How to Create and Stick With a Trading Routine – Introduction
Trading the financial markets is one of the most interesting businesses you can be in. To start with, all you need to get started is a computer or a smartphone and an internet connection. You also need the starting capital, but fortunately, you don’t need a lot of it. In fact, trading is probably the only business you can start with less than $300. In addition to this, if you have the skills, you start making money right away. This is the opposite of other companies that you need to give time before you start seeing any returns. Further, you can start trading at home, which means you don’t need an office. You can also be a trader even when you are in full-time employment.
Once you get started as a trader, creating a consistent routine is very important for you. There are two aspects to this routine. First, there is the routine on time management. Secondly, there is the routine on the trading side of things.
The first thing you need to do is to determine the type of trader that you are. If you are a full-time trader, you should specify the timeframe when you will be trading. This could be in the Asian, European, and American session. It is recommended that you trade on the European or the American session because of the movements that happen. The Asian session is usually slightly boring, with no major movements.
The time of the day that you decide to trade should be consistent. For example, if you decide to trade in the European session, you will be able to learn and understand the behaviour of the session.
If you are in full-time employment, you should ensure that you are trading at a time when you are free. You should desist the temptation of trading during your office hours. Doing this will present you with risks both at work and in your trading.
Third, you should have a checklist for what you are supposed to do before you initiate a trade. This checklist should have all the things that need to happen before you initiate a trade. For example, the checklist can suggest that you only open a trade when there is no major economic data expected. It can also say that you only initiate trades of a certain currency pairs, commodities, or stocks. Third, it can tell you to initiate trades when a certain criterion is met. For example, it can tell you to initiate a trade if the short-term and long-term EMA crosses. Fourth, the checklist can tell you the exact levels where you are required to place your stop loss and take profit. Therefore, as a trader, you should always use such a routine.
The next routine is on the non-trading issues. This is because how you are when you are not trading can say a lot about the type of trader you are. For this reason, your routine should include activities like travelling, reading, watching, and hanging out with friends. A routine that does not include such activities will likely lead to burnout which will lead to poor trading performance.