Trying to come up with a trading plan ...

Discussion in 'Strategy Building' started by djxput, Oct 12, 2006.

  1. djxput

    djxput

    I'm getting back into trading and I feel I really need to concentrate on a more concrete trading plan.

    In the past my trading plan was 'sketchy' and this led to lots of losses. ie my entry might have been good but my exit blew or my entry would be bad and I'd take too much of a loss on a short trade ...

    I'm not sure if this forum is the best place for my question but here goes ...

    - I dont use indicators; I just look at price and volume.

    I use mostly candles/trendlines/and chart patterns for my trades.

    For the past week I've been studying charts (intently alot of hours) - and I'm attempting to come up with a working plan so I can rely on this instead of using my gut in the heat of the moment (fear and greed krept up so much when I did that).

    I'm getting real bogged down thou ...
    since I dont use indicators; and trendlines and chart patterns and even some candles can be subjective. I'm feeling like there's just too many variables to account for to make a decent trading plan.

    I look at one chart and I think I got a plan going then the next one I look at and something totally different happens.

    It feels as if I'm trying to quantify an art-form from random occurances.

    Art-form being my trading style and random occurances being the market.

    I've been studying charts on and off for 10 years ... and while I feel I got a pretty good grasp on different things about charts putting that knowledge into a workable plan is daunting.

    Here are some thoughts I had recently when trying to nail down some aspects of my trading plan ...

    - So when I set my stop do I look for it to close there or am I looking for a touch there (so many long legged wicks that you never know sometimes what will happen).
    - Trying to figure out how to define a pause in a trend compared to a failed breakout or a reversal and placing my stop accordingly so I dont lose out on profits and dont get them taken away either (this has been a tough one to figure out).
    - figureing out where to enter the trade in the first place; if I enter too early sometimes what I thought was there isnt really there; and then if I enter after the breakout ( I miss alot of the move and alot of times it retraces anyways or pauses the next day - but then again sometimes not).

    the above are just some examples of what I'm going through in trying to figure out my trading plan.

    ... Maybe I need to give myself some room and not try to make it so I can catch every move down in a trend and never be caught off guard.

    So what do you suggest?

    thanks for the help