Please note ThinkMarkets does not provide CFD services to residents of the US.

Please note ThinkMarkets does not provide CFD services to residents of the US.

Learn To Trade
 
Indicators & Chart Patterns

Deepen your knowledge of technical analysis indicators and hone your skills as a trader.

Find your detailed guides here
Live Webinars

Boost your knowledge with our live, interactive webinars delivered by industry experts.

Learn More
Trading Glossary

From beginners to experts, all traders need to know a wide range of technical terms. Let us be your guide.

Learn more
Knowledge Base

No matter your experience level, download our free trading guides and develop your skills.

Learn more
Learn To Trade

Trade smarter: boost your skills with our training resources.

Create a live account
Market Analysis
 
Market News

All the latest market news, with regular insights and analysis from our in-house experts

Learn more
Economic Calendar

Make sure you are ahead of every market move with our constantly updated economic calendar.

Learn more
Technical Analysis

Harness past market data to forecast price direction and anticipate market moves.

Learn more
Live Webinars

Boost your knowledge with our live, interactive webinars delivered by industry experts.

Register now
Special Reports

Engaging, in-depth macroeconomic analysis and expert educational content from our in-house analysts

Learn more
Market Analysis

Harness the market intelligence you need to build your trading strategies.

Create a live account
About ThinkMarkets
 
Sponsorships

Check out our sponsorships with global institutions and athletes, built on shared values of excellence.

Learn more
About Us

Find out more about ThinkMarkets, an established, multi-award winning global broker you can trust.

Learn more
Careers

Discover a range of rewarding career possibilities across the globe

Apply now
ThinkMarkets News

Keep up to date with our latest company news and announcements

Learn more
Trading Infrastructure

When it comes to the speed we execute your trades, no expense is spared. Find out more.

Learn more
Contact Us

Our multilingual support team is here for you 24/7.

Learn more
About ThinkMarkets

Global presence, local expertise - find out what sets us apart.

Create a live account
Log in Create account

How to create a trading plan

If you’re serious about becoming a trader, a trading plan will be vital. Here's what your trading plan should contain.

 

Creating a trading plan

If you’re serious about becoming a trader, a trading plan will be vital. Here we discuss some important assets your trading plan should contain.
 

Assessing your skill

Have you tested your strategy? Are you confident that it would work? Can you follow your strategy without hesitation? If you haven’t mastered your trading strategy yet, it might be best to practice and tweak it until you’re confident in implementing it.
 

Mental preparation

Trading can be an emotional rollercoaster, so it’s important that you trade stress-free – if you’re facing personal challenges or not up to the challenge of trading, it would be recommended not to place the trade. Be sure that you only open a position if you’re emotionally and psychologically ready.
 

Set your risk level

When trading, you should set a risk level that you’re comfortable with. Professional traders tend to risk no more than anywhere between 1-5% of their capital – what you choose should be dependent on your trading style and risk tolerance.
 

Set yourself goals

Before you start trading, you should set yourself goals in terms of realistic profit targets and risk/reward ratios. As a trader you should set weekly, monthly and yearly profit goals and assess them regularly to see if you’re on track.
 

Prepare for trading

Before you start each trading day you could follow a series of steps before placing your first trade. For example, research the major news announcements for the day, set up support and resistance zones on your charts, or even read through your trading plan.  
 

Entry and exit rules

Before entering a trade you should know where your stop loss and profit targets are going to be placed.

When entering a trade, the entry should be based on a tested trading strategy. Your trading plan should highlight exactly when and where you are going to enter, what the indicators need to be doing, what the pricing action needs to be doing, and what’s occurring on the different time frames in order for you to enter the trade.

You should then be prepared to exit the trade at your pre-defined target – while it may be tempting to keep the position open if the markets are moving in your favour, they could change at any given moment.
 

Record everything

Keeping a record of your overall trading performance can help analyse how effective your trading strategy is, and can highlight where you’ve gone wrong if you experience a period of losing trades.
Key information to make note of could be:

  • Your entry price

  • Your exit price

  • Your original stop loss and take profit levels

  • The position size

  • Comments on why you entered the trade

  • Your emotions during the trade

  • Your profit or loss

  • A screenshot of the chart at the time of entry and exit

Having a plan is crucial if you want to become a consistent trader – never underestimate the power of planning.
 

Back to top