Many traders like to spend their weekend relaxing, but most of the best Forex traders like to spend few hours on Sunday to do small research and prepare weekly game plan.
Today I would like to show you how I prepare myself for the week ahead. This short article will be helpful to medium term & longer term traders (not scalpers), so to not waste any more of your time, I am going to start immediately explaining you step by step my weekend ritual.
How to Prepare Your Trading Plan for Week Ahead? – Step By Step Guide
Step 1 – Summarize Last Week
When I start to work on a week a head plan, I like to check how market moved last week, I will always check this currencies pairs: EUR/USD, GBP/USD, USD/JPY, AUD/USD, USD/CAD, GBP/JPY, USD/CHF, USD/NOK, USD/SEK, AUD/JPY (basically currency pairs that I usually trade), but I also check how other market reacted (commodity, stocks and futures). I am looking to see price action of this currencies, what data move them etc..
When I analyze last week I write all down in the notepad (I like to keep all on the paper) and then I can move to the next step.
Step 2 – Checking Financial Sites
I like to spend 30-45 minutes on weekend to see what financial sites such as Bloomberg, FXStreet, Forex Crunch have to say, you can find many good news that can help you to manage your weekly plan.
Here is what type of news I like to see: “Predictions for ECB Meeting”, “U.S Dollar Hits A Five Year High”, “S&P500 Could Reached A New Low”, “German Dax Jumps, but German Investor Concern Linger”.
When I finish reading useful articles and I find something that can move the market I write it down in the market (We all know that a lot of people is buying the rumors so you need to be aware of them).
Step 3 – Fundamental Data for Week Ahead
Every Sunday I go on sites like FXStreet or Forex Factory and check what fundamental news are coming next week. I write only High Impact news in the notebook, so If I am in the trade, I can just check when the news related to currency pair I am trading.
Step 4 – Weekly Technical Analysis
When I finish first 3 steps I come to my favorite part charting. For this step I spend more than 2 hours making a technical analysis for the next week, I always make a primary and alternate analysis for every currency pair I done, so I got backup if something go wrong. Yes like in the first 3 steps I put this in my notebook, before I move to the next step.
Step 5 – Risk Calculation
Money management is a key of successful traders, so for my last part I like to do risk calculation so I don’t blow my trading account in 1 trade!
Every week I recalculate my trading balance and based on that I calculate how much money can I risk per trade (usually I will risk 1%-3% per trade) and for the end I decide risk/reward ration I want to trade (usually 1:3, in the low volatile market conditions 1:2).
Step 6 – Follow Your Forex Trading Plan
Now when I write all things “Week Ahead Data, News That Can Move Market, Fundamental Market, Technical Analysis, Risk management” , I print my Forex trading plan and put on the board in my office, so I can follow my plan. It is really crucial to follow your Forex trading plan or you waste your time…
In conclusion, to become a successful Forex trader you need to prepare a good trading plan – that way nothing can surprise you during the trading sessions.
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