Several traders start trading by designing their own trading strategies. This is good to design a system of your own because it will help you understand the intricacies of trading. On the other hand, designing trading strategy is comparatively easier than designing a profitable trading strategy. Beginners are supposed to start with the practical approach, wave analysis and right expectations. As I have mentioned above that forming a trading strategy is comparatively easier because after learning the tools of trading and indicators, you can design your own neowave strategy.
However, this is not a practical approach if you think that your first trading strategy will bring millions if not billions. One of my colleague asked me that why to design your strategy when you already have strategies of other traders. Why we cannot use profit-making strategy of other traders? Remember that every trade and approach is different. A strategy may be benefiting a trader, but it may not be fit for your business environment or circumstances you are using it. On the other hand, you will always benefit from a unique strategy, which has a personal touch.
Your understanding of trade
It is imperative to understand the trading market completely before you design a foolproof strategy. You can do it by going through the reading material. Fundamental and technical analysis of the system will help you understand it better. Do not try to become rich at once.
This is your first the strategy so it is advised to keep it as simple as possible. A complex strategy may confuse you from the beginning. Moreover, it will be difficult for you to manage it and improve it because of its complexities.
Choose a market
You need to decide whether you are going to invest in equities, or in forex? Understand the models of forex brokers and find out how they calculate the margin.
While investing in trade equities, you need to understand what a share means. Detailed information about blue chip and penny stock will definitely give you an upper hand.
The purpose of going through the intrinsic details is to have a complete idea of the functioning of trade market. Moreover, you will not have in-depth and practical knowledge unless you choose your trading market and start trading.
Improving your trading strategy
Thisis going to be your first strategy and it is obvious that it may not bring desired results. Do not get disheartened, it is okay. This is not static as you have gained experience and now you can do required changes in it. Your experience and knowledge is growing at every stage of trading, which you can use for the betterment of your trading strategy. You cannot leave this to chance because it may bring results or it may not. You have to learn how to take the glenn neely feedback and use it in the improvement of your strategy.
You can test your trading strategy and make notes of everything you observe in the market. Maintain chart images in a proper order for understanding.