When you have your forex trading strategies you might be looking at ways that you can better them. There are a number of steps that you can take in building better forex trading strategies. These steps are generally easy to follow and to use. Of course, you do not have to change the strategy you are using if you are happy with it.
Write Down the Forex Trading Strategies
While this might seem like something that you would do if you are going to change your strategy writing the strategy down is something that a lot of traders neglect. These traders feel that they know the strategy and will be able to keep track of everything in their head. Writing down the strategy does not only help you keep track of any changes that you are going to make, but also helps you to identify the issues.
When you write down the strategy you are able to see all of the steps. If one step does not lead to another logically then there is a problem. You will also be able to determine whether or not your strategy is too complex. Many expert traders state that your strategy should be able to fit onto a post-it note. If it does not then it is too complicated.
What Market Does Your Strategy Perform In?
When you are looking at creating a better strategy you need to consider the market you will be working in. All strategies work in either the trend or the range market. There are very few forex trading strategies that will be able to work in both of these markets. If you cannot determine which market you should be using the strategy in then you are going to have a problem.
You need to know which market to trade in so that you can set your trading times accordingly. If you are looking for a trend market then you should consider the market session overlaps. However, if you are looking for a range market then these times are the worst times to be trading.
Do You Have a Measurement System?
Having a system that you use to measure the success you have on the market it important. Once you have set up the strategy you need to be able to track the success you have. There are a number of different methods that you can use to track your success. The best way is to have a trading journal.
You should incorporate the times when you have to update your journal into your trading plan. This means that you are going to be setting aside a time when you will update the journal. You trading journal is the best tool that you can have for a number of reasons. The journal will hold information about your trades that you will not be able to find elsewhere.
There are a number of steps that you have to take when you look at building a better trading strategy. You first have to write down the strategy, then you need to determine when you can use the strategy and you have to consider how you are going to track your progress.