Forex Trading Routines: Make a Daily Forex Trading Routine to Improve your Trading Skills
Your forex trading routine is potentially the most important part of how you trade. It involves your routine before, while and after trading.
Having a forex trading routine helps you reduce mistakes my making you consistent in how you trade.
Of course, all of us are different and that is reflected in the different ways we trade.
But whatever you do, don’t make a habit of just rolling out of bed, skipping breakfast and a shower and starting to trade!
In this article, we’re going to look at why it’s important to have a forex trading routine and how you can put one together that will work for you.
What is a forex trading routine?
Forex traders have to be disciplined like monks. Forget the images you see of day traders living in mansions having parties, for the large part that’s not the reality.
Your forex trading routine can be broken down into three parts:
- Pre-market routine - what you do before trading.
- In market trading routine - your routine while you’re actually trading.
- After-market routine - what you do after trading.
A trading journal can be very useful when combined with a well-planned trading routine.
By reviewing your trading journal, you can improve your routine; you will be more clearly able to see what works for you and what doesn’t.
Whatever you decide for your forex trading routine, it will not be like everyone else’s though you should be able to consistently stick to it.
When you are consistent, you improve processes and hopefully will become more profitable as you are more able to predict the outcome of your trades.
It shouldn’t be fun; it should be boring! Boring means fewer emotions and fewer surprises.
Tips for getting your forex trading routine right
It takes time to create a forex trading routine, you have to experiment with it and see what works.
Over time you will create one that works for you. Some things may take adjusting to and you won’t get right on the first few attempts.
Arguably, your pre-market routine is the most important part of your forex trading routine as it sets you up for the rest of your day.
Your pre-market routine should probably include a time to wake up that you know will not be difficult for you but still provides you with enough time to get ready for the day.
If you give yourself at least two or three hours to wake up before trading, you may find that you are more refreshed and in a better mood to trade.
The time you have before you start trading should be used appropriately though.
Some traders start the day with exercise before trading. Exercise can get you pumped and has also shown to improve your mental ability.
If you have people that depend on you, such as children, you should ensure that they have everything they need before you start trading.
Make sure there will be no distractions while you’re trading.
You have to remember that if you day trade, the minute you start trading, you might not get a break for hours, which is why you should get your routine right.
The mood you start trading with could be stuck with you for hours and affect your performance.
This will allow you to prepare for what the day likely holds ahead. You should never be scrambling for news when you start trading!
To mitigate the issue of missing the news, some traders may have the news on a screen near them at all times. While it may work for some, for others it might be distracting.
Time for learning and relearning
Some traders may deliberately leave out learning new things on days that they know they will be trading or at least in the mornings.
This is because it may be a distraction to them, and they may feel it will impact how they trade.
Other traders may dedicate a set amount of time in mornings before they start trading to go over the basics or concepts they know they forget, to keep them fresh in their minds.
Whatever your pre-market routine includes, it should definitely involve eating breakfast and waking up properly!
In market trading routine
Depending on where you live, you might change your routine to trade in certain markets.
For example, London is largely considered an important city for forex trading and, perhaps more importantly, the London trading session overlaps with the Tokyo trading session in the morning and the New York trading session later in the day meaning there is a lot of volatility to take advantage of.
If you live outside the UK, you may change your working hours to take advantage of this. However, such a change in lifestyle requires a lot of motivation and will not work for everyone!
Preparing to trade
If you’re a swing trader or if you left a position open from yesterday, one of the first things you should do is check the positions you left open.
If necessary, also look into making any adjustments to your open positions.
Also, you can spend some time before you start trading to review your trades from the day before as a quick exercise to see what went well and what didn’t and how you can improve today.
Additionally, you should have an idea of where the market is likely to go and where you will be able to enter and exit, and how much you will be able to make.
Analysis of the market should always be done before you enter a trade!
Traders should be disciplined. They should be looking to trade less, not more.
If you sense that you have too much energy rushing through you, stop and find a release for that energy that’s away from your trading platform.
Plus, remember to give yourself a break!
Don’t think you can trade all day long without one. On some days, with the right amount of motivation, this could be possible, but for most of us on most days, you will need a break.
Though it should be said there will be some points where it will be hard to have a break because there are too many opportunities coming at you.
In cases like this, it may be beneficial to continue trading, but a break is still necessary, and you should make sure you have one.
If you find that this happens often and you usually miss your chance to take a break, you can start saying to yourself that between a certain time, let’s say 12 pm and 3 pm, you will take a one hour break.
You can also set yourself a time to revisit the news after taking a break to ensure you haven’t missed anything.
While the morning part of your forex trading routine is probably a lot more important than the rest of your routine, what you do after trading will affect how you start the next day.
In the end, becoming a professional forex trader requires a lot of discipline and you should have a cut-off time to stop trading.
While it may feel like you are missing out on opportunities, if you are not mentally prepared for the next day, then you will certainly miss opportunities tomorrow.
Remember, forex trading is not about making millions in one trading session, it’s about making a stable income over a period of time!
Ending your day
At the end of the day, analyse how the market performed and how your trades went. See if there are any immediate insights for improving your trading strategy.
You can also dedicate a set amount of time at the end of the day to learn more about forex trading. Further to that, you can also dedicate a set amount of time to try new things.
Your routine should also include days when you don’t work.
You may involve trading-related activities when you are not trading, or you may find that it is better to do nothing related to trading when you are not working.
Whatever you decide, you have to accept the fact that if you were up all night drinking, for example, and you don’t feel your best the next day, it’s going to affect how you trade.
In such situations where you realise that you are incapacitated, it may just be best to sit out and not trade that day.
If you remember anything from this article, make it these key points.
- Your forex trading routine can be broken down into three parts. Pre-market routine, in market routine, after-market routine.
- Getting your pre-market routine right is perhaps the most important. What you do before you start trading will affect you for the rest of the day.
- Before you start trading, check how the market did the day before. Plus, some time to review yesterday’s trades.
- Your after-market routine will affect how you trade the next day. Prepare yourself for tomorrow!
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