A Trading Plan is Necessary for Successful Forex Trading

“Quitters never win and winners never quit.” – Vince Lombardi

Wrong!  There is a difference between good quitting and bad quitting.

Good quitting is used by winners to abandon their losing tactics quickly. This is quitting within a plan, such as the stop loss in a trade, or taking a system off-line if its performance falls outside expected parameters. It is also quitting before you invest too much time and too many resources, such as abandoning a system that does not win.

Reassessing your goals and purpose, and then quitting the things that are not supporting your mission is good quitting.

Bad quitting is reactionary or panic quitting. It is selling your position when the pain is too great, such as panicking because you did not have an exit plan or did not stick to the plan you had. It is quitting when the going gets tough because you never completed a plan for your trading.

Society trains us to equate quitting with failure. In reality quitting is failure only if you are quitting the path to success. Quitting unrewarding efforts is the key to focusing your energy and achieving your goals.

Forex trading is a simple and enjoyable way to make money if we are prepared to follow some basic rules. Most traders, unfortunately, don’t follow any rules and thus they lose. They can see the chart patterns, they have a good idea of when to get into and out of a trade but they don’t follow a set of trading rules called a trading plan. Forex trading is a business and a business needs a good business plan in order to survive. Not having a trading plan or a least not having the discipline to follow a trading plan is the main reason people are unsuccessful in this business.

By |2013-03-04T00:47:42-06:00February 2nd, 2012|Forex Trading Strategies, Phil's Forex Blog|0 Comments