Step #5- Personalizing your Plan
Building your own trading plan
IT IS NOT ENOUGH TO SAY, "I WILL JUST TRADE NEXGEN'S PLAN." Technically you will, but you must rewrite it and make it your own plan if you really want to win. TRUST US; this is where most new traders fail from the word go. They fail to make the Nexgen rules their own by putting in the effort to research the historical results. While this sounds simple, without the personal ownership, deep understanding, and intimate knowledge of what entries and exits fit your own personality and skillset, you will find it difficult to be consistent. Until you have historically found hundreds of YOUR TRADES, tracked the stats, and know what the odds of winning and losing will be. Until you commit and take this step seriously do not trade live money. I do not mean to sound negative; this is positive. Building your plan gives you the trust it takes to put your hard-earned money at risk time and time again. When you understand that your plan wins more than it loses, you will have the ability to execute your trading plan without fear of 1 particular trade failing to win. You understand and accept that any trade may win, any trade may lose; that, combined with consistently executing a plan will allow you will reap the benefits the Nexgen Trades create.
You will see other traders winning every day. They have the same software and had LESS education than you have today. Today Nexgen's education is better than ever! Those who have completed the planning process will make money with ease in our chat room. Conversely, those who do not follow their own version of a plan will be wearing a BIG RED X (figuratively) that says, "I have not committed to a plan" Spend a day in the live room and see the winners and losers. When they post winners, you will see that John Novak, who runs the room, knows which trades different traders take. He can tell the users the exact prices they entered. The winners are always consistent, but they do not all trade the same way. They do what makes them comfortable. Some make only trend trades. Some only take trend trades and HVA trades. Some traders will take edge trades only on bigger charts. Some do market flow only trades. Other traders will do counter-trend trades. Counter-trend trading is not advisable for new traders. So this is your task, to figure out which trades make you comfortable. Do not try to do what anyone else does. Instead, do the trades that make you comfortable. At Nexgen, we continually stress this key idea.
Plan creation using Nexgen’s trading setups is acceptable. Please take the time to make them your own. Treat this as if starting a business. A trader must assemble their own version of a plan in written format.
Start with desired financial goals and objectives. How much money do you want to make? While this sounds simple, a million dollars a month, right? You have to be realistic and break it down into bite-sized chunks. This is why we use the $400 per day target. $40 per day target if you are using Micro contracts. If you cannot make money with 1 micro, you should not trade larger-sized contracts. *NOTE: when opting to trade micro futures, do your analysis on the "big" contract. Set up one tiny chart for executing the micro-futures. This will allow your analysis to be generated by those market participants with enough money to dictate the market.
An Example start would be
FINANCIAL CONSIDERATIONS/ LIMITATIONS: DAILY GOAL: to make $300-600 per contract (P/C) daily. DAILY MAX LOSS: $400 - trailed from highest profit achieved intraday. If reached, then stop trading now! Spend time analyzing all trades with pictures for correct application. Fill in the trade tracking spreadsheet.
  • Define the maximum loss per contract per trade. Most trades will use $100 to $150 maximum risk per trade. Entry locations strongly impact the risk and stop placement.
  • Define profit targets- i.e., $200 & $400 targets on very high probability trades. $100-$150 as the first target, move stops to break-even when taking medium probability trades. SEE MANAGEMENT PAGE
  • Max loss per day. If $0 profit then down $400 p/c (per contract) - stop for the day.
  • If up to $200 profit then down $200 p/c stop for the day - notice it is a $400- trailing stop from highest equity per day. It is not ok to be up 200 and then lose $600.
  • Fine-tune these examples to fit your own personal trading style and risk tolerance.
What markets do you want to trade? Can you trade from 9 am -12 noon? 5 am - 9 am? Evenings or weekends? You may say, "I like futures during the day and crypto in the evenings and weekends." Everyone is different. STOCK TRADER WARNING: do not trade stocks while learning Nexgen. The stock market challenge at first comes from the chart sizes to use can vary dramatically. This inconsistency is not ideal for new traders to learn consistency. This is because you will have to constantly change and update your charts to keep up with splits or explosive growth. Apple may trade at $550 one day, then split the next day, and be at $90. After you have had software for some time, you will know how to do this. Not while you are learning the trades.
Conversely, Futures, Crypto, and Forex underlying price structure never changes. You can trade the same charts with Crude Oil if it is at $20 or $120. We have traded the same relative chart sizes for 20 years. This is the same with forex markets like EURUD or cryptocurrencies like bitcoin or Ethereum. Your charts today will be good next year. When building a plan, consistency is vital, and trusting your chart size is an important building block in the trust process. Trusting that what you study now will be good forever is important.
Now you must define every entry rule, exit rule, and every management situation. As a general rule of thumb, most traders say and intend to start trading TREND TRADES, which Nexgen also recommends. You can not just say, "I am taking trend trades." and have a complete plan. REVIEW THIS TREND TRADE PAGE. Learn the rules, then after you have rewritten them, they will be your rules.
This look is generally considered the best possible A+ #1 trend trade. Every indicator looks perfect to take trend trades. This look included STRONG 13-2 and STRONG 8-range triggers. Start with a look like this and then work your way through the other trades is usually a great start.
what is the look of "MY" best trend trade rules?
You need to open a word document and rewrite everything from A-Z. Over the years, we have found that traders who disassemble and reassemble the Nexgen trading rules into their own words develop a deeper understanding of the concepts. You do not have to "create the rules" or develop anything different than what Nexgen teaches; you must make it yours.
The plan does not have to be lengthy. The shorter your plan, the easier it is to follow. Initially, you should include pictures of the trades in the plan and include 5-10 examples of each type of trade, long and short. AVOID THE MISTAKE OF USING THE TRADES THAT NEXGEN HAS ANNOTATED IN THE PLAN! THEY ARE OURS! FIND YOUR OWN WHILE DOING REPLAY! THEY WILL BE YOURS! While hunting for the correct trades, the correct management, combined with writing the rules in your own language, you will be teaching your brain to quickly and accurately see the right trades.
Remember, studying historical trades and using market replay will directly impact the speed at which you memorize the correct patterns. Will you trade for 3 hours? Will you go to work, come back and replay the day? Every day should include 3 things, trading, replay trading, and chart study. This should be done in a very focused way, looking for one or two very particular setups.
If you wish to share your plan for feedback, please do so after filling in your trade tracking sheet with at least 20 simulated trades that you have done during the day or on replay.
The CME Group provides some direction on a trading plan that new traders find useful. Check out the information below. (not an endorsement by CME GROUP of Nexgen software services) just great info!
Building a Trade Plan - CME Group
Copy link