Writing a Bitcoin Trading Plan
In bitcoin trading there is no single method or formula that's used for trading the btcusd trading market successfully. The cryptocurrency market requires traders to learn and acquire the skill required to trade the btcusd trading market successfully. Bitcoin traders need to learn how to analyze the btcusd trading market movements. Bitcoin traders then need to come up with a plan of how to come up with a way of combining this knowledge and the strategies they have learned so as to formulate their overall trading method.
By coming up with an effective trading plan your success will improve significantly. A bitcoin trading plan will help you to effectively analyze the btcusd trading market and know when the best time to open a trade is and when it is best to close the trade.
Before starting to trade the bitcoin trading you must be prepared with a bitcoin trading plan. Just like in business where all successful businesses start with a business plan also successful bitcoin traders must begin with a bitcoin trading plan.
Sections of a Bitcoin Trading Plan
Bitcoin Chart
The first section of a bitcoin trading plan will specify the trading instruments that a trader will be trading. Traders should specify the trading instruments which are best suited for their trading method.
Before deciding the most suitable trading instrument to trade a trader will have taken time to test their cryptocurrency trading strategy on various crypto charts on a practice after which they will choose the instrument that produces most profitable results. The trader will then list this trading instrument on the trading plan as the instrument that they trade.
Chart Timeframe
The trader will also have to specify the chart time frame they will be using to trade bitcoin with. For example a trader may find that the best chart time frame for their cryptocurrency trading system is the 15 min chart time frame and therefore they will specify their chart time frame as the 15 minutes chart time frame.
The chart time frame that a trader chooses will depend on the type of trader they are. For day traders who have a lot of time to watch the charts they can choose the 5 minutes or 15 minutes chart time frame and trade with these charts. For swing traders who don't have a lot of time to watch the btcusd trading market they can trade with the 1 hour crypto chart time frame so that they can be able to follow the medium term trends that will last for a one or two days.
Bitcoin scalpers on the other hand can trade with the 1 min chart time frame and trade the short term market moves. These traders will make many trades during the day and just like day traders they will also have a lot of time during the day to watch cryptocurrency market moves.
BTCUSD Trading System
This section will specify the bitcoin trading system that the trader will be using to trade the btcusd trading market. This section will list the rules that a trader will follow when opening a buy or sell bitcoin trade. It will also list the rule that a trader will follow when closing their trades - for example it will note the take profit levels as well as stop loss levels that a trader will set after they have opened a trade.
Trader will write-down if they will be using an technical indicator based cryptocurrency trading system to generate bitcoin trading signals or the trader will write if they will be using support & resistance levels to open and close trades or any other technique that the trader will be using for trading. For example a trader may specify that they will be using automated bitcoin trading systems and they will write the parameters of the automated cryptocurrency trading robots on this section.
Before writing the bitcoin trading system that a trader will be using, the trader will have back tested this cryptocurrency system on a practice account until the time that the cryptocurrency trading system is producing profitable trades on a consistent basis and after coming up with a profitable bitcoin trading system the trader will then write down the cryptocurrency system on this section of their trading plan.
Mindset
This section will specify the mindset that you'll be following when trading so that to ensure that you become successful when trading.
Discipline - This will list that you'll be disciplined enough to follow the rules of your cryptocurrency trading system & trading plan. Discipline will mean that you'll be patient enough to wait for a trading signal from your bitcoin trading system before opening a trade. This section will specify that you will only trade the signals that are generated by your cryptocurrency trading system and you will not second guess your cryptocurrency trading system and open trades not indicated by your cryptocurrency trading system.
Trade Without Emotions - when it comes to trading the btcusd trading market you should not let the emotions of fear and greed control you when you’re trading. You should always trade based on the rule of your trading plan. Avoid becoming greedy & wanting more profit from the same trade instead of closing the trade at your take profit level.
BTCUSD Trading Money Management
A trader must specify their bitcoin trading money management guidelines that they will use when trading. For example a trader can specify that they will use a high risk: reward ratio which means they will place their take profit level at two times what they set their stop loss level. This will make their bitcoin strategy more profitable in the long run because they stand to make more money from their winning trades & lose less money from their losing trades.
