Example of Building a Trading Plan and a Trading Journal

FOREX

Any Skill requires 3 things:

1. Education
2. Application---CONSISTENCY
3. Evaluation

Trade Plan = Measurable way of doing things

Components of Trading Plan
1. Goals and Motivations-know the result before you start
2. Personal Strengths and Weaknesses-know yourself
a. We only trade our beliefs
b. What do you do best and what are your weaknesses.
c. Tharptradertest.com, similarminds.com
3. Routine—develop habits (positive habits) (very specific---e.g. specific trading
times, breaks, evaluation times, what to look for, which charts, even personal
stuff, etc)
a. Looking for fundamentals
b. Looking for technical
4. Systems –YOUR methodology (not Justin’s, or Sam’s or Irfan’s ---yours)
a. Where, why, and how (locations, context, reasons to take trade, and then
how to execute it.)
b. Two systems to apply to different contexts
5. Review-Evaluation of your performance and results (We recommend you run
report every 20-40 trades and look for when, what, and how to improve)
6. Rules Section-quick snapshot of your do’s and don’ts
7. Appendix with pictures of charts and examples

Question to ask yourself; if I were to write and submit this plan to a professional, would
they be willing to give me money to trade?

Online Trading Academy

Property of Online Trading Academy; to be used strictly for educational purposes Page 1
 Sample Plan
Include Business Name
Goals and Motivations
1. I want to quit my job in 2 years and must provide enough income through trading
2. Make enough money to provide additional travel
3. Support my family who are aging
4. Have freedom to set my own schedule
5. Contribute to charities
6. Financial freedom

Personal Strengths and Weaknesses

Strengths
1. Organized-Why?- Have spent the last 10 years managing a business
a. How it will help me-Trading requires proper organization of plans and logging of trades for
evaluation. Proper organization will enable me to remain focused, intent, confident, and
efficient (will help with measuring your results)
2. Determination-Why?-Determination is second nature in the business I have created.
a. How it will help me-trading is a game of persistence; it is a long-term journey. I must be
intent to accomplish my goal
b. How it will hurt me-

Weaknesses
1. I am afraid of losing money
a. Inability or Potential Pitfall—indecision or doubt when triggering a trade or executing,
overtrading, heart attack, jumping in too early, triggering a trade without a S/D level,
jumping out too early (taking profits too early)
b. Solution-Set it and forget it on my trades
c. Another solution-trade a micro account for several months and just follow my trade plan to
gain confidence
d. Set specific ratings (odds enhancers sheet) and only take trades that rank 8 or better
2. Lack of Focus
a. Inability to develop plan, panic because not present for the current trade, may miss trades
or opportunities
b. Solutions-dedicate a very specific 2 hours to trade and only trade those hours
c. Turn off Youtube or Gmail or Pandora
d. Get an office without windows!
e. Organize workplace for optimal focus
f. THE POWER OF NOW!!!!
g. Routine helps—

Online Trading Academy

Property of Online Trading Academy; to be used strictly for educational purposes Page 2
 Routine
Specific for your business hours
1. Wake up at 5 am
2. Stretch
3. Eat breakfast (oatmeal, eggs, fruit)
4. Get dressed and out the door by 5:45 am
5. Arrive at office by 6 am, turn on computers
6. Review my organizer to see if there are any important duties or even special goals that I want to
accomplish
7. Meditate---relax and visualize
8. Review my trading goals and my journal from previous day (Goals-trade skillfully and not make the
same mistakes made the previous day)
9. Look to the news and economic calendars to find fundamentals and sentiment 6:20am
(forexfactory.com, finviz.com, fxstreet.com, traders dashboard, marketwatch.com,
dailypfennig.com)
10. Then go to charts
a. Start-Top-down (Monthly to 15-min)
b. Higher time frame charts—look for major supply and demand zones and trend
c. Intermediate time frame charts---look for minor supply and demand zones and trend
d. Record potential opportunities on a workspace on TS
e. Once opportunities are found, I will establish execution criteria (how, entry, stop, targets,
etc.) (establish a PLAN or course of action)
11. Plan all set usually by 7am
12. Break at 8:15-8:30am
13. Take lunch at 11---if no other opportunities available or made some money—go home end the day
of Trading.
14. Evaluate, review performance and record in my journal (usually at the end of trading)
15. Done at 4pm no exceptions

Systems-------don’t forget to include risk management

Intraday Strategy (Trend following strategy)
1. Context—up or down trend as defined on a 240-min chart
2. Where and Why (S/D zones are market timing and Trends are market direction (context))-
a. Establish major trend on 240-min chart
b. Establish major (extreme) supply and demand zones ---do not take a trade into these zones
c. Go to 15-min chart to:
i. Find minor trend
ii. Find minor supply and demand zones
iii. Detail the major supply and demand zones
iv. If the major trend is up and minor is down, look for a demand zone to engage a long
v. If the major trend is down and the minor trend is up, look to short at supply levels
vi. If the major trend is up and minor is up, look to short at extreme (usually 240-min)
supply levels

Online Trading Academy

Property of Online Trading Academy; to be used strictly for educational purposes Page 3
 vii. If the major trend is down and minor is down, look to go long at extreme (usually
240-min) demand levels
viii. Choose targets at opposing zones
3. How to execute-
a. A #1, #2, or #3 entry (set and forget, within the zone, or full confirmation)
b. Which indicators or MA
c. Price patterns
d. Candlestick patterns
e. WHAT TRIGGERS THE TRADE?
f. Trade management
i. When do I move my stop (2:1)
ii. What timeframe?
iii. What time of the day?

Review and Evaluation

1. Specific times set aside for evaluation (not only for each trade, but have weekly and monthly
reviews of performance)
2. What metrics are you looking for (every 20-40 trades look for specific things)
3. Issues to correct
4. See what is working so you can take advantage of those factors

Rules and Quotes Suggestions

1. Buy at demand; sell at supply
2. Never take the same idea twice in a row
3. Never move stop loss until 2:1 is reached
4. Always be grateful for my results
5. Every trade taken makes me better
6. Never open a position without a stop loss
7. Never trade a major economic news release
8. Always set up your trades correctly the first time
9. “You miss 100% of the shots you don’t take” –Wayne Gretsky
10. "Life is a process. There is no success or failure, only feedback." Van Tharp
11. “Make each day your masterpiece”---John Wooden
12. “A losing trader can do little to transform himself into a winning trader. A losing trader is not going
to want to transform himself. That’s the kind of thing winning traders do.” ---Ed Seykota
13. Plan your trade, trade your plan

Appendix with Pictures of Examples

Online Trading Academy

Property of Online Trading Academy; to be used strictly for educational purposes Page 4
 Trade Journal
Helps recognize patterns within thinking and actions

1. Form of your journal

a. A binder with printed charts and comments of pre-trade, during trade and post-trade
b. Bound journal—match journal entries with days or specific trades
c. Excel spreadsheet
2. Must record at minimum:
a. Situation—describe the situation as objectively as possible (entry, trade management, exits,
or something else)
b. Thoughts or self-talk—describe how you feel, what you think, what your mind is telling you,
what your body is telling you?
c. Consequences—what actions did you take in accordance with your thoughts in that objective
situation
d. Record your mistakes (definition of mistake is something you did that was in violating your
plan)
3. Must review this at least weekly
a. Review each day before you trade
b. You will find patterns in your actions and thoughts

There are no guarantees implied with any strategies in this document and losses can and may occur.
Strategies are presented for educational purposes only. This is an example for students to use as a guide
to create a trading plan that will fit their style of trading. Online Trading Academy, its affiliates cannot be
held liable for any losses that you may have while employing any strategies in any markets.

Online Trading Academy

Property of Online Trading Academy; to be used strictly for educational purposes Page 5