Right off the bat – and before anyone gets excited – this plan does not contain the setups or notes related to how I’m going to be actually trading in 2012. Well it does but I’ve got the only un-redacted copy. Sorry. The main reason is that since this is based on material I’ve paid for then sharing it for free will get my arse sued right off. Please don’t be disappointed and remember I’m still at the sideways stage 😉 so you need to go sort out your own plan.
Secondly – this is not a study in how to write a trading plan. I’ve nothing to teach here and nothing to sell you. However I thought it worth sharing as a way of encouraging anyone who hasn’t got one to go write one. You’ll see this is my sixth attempt at doing this since Jan 2011 which means either I’m lazy, incompetent, foolish or all of the above.
I finally got to a place where I recognized that I need this framework to operate in and I’ve pulled together enough actionable ideas to make this a reality for me. Re-reading stuff I’d written before (as well as previous posts on this blog) is frankly embarrassing. I’m sure there will be stuff on here from now that I’ll cringe at in six months time.
I do reference people that have really shed a significant light-bulb on trading for me so it’s worth looking at from that perspective though. A lot of personal information has also been removed obviously!
It’s partially thanks to the following (free!) software that I got this document to the state it’s in. Focal Filter allows you to create a blocklist of sites that you can’t get to for a certain time. Massively useful with all the distractions of email, twitter, facebook and twitter. Did I mention twitter? 🙂
If you’re easily distracted by crap online then I can really recommend it. I know what of I speak etc. There’s a dedicated Mac application for this kind of thing so go googling for it.
However back to the point at hand. It’s taken me far, far too long to get to where I can actually write this. Why? Well lets look at some of the main reasons.
1.) The majority of information I went through from Jan ’11 till Oct ’11 was simply wrong
2.) Trying to trade on a 5 minute chart while working full time. This is simply impossible.
3.) Not understanding the inter-relationships of multiple time-frames. *see below
4.) Not enough time in front of charts, taking trades and seeing how prices move
5.) Not having a clue – at all. Not understanding how important a plan is.
So the major light-bulb has come on about how price moves and how different time-frames can shed light on this. From this point you can get a hint of where a good entry point might be and then plan accordingly. There are no magic indicators as far as I’m concerned.
The other main thing to point out at this stage is relying solely on a chart without knowing what’s going on in the market (i.e. news) is like going into battle with your eyes shut. You can bet that major market participants are paying close attention to what’s affecting their market/their positions.
A final point to make is that record keeping is important. I suspect that this will become a significant understatement in 3-6 months… Record keeping may actually be the only way to improve over time. Read that again and really think about it. If you’re not recording your trades and why you took them then, erm… you’ve probably been getting the same results I have – crap results 😉
I’ll explain how I’m making this work for me and provide a proper trading update in a couple of weeks. Also looking at different brokers/platforms but that’s an entirely unrelated topic.
So there you go.
Well, that’s what 2012 is for right? 😉