A single mistake ought to spell the difference between winning and losing a trade.

This is why it’s vital that you develop the habit of thoroughly planning your orders.

Here are four steps you can comply with to construct good ordering habits:

Identify entry, stop loss, and profit levels

After we’ve made our fundamental and technical analyses, we’ll be geared up to mark our entry and exit levels.

Our entry and income levels don’t have to be set in stone as we adjust to what the market is giving to us, but we have to be firm on our stops; we can use a chart stop, time stop, or volatility quit to determine trade invalidation points.

Once you have your entry and exit levels, you can take a look at your reward-to-risk ratios to see if the alternate is well worth taking on.

Proper position sizing

Proper position sizing is THE single most necessary skill that traders should have. Without it, we’ll end up taking trades that are too big or too small, both blowing out our account or underutilizing a high performing trading method.

Typically, risking a max of 1% of our account per trade is recommended for new traders to keep away from ruin, but that will change as our skills grow.

Using a position size calculator, we can match our best risk per trade together with our entry and exit ranges to give we the genuine number of units that we have to work with.

Of course, we could constantly round them off (as long as we remain within our max risk) to make our trade journaling simpler or if our broker isn’t flexible with their position size offerings.

Type of order

The term “order” refers to how we will enter or exit a trade. Be certain that we understand which sorts of orders our broker offers.

As traders get more experienced, more sophisticated trade management tools such as good ‘till canceled (GTC), good for the day (GFD), one-cancels-the-other (OCO), and one-triggers-the-other (OTO) need to be thrown into the mix (if a broker provides them) to better manage a position while we’re away from the computer.

Make sure weread up and practice using them A LOT before going live with them.

Monitoring our trade

Our involvement in your trade doesn’t stop with placing orders. Whether we’re a day, swing, or position trader, we have to keep close tabs on price action and market drivers to see if our initial trade concept has been invalidated.

Check the economic calendar frequently and read market news updates to see if the vital story or market sentiment is changing.

With time and experience you’ll research to identify which reports are just noise and which ones require trade adjustments.

What’s vital is that you discover a balance between being flexible to the changing market prerequisites and sticking to our original trading plan.

Remember that perfection in overall performance isn’t a ideal win percentage–it’s about doing all the right things, the right way, at the proper time and avoiding as many mistakes as possible.

So strive to make a habit of precisely placing our trade orders and double-checking them each and every time. The forex market is unpredictable enough; don’t make it harder on ourselves to be profitable with execution mistakes!