Section 1: Make your own trading plan
Price action is understanding the common behavior of the market by looking at how it moves on the charts. We'll go through the foundations of technical analysis such as understanding candlesticks, drawing supports and resistances, identifying rend and proper risk management.
Things you need to know first
Before we start making our own trading plan, there are things we need to understand and decide on such as our expectations from the market as well as how much time and effort we can dedicate to it.
Choosing what suits you best
We all have our own circumstances and preferences. Knowing these from the start, we can tailor-fit a trading plan that suits us best.
Types of analysis
Let's define what are the types of analysis we can incorporate to our trading plan, then decide on which ones we should use.
Guide to Technical Analysis
Technical analysis defines our conditions for entry and exit in the market. However, we can't just randomly put a bunch of technical theories and indicators together and call it a plan. Each aspect should be purposeful and efficient.
Guide to Fundamental Analysis
Fundamental analysis isn't just about positive and negative news releases. It's about knowing which of these fundamental drivers affect the current market most. From there, we can have a general bias if the market is bullish or bearish.
Guide to Sentiment Analysis
Sentiment analysis is how the market participants view the current state of the market. Is the market predictable and stable, or is there much uncertainty? These conditions pave way for a risk on or risk off scenario.
Risk Management & Trading Psychology
Both risk management and trading psychology are important in becoming consistently profitable in trading. Risk management minimizes our risk and maximizes our gains, while trading psychology gives us the right mental approach to trading.