One of the new trader asked how to develop a trading plan. One of the veteran trader who has made millions trading and is Stockbee member gave him the following advice:
I do not have a link or resource that I can point you towards to develop a trading plan, but here are a few thoughts.
If you are struggling (losing money) and trading without a plan (throwing darts). STOP! Doing the same thing and expecting different results is ridiculous
Eliminate the noise.
Take this site and only read Pradeep's post. Take his teachings, study them and from them begin to develop your own plan. Paper trade it or buy 10-share positions to develop confidence. Learn and adjust.
Work harder.
Honestly assess your commitment to the process of becoming a successful trader. Most of what happens during the trading hours is the execution and the realization of the work you have put into reviewing hundreds of charts before and after market hours, looking for that one or two gems where you can commit your capital
Do the exercises
Pradeep has outlined and/or suggested. Trading really is hard work, but can be VERY rewarding once mastered
Make a commitment to never taking anyone else's trade.
In the years I have been here never once have I taken a trade from Pradeep or another member. If a symbol is posted and you want to evaluate it according to your own analysis, do so. Unless you are day trading, successful trading rarely requires a snap decision without thoughtful analysis
Learn to use alerts.
A simple trading plan is to buy a stock as it crosses up through its 50-day moving average. Go through your entire universe of stocks that you want to trade and set up an alert where you would like to enter. This will help you get better entries.
Draw trend lines on your stock charts.
Up trending stocks tend to move in zig-zag patterns creating a channel. If you get an alert when a stock hits the bottom of your channel, buy it and set your stop to close the position if it closes outside the bottom of the channel. Take profits when it gets back to the top of the channel.
Go into this adventure of trading knowing that it is you, and only you who will ultimately determine if you are going to be successful or not.
Make the commitment, avoid others opinion, quickly get out of positions when they go against you, trade small to build confidence and keep a journal documenting your trades, your thoughts about the current markets, why some trades worked and others didn't.
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