You must HAVE A PLAN for EVERY SINGLE trade and investment decision that you intent to make. Every time you decide to click the buy or sell button, it should be a part of YOUR PLAN! When you attempt to trade someone else’s numbers blindly or you make generalizations about the market to drive your decisions without clear exit plans in place for your trades and investments, you set yourself up to fail!! That is why we say failing to plan is planning to fail. If you don’t have a clear plan for any move the market might make once you have entered a position, you are exposing yourself to the pain of the unexpected. Plans that are solid and clear, which also account for your individual personality, will provide a framework to evaluate when it comes to your results! If your plans are something like “I will buy Bitcoin because it’s going to be worth $1,000,000 per Bitcoin someday,” but you have no real idea what you plan to do if you buy Bitcoin and it loses half of its value within a single 1 hour candle, then you are setting yourself up for both a painful emotional and financial experience. The market is the BEST teacher you could ever ask for, but if you don’t make a clear decision as to how much tuition you plan to pay ahead of time, then you will find yourself paying the market much more than you ever wanted to when you set out to make money as a trader-investor.
We’ve listed a few items below to take into consideration when developing your trading plan. There is no point in trading if you don’t do it the right way.