A construction of a trading system is very relative, since the trader is faced with many individual choices. However, external factors must be treated, including the fundamentals of risk management, the principle of money management and control of the trading tool used. Once these techniques acquired, it becomes easier to trade and therefore a return on its investment.

Why build a trade?

The creation of a profitable trading system is very sensitive to the extent that many risks await the trader. This is why it is essential to adopt a trading plan before placing a position.


Adopt a trading plan

In simple terms, the trading plan brings together rules and guidelines to be followed during the negotiation on a financial market such as Forex. This trading plan reduces personal decisions which may affect the negotiation for the benefit of an automation system analysis, which is more developed, while also being safe for investment. These trading strategies will be beneficial for long-term trader, as can more easily analyze your mistakes and correct them.

The design of the trading system

The design is the first step in building a trading system. In this step, the trader sets the time frame used to read graphics, depending on the strategy it intends to adopt, namely:

1. scalping,
2. swing trading,
3. day trading.

For those who are new to trading, it is advisable to use a single time frame at first, then the options to enhance As negotiations. Indeed, simplicity is an asset to be found easily in transactions. Furthermore, it is important to test the trading system over several time units due to the volatility of financial information. Among other things, the behavior graph of a trading plan may be different on a few minutes compared to several years. In addition to the time frame, the system design integrates trading, too, the choice of tool to define the trend. Among the most widely used, there are the dishes and moving averages, which can be reinforced by other indicators as and operations. Finally, depending on the means of defining the trend, we must also choose a system to confirm the trend.

Tips for building a trading system

To have a reliable trading system, it is also advisable to adopt some strategies to use and tricks that can help.

Strategies for entry and exit

Before placing a position in a market, it is strongly recommended to have a plan of appropriate input and output. The entry point should allow an optimal balance between gains and losses, which requires a good analysis of real-time statistics. In addition, it is recommended to set the input on trends that last, instead of those whose duration is estimated at a few days. For example, a rebound on a moving average or the breaking of a trend are opportunities available, depending on the strategy. For the release, several alternatives also exist, with the aim of cutting losses fast enough. Among the choices available to the trader include:

* the cut-off levels for fixed gains and losses,
* partial cutting positions,
* cut on a fixed threshold.

Moreover, the risk factor is also to consider when building a trading system. Determining the risk / return ratio will effectively play on the show and the performance of the trading strategy adopted.

Other recommendations and tips

The current trading software to test strategies with demo mode that facilitates the evaluation of the trading system over the long term before applying it with real money. The system including Expert Advisor can be simulated in minutes, the operation of the trading system over several years. Very reliable, this test system is preferred against the back test discretionary is tedious and imprecise. In addition, the breakout strategy is recommended in the negotiations on the market. The trick is to take advantage of the sudden change in the price of a currency pair after the break. Other recommendations are based on the strategy of marketing money. Indeed, it is important to ask the stop loss so tight, in order to limit losses. There is also a good analysis of the trend for a successful trade and grow their investment.