5 steps to profitable trading with oiltradingroom

1. Plan. Plan your trade and trade your Plan. This one cannot be disputed. What is a plan though? To me a plan is an answer to the following questions:

- Under what market conditions do I enter the market?
- What is my position size for this set up?
- What is my set up(s)?

2. Wait. This one is simple but difficult to execute with millions flashing in front of your eyes every hour. Simply sitting there on your hands and WAITING for your setup (plan). If you cannot wait, you will be forced to trade outside of your plan and that would mean breaking rule number one which is the most important rule. Worse yet is if you make money while deviating from your plan and not waiting for your setups; it will hunt you down eventually.

3. Execute. How many contracts? What kind of order? Surprisingly your entry is of least importance if you follow your plan and focus on the next step which is...

4. Manage. Once you are in a trade it means (hopefully) that you waited and executed your plan to the T. Now you have to focus on where to place your stop orders, targets, when to move your stops (only in the direction of the trade) and when to move your targets, close position or reverse your position.

5. Review. This is probably the least amount of time that is dedicated to by most traders. Professional sport players always review their performance and try to figure out where they can improve to get the edge over their competition. Review in trading is imperative, this means spending time with charts after the market closes, reviewing every trade and signal and replaying the market action at fast speed (if your software allows). Also reviewing your trading journal where you write down what you are thinking about the trade or the market, your trades, news events, your mental state before, during and after a trade.

Screen Shot 2014-10-03 at 4.44.52 PMTry these steps in the coming weeks and see what difference it makes in your trading. I know it will.