Forex Trading - Rules of Thumb 2

Consistent and discipline

In order for you to be able to realize the full potential of your trading systems it is very important that you take every Forex trading entry, adjust every stop, and close out every trade when your pre-defined Forex trading system says you should.

This takes an extreme amount of confidence in your trading systems, good and reliable technology, and the unwavering discipline to stick to your trading plan no matter what happens.

The good thing about have an underlying assumption about being consistent and disciplined is that you have a pre-defined plan for every situation that you may face in your trading, so that you know how you are defining what being consistent really means. Your plan needs to include at least the following items in it if it is going to be successful:

• All of your trading rules for entering, adding to, and getting out of your positions
• What you are planning to do if your trading computer, internet connection, broker, power, telephone etc. fails to be of any real use or break down
• What you will do if for some reason you are unable to trade
• What you will do if you lose a certain percentage of your account
• What you will do if all the markets are closed and you can’t get out of your current positions

Unless you write down the answers to all these scenarios, you cannot be properly consistent and disciplined in your approach to trading and if you lose money you will not know if it is because you didn’t follow your plan, your plan is incomplete, your systems do not work, or if it is because you are simply going through a losing period.

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