kind of take that and tailor all of that and

tailor that strategy to suit your lifestyle

now we'll talk about journaling a lot more in a future lesson

so we're not going to cover this in depth now but kind of a quick point is

that when you are revising and improving your trade plan you know going forward

analyzing your trade journal will play a large large large role in this so you

will essentially be trying to look for repeat patterns and commonalities in

your winning trades and then the same for of course all of your losing trades

so this way you can work out how you can do more of

what is working and less of what isn't so that you can implement new rules into

your trade plan to avoid repeating those same failings now don't rush this

process it's not glamorous it is pretty boring not gonna pretend it isn't but it

is one of the single most effective things that you can do to make a quantum

leap forward with your results because if you spend a week a month however long

it takes you to do it properly get it done the lessons will be in there some

of the biggest lessons and improvements that you can actually make with your

training will be in there you know digging through your journal

that is the work that other traders they just simply are not doing

so if you do do it you are literally giving yourself a massive edge over them

and in that previous step where you have reviewed your trading history you will

probably have found technical problems with the strategy which you can make

simple kind of adjustments and you know improve with new rules in your plan but

you will also probably find that you're making the same silly human errors again

and again so this final step step four it's all

about finding the why why are you making those same mistakes

and you need to identify your psychological blockages and there is a

lot of introspection that goes into this process you know what are the main

barriers that are holding you back and then what is your plan for actually

overcoming them the more reflection self-review and

contemplation that you perform as a trader the quicker you will progress

for instance you know when you review your journal and you kind of look

through the data you might spot that you know every time you lost the first two

trades of the day your results then spiraled and you took a lot more losses

when this happened so very simply you can implement you

know pretty simple risk management rule to just stop trading for the day if you

take two losses for example now this lesson is not about trading

psychology we will cover this in a lot more depth later

but for now you just need to understand the four-step process to go through each

time you are revising updating and improving your trade plan and that's how

you can define your own you know your own trading personality and actually

create a plan that is individually tailored to you

because once you have that you will massively increase the chances of you

actually adhering to your strategy rules which in turn then increases the

probability of you achieving long-term consistent results

now in the next lesson i'm going to show you a relatively basic

trading system for you to use as an example to see how you can begin to

structure your own trading plan