Steps to Creating a Trading Strategy Part 1
Any trader, professional or amateur, must have a trading strategy. Traders who enter and exit the financial markets arbitrarily, without ever developing a set of conditions and rules for doing so, are unlikely to be successful.
A trading strategy is a set of predefined rules that govern when and how a trader enters and exits a financial market.
Trading strategies are heavily influenced by the individual trader, their trading profile, style, risk tolerance, and available capital. There is no such thing as a “holy grail” trading strategy that is suitable and successful for every trader.
The prospect of developing your own trading strategy may appear intimidating.
The good news is that developing a trading strategy is actually quite simple. The bad news is that making one that is profitable is much more difficult.
1) Choose Market appropriate for you
The first step is to decide on a financial market in which to trade.
Although this may appear to be an obvious first step, it is by no means insignificant. Trading strategies will be determined by the market on which they are traded. What works in the commodity market may or may not work in the stock market.
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