Trading Plan Sample 2

Goal:

To make (and keep!) a minimum of 2,400 pips in 1 year (i.e. a minimum of 200 pips per month). My forex account is modest, but the size of my account is not a factor in how motivated and disciplined I am. My view of trading is summarized in two words: making pips. The by-product of making pips is money, but while I am trading I am not thinking about cash. I am not forex trading for money or thrill.

Target currencies:

I will be swing trading the Yen crosses – EUR/JPY, AUD/JPY, NZD/JPY, CAD/JPY, etc.

Behavioral rules:

(1) If I have no real trading ideas, I am not going to put in a trade. I am not in the business of overtrading.
(2) If I lose 3 trades in a row, I will not place another trade on the same day and will skip the next day.
(3) Adding to positions is allowed only if they are in profit and if the risk of the trade is kept the same, e.g. by moving the stop loss to break-even or profit levels.

(4) Changing the stop level further away from the entry point for a particular trade is allowed only if the stop is up to 130 pips away, and if this doesn’t increase the risk beyond the one stipulated below.

Risk management rules:

(1) The stops for my positions are up to 130 pips away from the entry point.
(2) I will start with risking approx. 5% of my total account balance on a trade, and will gradually reduce this to 1%.