Why do you need trading plan?

If you make a mistake while trading on the market, you will be punished very quickly. The market doesn't like mistakes or carelessness, so the price will be a minus from your DEPO. This is just how things work. Because of this, planning is an important part of successful trading and not just a feature of an option that doesn't help you reach your goals. Today, we'll talk about what a trading plan should look like and lay out a clear set of rules that a trader can rely on in his work, no matter what the market is like, how long the investments are, or how much money they have to invest.

If you don't have a plan, you're setting yourself up to fail.

Remember this simple rule and stop trading based on how you feel. The market is not the place to make hasty decisions.
If you have a clear trading plan that includes all possible ways to respond to changes in the market, you won't doubt the rightness of your trading decisions, and you'll be much less likely to make emotional trades that hurt your trading account.
A trading plan and a trading diary will help you become a more disciplined trader and use your time, money, and nerve cells more wisely.
In trading, what is a trading plan?
If a trader doesn't have a plan for how to trade, he or she is likely to lose money in the market over time. As a broker, I have seen dozens of examples of this rule being true. This was also clear when I opened my first trading accounts. Most traders who consistently lose money on the financial markets do not have a trading plan. They open and close trades on a whim, or if they do have a plan, they ignore it when it would be best to follow it.

Keep in mind that one of the hardest things about this kind of business is to stick to a trading plan. Just ignoring it once is enough to erase the trading results from the last few weeks or months. Trading is based on discipline, but it won't make sense if you don't have a clear plan of what can and can't be done.

In trading, what is a trading plan?
There must be at least five parts to a trading plan. Also, each of them could be a possible answer to the question:
Can you trade on the market right now?
Which way should you trade? (if it's a directed trade)
How to figure out the right time to enter the market?
How to define the goal and limit the risks?
How to figure out the best size for a position?
This is the "skeleton" of a trading plan. Each part needs to be written in detail on its own, based on the trading method, risk tolerance, and details of the markets being traded.
Not every part of a trading plan is as important as the other parts. Some of them need to be changed to fit your trading style (Points 1, 2, and 3),while others should never be ignored or changed in a big way, or trading on this account will end very quickly and tragically (Points 4 and 5).
To sum up what has been said, the following can be said:
In the trading plan, you should list all the ways you could react to a change in the market. If this happens, you won't have to worry about "force majeure" anymore. Sharp market movements and losing trades will definitely happen, but the risk of negative trends will be taken into account in the trading plan and will not be able to cause a trading account default.
Most of the time, the market is just like any other place. And if a trader loses money because the market went up or down by 5–10%, the problem is probably with the trader's plan and the fact that he or she didn't follow money and risk management rules, not because a Fed official said something.

The most important thing for new traders is to learn how to work with a trading plan and risks. They shouldn't think about how easy it is to get into the market, how many Xs they can have, or how carefree their life could be. You can only stay in the market and start to fully grow and develop as a trader if you stop making rash decisions that cost you your deposit.
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✅Disclaimer: Please be aware of the risks involved in trading. This idea was made for educational purposes only not for financial Investment Purposes.

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