I always suggest you to make your own trading system. It is because you know your self best. In other words, you should be the best person to know what match your stock trading’s needs the most. Of course, there are many the ready system (free or paid) available that can be utilized for stock trading. By using the ready system, we do not need to create our own anymore. In other word, it saves our time.
As stock trader, you should have heard about Trading System. You should have known that the trading system is very important to make profitable stock trading. In other words, by having trading system, we can make profit consistently in our stock trading venture. Therefore it is a must for us (as stock trader) to know what exactly is the trading system so we can utilize it to make money in stocks.
As per definition, trading system is a set of trading rule or method which is organized, regular, and repeated.
As per definition above, in stock trading term, having the system means that we do stock trading with the fixed rule or method that we strictly follow several times or more regardless the changing in the stock market condition. We should strictly follow this rule or method during the trading. We can only change or modify it after the trading ends.
However, we should not change it too often so the system can be proven in various stock market situation. It needs to make a reliable system by using it in various condition. In here, we can also call this system as trading plan since it is about how we plan to do our trading before we start to trade. It is the detail plan about how we do our stock trading from start to the end indeed. Now, we should already understand what is the trading system or trading plan based on its definition.
For more understanding about it, let’s discuss what is the trading plan based on the practice. Let’s say that we have USD 1000 to be spent on the stock trading. If have the system (or the plan), we should know how to spent the money exactly. The system will tell us:
- How much we should use to buy the stock
- How much we should have it as reserve
- When to buy the stock
- When to hold the stock
- When to sell the stock
- How much the target profit
- How much acceptable loss
- What kind of stock that we can buy
- What kind of stock that we cannot buy
With points above, it can be said that we have a business plan (in concrete way) how to do stock trading with USD 1000 in the right way. In here, the right way means that we have the detail plan how to consistency make profit more than the loss. It mustn’t a big profit but enough for a tiny profit but consistent more than the loss.
In here, by not having this trading plan, it can be said that we plan to be fail for sure. It is because, without the plan, we do stock trading as gambling – not as business. Without trading system, we can only follow our feeling or people’s recommendation which is very dangerous since we do not have or know the essence for sure.
As conclusion, trading system is a must for stock trader if see the stock trading as a business – not as a gamble. The trading system can help us to do stock trading in the right way hence we can make money in stock with optimum result. In here, the trading system talks about profit consistency – not about one time big hit of profit. It is okay for tiny profit as long as it is consistently more than the loss.
Have a profitable stock trading by having trading plan everyone!
Previously, we have learned the simple way how to make money in stocks by using trendline. Before move to our current hot topic (which is another way to utilize the trendline), first, let’s refresh our mind by summarizing what we have discussed in the previous article. As mentioned in previous article, we have learned how we can use the stock chart’s trendline to decide whether it is the best time to buy or to sell the stocks.
In previous article, we have learned how to draw the trendline for stock trading which is a useful tool to know the current stock market trend. As I have also mentioned, knowing the stock market trend is very essential for stock trader – especially for retailers – to gain optimum profit in their stock trading venture. In short, we can make money in stocks by using trendline based strategy. Indeed, this trading strategy is quiet simple which are “buy if the trend is up, sell if the trend is down, and stay away if the trend is nontrend (sideways).
As I have mentioned before, the stock market trend is everything in stock trading since the trend can tell us in which cycle the stock market currently. For your information, knowing the stock market cycles is a must if want to gain maximum profit from the market. I have discussed about three available stock market trend. However, I haven’t yet discussed in detail about how we can know the current stocks market trend exactly.
It is already Monday again — a new day of the week which is a perfect day to look into our stock trading plan. It is very important since the world-wide stock market is very volatile lately. We need to check whether it is the time to sell, buy, or hold the stocks. Indeed, it is the time to look into Stock Market Today report. As I have mentioned before, I am a trend trader who highly dependent on the world-wide stock market trend analysis which I share through Stock Market Today article. Yeah, we should know the world-wide stock market since these days, each stock market is globally connected.