A trading plan is crucial because it provides a structured approach to trading, helping you make informed decisions and avoid emotional reactions. My trading plan outlines my goals, risk tolerance, entry and exit criteria, and strategies. This helps me remain disciplined and focused.
By defining entry and exit criteria, a trading plan has helped me manage risk effectively and maintain consistency in my trading.
Additionally, it has allowed me to evaluate my performance, learn from mistakes, and adapt strategies as market conditions change.
Ultimately, a trading plan is essential for achieving long-term success in the financial markets.
When you draw up a plan and you learn how to follow that up, it is going to be hard to break into another mould, you will become the person who does that and it's good if it works but if it doesn't work then finding something else, or giving up what you have is hard. I have met with people who had not so great trading strategies, and what they got was very little return sometimes and bad days mostly and overall their result wasn't that great, but because they were in either small profit or small loss, they always thought that the big day would come and they would finally make some profit, of course that never worked out for them in the end. I believe that it is not that easy to make this work, and we are going to have hard time with it.