YT YouTube2Text

YouTube2Text → Transcripts → Market Mechanics Ep 16: Building a Trading Plan

Market Mechanics Ep 16: Building a Trading Plan — Transcript

by Brad Goh (The Trading Geek) · 5,213 words · 803 segments · language en · Watch on YouTube

Open in transcriber Summarize with AI Download SRT/VTT

Full transcript

0:00Ladies and gentlemen, welcome to how to
0:02build a trading plan 101. Professor
0:05Brett here. And today that's what I'm
0:07going to be discussing. I'm going to
0:08show you how to build a trading plan,
0:10and I'm going to build it with you live.
0:13Right, so here's the problem. Most
0:15traders do not fail because they lack
0:17effort. They fail because they do not
0:19have a clear, repeatable plan. What I
0:21basically mean by that is that they open
0:23the charts, they see the candlesticks
0:25doing this, and then they start to
0:26improvise, they start to enter for a
0:28buy, and then they just react
0:29emotionally. So price up, they enter for
0:31a buy, price goes down, they enter for a
0:33sell. Big bullish candlestick, they
0:35enter for a buy.
0:36And to me, that's not trading. That's
0:39gambling. The reason why it's gambling
0:41is because you don't have any structure
0:44built into your trading. So as a result,
0:47your results are going to be chaotic.
0:49Just think about it. How can you be
0:51surprised when you are inconsistent with
0:53your profits when the way you've been
0:56executing your trades is inconsistent?
0:58Sometimes you're entering here,
0:59sometimes you're entering there. You
1:01don't have like a structure. You don't
1:03have like a systematic framework that
1:05decide your decision-making.
1:08All right, so that's what we're talking
1:09about in this lesson. And this is a
1:11tweet that I've written. If you cannot
1:13explain a trade plan simply, you cannot
1:15execute it consistently.
1:17And if you cannot execute it
1:19consistently, you will not get
1:21consistent results.
1:23Remember, the goal is not to sound
1:25smart. The goal is to be consistent.
1:29So before I show you how to build a
1:30mechanical trading system or a trading
1:33plan inside Edge Flow, I want to talk
1:35about the theory behind it. Right,
1:37because if you do not understand why a
1:39trading plan
1:40matters and what it actually is, then
1:44building one just becomes a waste of
1:45time. Okay? So
1:48remember, your trading plan, this is not
1:50just a random document. This is the
1:54thing that will actually help you make
1:56the same quality of decision again and
1:59again regardless of how you feel.
2:01Regardless of whether you feel greedy,
2:03whether you are
2:05feeling the fear or impulse or any sort
2:08of other emotion, whatever.
2:11My favorite quote which I repeat all the
2:12time during my live trading session is F
2:15your emotions. Plan the trade, trade the
2:17plan.
2:19That is what this lesson is really
2:20about. Right? So, what actually is a
2:22trading plan? A trading plan is simply a
2:25set of rules that tells you what kind of
2:28market to trade, what conditions needs
2:31to be present, where you enter, where
2:33you exit, how you manage risk, and what
2:36trades are not worth taking.
2:38That's it. It doesn't need to be
2:40complicated, right? It just needs to be
2:42simple. It just need to lay out all the
2:44rules that you need to follow
2:47every single day.
2:49In fact, the more complicated it is, the
2:51harder it is to follow it under
2:55pressure. Just think about it. When
2:56you're emotional,
2:58and then you go on to your trading plan,
3:00you realize that there's like 10 pages
3:02and it's filled with a lot of jargon and
3:05fluff.
3:06Now,
3:07you won't even feel like going through
3:08that trading plan anymore.
3:10Right? You've just set yourself up for
3:11failure when you make it too complicated
3:13or too difficult.
3:15So, yeah, keep things simple. That's
3:16just my philosophy. I fundamentally
3:19I fundamentally believe that simplicity
3:21is the highest form of intellect. All
3:23right? That's it.
3:25A good trading plan is not supposed to
3:27be impressive because it sounds
3:29advanced.
3:31A good trading plan is impressive
3:33because it is clear enough to execute
3:35consistently.
3:37All right? So, here's why most traders
3:39struggle. A lot of traders out there,
3:42they think that they have a strategy.
3:44But what they really have is a loose
3:47collection of ideas.
3:49They have some concepts in their head,
3:51all right? They they know all the
3:52blocks, they know supply and demand
3:53zones, they know candlestick patterns,
3:55they know chart patterns. Maybe they
3:57have some screenshots that they save on
3:58the phone or maybe like a PDF locked
4:01somewhere. Things that they kind of look
4:03out for.
4:04But here's the thing.
4:06When the market starts moving live
4:09in real-time market condition
4:11speed matters the most.
4:15All right, if you don't know exactly
4:17what you are looking for
4:19every single move looks like a trade
4:21that is worth entering.
4:24Right, everything starts falling apart
4:25because now you're like, "Hmm, should I
4:27enter here? Should I enter there? Maybe
4:29I should stay out. Maybe I should just
4:30wait a little bit more." Da da da da you
4:32know, all of this stupid um inner voice
4:35just start to cloud your judgment.
4:38Anything that is not clear becomes
4:39emotional when money is on the line. So
4:42if you don't have a structured
4:43decision-making
4:45you're pretty much telling the market,
4:47"Hey, I'm just going to donate my
4:49hard-earned money to you."
4:51Because
4:52when I get emotional
4:54I can't do All right, I don't have
4:56a trading plan to ground me. I'm just
4:58going to donate my hard-earned money to
4:59you. So that's what happens when you
5:01don't have a trade plan, all right?
5:03As a result, you force entries, you
5:05hesitate, you move your stop losses, you
5:07cut winners early, you do all of these
5:09stupid trading mistakes and just take
5:12unnecessary losses.
5:14Plays the big games, wins the big
5:15prizes. That's it.
5:19A weak plan creates emotional execution.
5:22A clear plan creates repeatable
5:24execution.
5:27All right, remember that. If you don't
5:29have a trading plan or you have a weak
5:30trading plan, what tends to happen is
5:32that
5:33emotions
5:35just have more power over you. It just
5:37make it more easier for emotions to take
5:40control of your decision-making.
5:43So yeah, save yourself some time and
5:45money by creating a robust and proven
5:48trade plan.
5:50Now,
5:52remember,
5:53our job as traders is to allocate
5:56capital wisely.
5:58That's right. It's not to, you know,
6:01make the most amount of money. That's
6:03our goal, but that's not our job. Our
6:06job is to allocate capital wisely
6:09because you only have a finite amount of
6:11capital.
6:13You only have 100k in your account, 10k
6:15in your account, 1,000 bucks in your
6:16account.
6:17Which means that you need to make sure
6:19that you're spending it wisely.
6:21You need to make sure that you are
6:23actually deploying it on the setups that
6:25are actually worth taking.
6:29Right? This means that your trading plan
6:30should decide which trades are worth
6:32risking on, which ones are not, when to
6:35participate in the market, and when to
6:37stay out.
6:39Your plan will be able to protect your
6:40capital from low-quality decisions. You
6:43should be able to know what define an A+
6:46setup, what define a B setup, and a C
6:49setup. And you only want to make sure
6:50that you're deploying your capital on
6:52the A+ setups.
6:55So, a mechanical system is not about
6:57being robotic. It's about removing
7:00unnecessary emotion.
7:03It tells you what to look for, what must
7:06be true, what invalidates the setup, how
7:08to manage the trade, and how to review
7:10the system.
7:12A mechanical plan turns trading from
7:15vibes into data.
7:17That's the power of a mechanical plan.
7:21Right? So, once again,
7:24just understand that you need to have
7:25one and you need to keep it simple.
7:28Right? Because the reason why it needs
7:29to be simple is because you need to
7:31apply it in real time without confusion.
7:34But when there's confusion, when your
7:36trading plan is 10 long, what
7:38tends to happen is that, like I said,
7:39emotions take over.
7:42Okay? So, the purpose of a mechanical
7:45trading system is to remove all the
7:47discretion from trading. It's to remove
7:49all the unnecessary emotion from
7:51trading.
7:52So that when you're in the heat of the
7:53moment, there is no room for guesswork.
7:56There is no room for emotion.
7:59There is only room for execution
8:01according to your trade plan.
8:03So, what a trading plan does is that it
8:05literally give you the structure, right?
8:07So, that is what makes it mechanical.
8:10It's something that is clearly defined
8:14and is measurable and is repeatable and
8:17is scalable.
8:20Okay? So, when a trading plan is
8:22actually mechanical, what tends to
8:24happen is that your execution becomes
8:26more consistent.
8:27Which is a huge thing, right? Because
8:29now you're always losing a small amount
8:32of money and then when you're winning,
8:34you're actually making a lot of more
8:35money.
8:36Second thing is that your journaling
8:37becomes much more honest because now you
8:40can actually tell whether a trade
8:41followed the plan or not.
8:43Right? If the trade followed the plan
8:44and you make money, great. This just
8:46give you like an ego boost and you also
8:48give your trade plan a boost. Now you
8:50have data that actually allows you to
8:52trust a trading plan.
8:54Right? Because men lie, women lie, but
8:56numbers don't lie, right?
8:58Thirdly is your review process becomes
9:00much more useful because now you're no
9:02longer reviewing random trades that
9:04you're taking on a Friday night.
9:06You are actually reviewing a system,
9:09right? So, when you actually review your
9:10trades, you're actually reviewing the
9:12effectiveness of the trading system.
9:15And that give you the data you need to
9:18improve that trading system.
9:20So, yeah. That's how important it is to
9:23have like a mechanical trading system.
9:27So, well, before I move on to the next
9:29part which I talk about what should a
9:31good trading plan answer,
9:33I want you guys to adopt this philosophy
9:35which is called plan first, trade
9:37second.
9:39A lot of traders do the opposite, right?
9:41They open the charts, they trade first,
9:43then they try to decide what to do next.
9:45You know, maybe I should like get out
9:47when price comes here or get out when
9:48price comes there.
9:50Professional traders do the exact
9:52opposite.
9:53They decide in advance what they are
9:55willing to do. And then they just wait
9:58for the market to meet those conditions.
10:01So, that's a huge difference, right?
10:02Because one is reactive.
10:05The retail trader is reactive, you know,
10:07he's just trading for the sake of
10:09trading, trading for the sake of
10:10adrenaline, trading for the sake of
10:12excitement, trading for the sake of
10:14making money.
10:15But the professional trader is
10:17intentional.
10:20He knows exactly what he's looking for.
10:23And he knows exactly when not to trade.
10:25He's like a sniper, right? Who is just
10:27focused on taking one good trade and the
10:29next good trade and then the next good
10:30trade.
10:32So, yeah. Plan first, trade second. So,
10:35that when the hits the fan, at
10:37least you're well prepared for it.
10:40And trust me, the always hits the
10:41fan, right? Always.
10:44Yeah.
10:45So, just don't leave any room for
10:47guesswork or emotion. Your plan should
10:49tell you exactly what you're waiting for
10:51before the market even gets there.
10:54If price comes here, I'm going to buy.
10:55If price comes here, I'm going to enter
10:57for sell. And then when price does
10:58eventually go there, all you need to do
11:00is just execute. That's it. You don't
11:02sit there and think, "Hmm, should I do
11:03this? Should I do that? Maybe I should
11:05do this." No, there's no room for like
11:07discretion. Because you have a
11:09mechanical trading system.
11:13All right, so here's what a good trade
11:14plan should do. A good trade plan should
11:16give you the answers to simple questions
11:18just like this.
11:20What market conditions do I want to be
11:21trading?
11:23Is it the bullish market condition,
11:25bearish market condition? Is it when
11:27price is in a continuation phase or a
11:29pullback phase? What makes a setup
11:32valid? Right? Must I get a
11:35my bias and I must I need to ensure that
11:39the lower timeframe trade ideal is
11:41aligned with the higher timeframe trade
11:42bias, must it be located at a specific
11:46supply and demand zone or order block.
11:48Right? What makes a setup valid and
11:50worth taking?
11:51What makes it invalid? Right? So, if
11:53price actually comes down and break past
11:55this zone, then I'm not going to be
11:57looking for longs anymore because that
11:58pretty much tell me that that one zone
12:00is no longer working. It's no longer
12:02effective.
12:04How do I manage the trade? Right? Where
12:05to place a stop loss? Where to place
12:06your take profit? And most importantly,
12:09when should I stay out completely? What
12:11are the market conditions that I want to
12:13avoid at all class costs just like a
12:15plague? Right?
12:17Maybe on Mondays, right? The market
12:19condition is not ideal. Maybe during
12:21high impact news. Maybe during holiday
12:23seasons. Right? So, when should I stay
12:26out completely?
12:27If your trading plan cannot answer these
12:29simple questions right here, it is not
12:32strong enough.
12:34You need to go back to the lab and just
12:36make it even stronger.
12:39Yeah.
12:40So, that's trading plan. And Okay,
12:43here's a common misconception. A lot of
12:46traders think that
12:48in order for you to become profitable at
12:49trading, you just need to be
12:50disciplined. Right? So, discipline means
12:52forcing yourself to do hard things.
12:54But what they fail to realize is that
12:56discipline actually becomes a lot easier
12:58when the plan is clear.
13:01So, when you have a trading plan, you
13:03actually don't really need to be super
13:05disciplined.
13:06You need to be less disciplined. Right?
13:08Just think about it, right? The
13:09definition of discipline is to do the
13:11hard things especially when you don't
13:12feel like it.
13:14When you don't have a trading plan, you
13:16have no choice but to try to use your
13:19willpower to try to be disciplined in
13:22the heat of the moment, to try to
13:23control yourself.
13:25But when you have a trading plan, you
13:26have a structure, you know, you are not
13:29negotiating with yourself. You're not
13:31asking, "Should I take this trade? Maybe
13:33this is close enough. What if I just
13:35try this one?"
13:37You already know where you are entering
13:38for the trade.
13:40As a result, you already have the
13:41structure, you already have an idea. You
13:44don't really need to rely too much on a
13:46willpower. All you need to do is just
13:47execute.
13:49That is the beauty of a mechanical
13:50trading system, right? It allows you to
13:52like just not negotiate with the inner
13:56And less negotiation means less
13:58emotional damage.
14:00Means less losses. As simple as that.
14:04With that being said, let's move on to
14:06the next part, which I'm going to show
14:07you how to build a mechanical trading
14:09system live in Edge Flow.
14:12This app is called Edge Flow for a
14:14reason, because it helps your edge flow
14:17into execution. Edge Flow literally
14:20stands for Edge plus Flow. And your edge
14:24in this case is your trading plan. Your
14:27flow is how you execute it on a
14:29day-to-day basis.
14:31And the thing is, most traders, they
14:32have an edge in their head or in a PDF,
14:34but it doesn't translate into consistent
14:37actions. Because sometimes they forget
14:40to look at it, they they forget to
14:41review it, they don't feel like
14:43reviewing it. But with Edge Flow, Edge
14:45Flow turns it into a workflow that you
14:47can follow every single day. Okay? Like,
14:50this app is built in a way where it
14:52connects the whole loop. Plan your
14:55trade, prepare for the session itself,
14:58execute the trade, journal your trade,
15:00review the trade. So your edge doesn't
15:03break when emotions hit. Now, the reason
15:05why I believe having a trading plan is
15:07so important is because I believe that a
15:09trader's job is to allocate resources
15:11wisely. Since we only have a finite
15:14amount of capital in our account, we
15:16only have a limited amount of money. So
15:17we want to make sure that every single
15:19trade that we take is a high probability
15:21setup. And that's where your trading
15:24plan comes in. Your trading plan decides
15:26what trades are worth taking and what
15:28trades are not worth taking.
15:31Let me show you how I build my
15:32mechanical trading system inside Edge.
15:34So, like I said, Edge is just like a
15:36simple trade plan builder. All you have
15:38to do is to come in here, create a plan
15:40just like this, and you just fill up all
15:43of the necessary fields in here. And it
15:45start off by naming the plan. And if you
15:47don't know where to start, feel free to
15:49use the presets that we have right here.
15:51These are proven templates, proven
15:53trading systems for my coaches inside my
15:56mentorship program, the 1% Club, with
15:58over 20 years of combined trading
16:00experience. Right, so we can verify that
16:02these trading strategies, these trading
16:05plans actually work. But yeah, if you
16:07want, if you don't know where to start,
16:09you can check out these templates right
16:10here, but just know that they are uh
16:12simply a starting point, right? You
16:14still have to customize it so that it
16:16suits your trading style, it suits your
16:18trading personality. You adjust it to
16:20fit your risk tolerance. Okay? But
16:22anyways, let's just try to build a plan
16:25live right now. Okay, so first things
16:27first,
16:28put a name right here. Let's call it
16:29Market Mechanics Plan. Right, this is
16:31where you can give a name to the setup
16:34in which you are trading within this
16:36plan itself. Right, so maybe I'd like to
16:38call it the liquidity sweep entry model.
16:41All right, and then this is where you
16:42want to add your charting process. So,
16:45this to me is the most important part of
16:47building a trading plan. It's to de-
16:50termine the bias, right? It's to
16:52identify what's the trend direction,
16:54it's to map out our what point of
16:56interest, it's to determine what is the
16:58location in which we want to enter the
17:00trades from. Right, so that's where
17:02charting process come into play. It's
17:04how you turn a blank chart into a
17:07system, so you know exactly where to
17:10buy, where to sell. That's it, right?
17:13That's the charting process. Right, so
17:15this is where I put like little bit of
17:17top-down process, what I do on a higher
17:19time frame, what I do on a medium time
17:21frame, what I do on a lower time frame.
17:23So, just to give you a quick little
17:24example, you can see like this one right
17:27here on this A+ setup checklist, these
17:30are the steps that I have in my charting
17:32process. All right, if you know
17:34how I trade, you will understand all of
17:36these terminologies. If you don't, you
17:38might want to consider checking out my
17:39YouTube. But yeah, like this is just the
17:41entire charting process which I take
17:45every single time I come onto a blank
17:46chart. All right, I know that okay,
17:48these are the things that I need to do
17:49in order for me to make sense of the
17:50market, in order for me to just build a
17:52narrative on the market. Okay? So, yeah,
17:55the goal of this charting process is for
17:57you to just turn a blank chart into
18:00something you can work with so that you
18:02can develop a trade bias. All right,
18:04that's it. And then this next section,
18:07this is where you can put your entry
18:08criteria. All right, so let's say my
18:11charting process
18:13allows me to mark up this beautiful
18:14supply and demand zone. Okay, now price
18:16has finally dropped into the supply and
18:18demand zone, and now I want to enter for
18:20the trade. But then what's the
18:21confirmation? What's the entry triggers
18:23that I need to see appear in the market
18:25before I enter for the trade? Well,
18:27that's my entry criteria. All right, so
18:29this is where I'll put down the the
18:31things that I want to look out for,
18:32right? The confirmation, the
18:33non-negotiables that must be true before
18:36I even think about pressing the buy and
18:37sell button. And if every or any of
18:41these criteria is not met, I would just
18:43not trade, right? Like that's it. If
18:46even just one of these boxes are not
18:49being checked,
18:50I would still not trade. All right,
18:52that's how important the entry criteria
18:54is to me. I want to make sure that when
18:55I see a setup, it needs to check off
18:57every box within the entry criteria
19:00itself. Yeah, and then below here, this
19:02is where I also paste like some
19:04screenshot of my entry models, right?
19:07Just for me to like remind myself, okay,
19:09this is the setup that I'm looking for
19:12when I come on to a blank chart, and
19:14this is an example of the setup itself.
19:16Yeah, so you can place some chart
19:18screenshots. You can take it as
19:19reference points when you are trading.
19:21And then below here, this is where you
19:23have your trade management rules, right?
19:24So once again, this is something that
19:25you can type. You can literally type
19:28like how you would manage the trade once
19:29you are in the position itself, right?
19:31Whether you are going for set and forget
19:33method, whether you are trailing your
19:35stop loss, whether you are taking
19:36partial profits. If you are trailing
19:38your stop loss, how will you be trailing
19:40your stop loss? If you are taking
19:41partial profits, are you going to be
19:43taking partial profit at 50% or like
19:45100% or whatever? You need to define the
19:47terms in which you want to be managing
19:50the trade itself right here. And then
19:52once that's done, this is where you put
19:53your exit criteria, right? Which is very
19:56very simple. There's only two sort of
19:58exit criteria, to be honest with you.
20:00Number one is
20:02where do you want to exit if the trade
20:04ideal does not go as planned? Right? So
20:07like where do you want to get out if
20:08you're wrong? So this is where you
20:10decide where to place your stop loss,
20:11right? Maybe I want to place my stop
20:13loss at the
20:15low or high of the liquidation candle,
20:19or below my support level, or above my
20:22resistance level, whatever it is, right?
20:25And then another scenario that you need
20:27to think to account of is
20:29where would I get out if
20:31my trade play out in the way I envision
20:33it to play out, right? Like if price
20:35actually goes in my desired direction,
20:37where do I want to get out of
20:39at if I'm right? Okay? So this is where
20:41I perhaps I might say I want to take
20:43profit at the next swing high or the
20:45next swing low. Right? Just like this,
20:47right? This is how you put your exit
20:48criteria on paper. So now you know
20:50exactly where you want to get out when
20:53price goes wrong, when things go wrong,
20:55and things go right, okay? Remember
20:57amateurs focus on entries, professionals
21:00obsess over exits, right? So make sure
21:02you have a very clear ideal on exactly
21:05where you want to get out of the trade
21:07at all times, before you even enter the
21:09trade. And then below here, this is
21:11where you can put some trading notes as
21:12well. For me personally, I like to put
21:15some reminders. I like to put some
21:18philosophies. I I like to put some
21:20quotes in here. Uh and you can also put
21:23common mistakes. You can even put market
21:25conditions that you want to avoid,
21:26right? So, these are kind of like the
21:28rules that you want to follow
21:31to protect you from yourself, right? To
21:33protect protect you from emotions,
21:35right? So, to me, this is just like a
21:36reminder to myself, okay? Yeah, so you
21:38can just put whatever you want in here.
21:40This is fully optional.
21:41And bam, there you have it. Now, on the
21:44right-hand side right here, if you
21:45notice on your trade plan, you will see
21:47your guardrails in here.
21:49So, you don't have the ability to change
21:51your guardrails in Edge itself. If you
21:53do want to modify your guardrails, just
21:55press this button right here, and this
21:57is like the modify guardrails button,
21:59and it will direct you to settings,
22:01right? Where you can change your
22:03guardrails in here. And whatever
22:04guardrails you apply here, it's
22:07universal across every single trade
22:09plan, right? You can see every single
22:11trade plan has the same exact
22:12guardrails, right? So, if you want to
22:13change your guardrails, you can just
22:15press this button right here, and you
22:16will get directed to the settings.
22:18Next up is once you save the trading
22:22plan, it becomes read-only, right? You
22:24can see I can no longer edit the trade
22:26plan. I can check off the boxes right
22:28here right here right right nice, but I
22:30can no longer edit the trade plan.
22:34And this is useful, right? Because when
22:36you are trading,
22:38okay? We have this banner that pops up
22:40every single day that to remind you to
22:43actually review your trade plan. And
22:44this is also part of your pre-market
22:46routine as well, if you actually set it
22:47as that.
22:49So, what happens is that when you press
22:51open trade plan, you can see
22:53this is what you will see, right? You
22:55will be able to review your entire trade
22:57plan that you have set as active inside
22:59Edge. And once you have reviewed the
23:01trade plan, you have went through the
23:02charting process, the entry criteria,
23:03you can just press market's review and
23:05the banner will disappear itself. And
23:07also, when you are trading, if you go to
23:10trade plan right here, you can also
23:11trade with your trade plan right next to
23:14you as well. If you want uh more
23:16guidance, more structure, more support,
23:18right? You can analyze the charts while
23:20you're doing this mapping process, you
23:22can look for your entry models while
23:24you're looking at the reference right
23:25here.
23:26So, that's Edge, okay? And yeah, that's
23:29what happens when you actually set a
23:30plan as active. When you set a plan as
23:32active, it get pinned on the top and
23:34it's literally everywhere, right? On
23:36your trading platform, it appears here,
23:39right in your pre-market routine, it
23:40also appears here, it becomes your
23:42default trading plan. All right, that's
23:44how the the active thing work. That's
23:47how you actually activate a plan. And
23:49also, when you take a trade, right?
23:51Let's say you take a new trade and you
23:52close the position and you go on the
23:54journal, it will automatically tag that
23:57trade as the trade plan that you have on
24:00active, right? So, in that case, you
24:01could saw you could you saw that my
24:03active trade plan was the A+ setup
24:05checklist. And if I come under this
24:06trade right here, you can see, by
24:08default, it always tag it to the active
24:11trade plan.
24:13Yeah, and then you can come into
24:13journal, you can select whether you did
24:15or did not follow your trade plan or
24:17not.
24:18And then, based on this, right? It will
24:21create your plan stats, right? So, if
24:23you go back to the Edge itself,
24:25you can see, this is your trading data.
24:28This is the statistics that we've
24:30compiled based on the trades that are
24:33tagged to this trading plan in the
24:35trading journal.
24:37All right, so like what I've showcased
24:39to you earlier on, on your trading
24:41journal itself, you have the ability to
24:43go to individual trades and just like
24:46tag it to the trade plan that you
24:47follow, right? And check off like
24:49whether you follow all the trading plan
24:50or not. And then, when you do this,
24:52right? When you take multiple trades,
24:54what happens is that when you to to
24:55Edge,
24:56we are able to show you how effective
24:59the trade plan actually is, right?
25:01Based on how many trades you have taken,
25:04what is your win rate while you're using
25:06this trading plan, what is your P&L,
25:08right? How much money you made or lose
25:10while you're trading with this trade
25:12plan, and what is your compliance, which
25:13is did you actually follow your trading
25:16plan or not? Right, because just now, as
25:17you recall, when you go on the trading
25:19journal, you have this check box where
25:21you can tick I follow my trade plan. So,
25:23if you didn't, it will reflect here. If
25:25you did, it will also reflect in this
25:26compliance score right here. Yeah, so
25:29this is simply the percentage of trades
25:30where the required checklist steps were
25:33followed.
25:34So, this requires you to be brutally
25:37honest so that you can actually see how
25:40each one of your trade plan performs.
25:43And when you do this, this allows you to
25:44make data-driven decisions instead of
25:47decisions based on vibe. Instead of
25:49saying stuff like, "Oh, today this trade
25:51plan didn't work, so I'm just going to
25:53switch to this other trade plan. Oh, my
25:55trading guru is trading this plan, so
25:56I'm going to just going to switch to
25:57another plan." No. Now you can actually
26:00make data-driven decisions, right? But
26:04like I said, it requires you to be
26:05honest with your trading journal, right?
26:07You want to make sure that you don't lie
26:09to anybody, right? Because nobody here
26:10is going to be looking at your trading
26:11data other than yourself. Be brutally
26:14honest, grade your trades based on the
26:16trading plan, and this is where you will
26:18be able to like really just see which
26:21are the trading plan that tends to
26:22perform well, which one is just not that
26:25effective, and then you can just double
26:27down on the plan that actually works.
26:30So, yeah, that's it.
26:32As simple as that, right? Like that's
26:33the entire Edge system. That's how you
26:35build a trading plan inside Edge Flow,
26:37and that's how you actually like just
26:39integrate the trading plan into your
26:42entire trading system so discipline
26:45becomes automatic.
26:47So, I just want to say just going to end
26:49off with like a final piece of advice.
26:51When you are creating a trading plan and
26:53you start follow your trading plan, as
26:55time passes, you want to adapt. Okay?
26:59You don't just want to follow your trade
27:01plan blindly. You should treat your
27:02trading plan as a living, breathing
27:05organism rather than a scripture.
27:08Because as the markets evolve, market
27:10conditions change, which also means that
27:13this trading plan will not be as
27:14effective 5 years from now compared to
27:17today. Right? So, as the markets evolve,
27:20you want to tweak it. You want to test
27:22it. You want to adapt it.
27:24Because if you follow the same plan for
27:2550 years without changing anything, then
27:28you are not trading the plan. The plan
27:30is trading you.
27:32Right? So, make sure you evolve your
27:33trade plan as time passes and slowly but
27:36surely just continue to seek to improve
27:40this trading plan. And then, as time
27:42passes, this trading plan will just get
27:44better and better, more and more
27:45bulletproof, and you will start to see
27:47your trading results compound as well.

About this transcript

This page contains the full transcript of Market Mechanics Ep 16: Building a Trading Plan by Brad Goh (The Trading Geek), generated from the public captions YouTube serves with the video. The transcript has 5,213 words across 803 segments, with the original timestamps preserved so you can click any line to jump to that moment in the embedded player.

What you can do with it

Use the transcript to take notes, quote the speaker, build a study guide, generate a summary with ChatGPT or Claude via the YouTube Summary tool, or export it as a timed subtitle file with YouTube to SRT. You can also re-open it in the transcriber to choose a caption track available on the video.

Free YouTube transcript tool

YouTube2Text is a free YouTube transcript generator — no signup, no daily limit. Paste any YouTube link and get the full transcript instantly, with timestamps, click-to-jump, caption language selection, AI prompts for ChatGPT, Claude, and Gemini, and exports to TXT, SRT, VTT, or Markdown.