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💹 Series 8: Mastering Technical Analysis

Day 7: How to Build a Simple Technical Trading Plan

The Step-by-Step Blueprint Every Beginner Needs

When I first started trading, I used to jump into the markets without a clear plan.
I bought because I “felt” it was the right time.
I sold because I panicked.
And guess what? I lost money again and again.

It wasn’t because I was stupid or unlucky.
It was because I had no system.
No structure.
No plan to guide me when things got emotional.

Over time, I realised something important:
Trading is not about prediction. Trading is about preparation.
Once you have a simple trading plan, you stop reacting to chaos.
You start following rules.
And rules protect your money.

Today, I want to teach you how to build a simple technical trading plan anyone can follow.
Nothing complicated.
No confusing formulas.
Just a clear, step-by-step approach that removes guesswork and gives you confidence.

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Why You Need a Trading Plan

A trading plan is like a GPS.
Without it, you may still reach your destination, but you’ll get lost many times.
With it, every move has a purpose.

A trading plan helps you:

• Know when to enter

• Know when to exit

• Know how much to risk

• Know what to do when things go wrong

• Know how to stay calm under pressure

Even professional traders rely on plans.
They don’t trade on emotions.
They trade on rules that they trust.

A good trading plan does not make you perfect.
But it makes you consistent.
And in trading, consistency is the difference between winning and losing.

What Makes a Good Technical Trading Plan?

A strong trading plan is made of five simple parts:

1. Your Trading Goal

2. Your Trading Setup (What you look for on the chart)

3. Your Entry Rules

4. Your Exit Rules

5. Your Risk Management

Once you put these five pieces together, you have a complete system.
Not just random ideas.
But a real plan you can follow every day.

Let’s go through them one by one.

1. Set Your Trading Goal

Before you place a single trade, you must know what you want.
Are you trading for long-term growth?
Are you trading to build a side income?
Or are you trading just to learn?

Your goal decides your approach.

Here are the three most common goals:

• Short-term trading: Holding positions for days or weeks.

• Swing trading: Holding positions for a few days to catch short-term trends.

• Long-term position trading: Holding for months while following long trends.

You don’t need to choose something complex.
Just choose what fits your lifestyle.

If you work full-time, swing trading might be better.
If you like studying charts every night, short-term trading might suit you.
If you want minimal stress, long-term trend following is ideal.

Your trading plan must match who you are.
Not who others want you to be.

2. Choose Your Trading Setup

Your trading setup is the specific pattern or signal you look for before entering a trade.
This stops you from trading randomly.
Instead of guessing, you wait for your setup to appear.

A beginner should stick to one or two simple setups.
Here are the easiest ones to learn:

Setup A: Bounce From Support

The stock drops to a known support area and begins to rise.
This often gives good risk-to-reward.

Setup B: Breakout Above Resistance

The stock breaks above a strong resistance with strong volume.
This setup shows strong momentum.

Setup C: Moving Average Trend Trade

Price is above the moving averages and pulling back slightly.
A rebound shows the trend is continuing.

Setup D: RSI Oversold Reversal

RSI dips below a low level, then rises again.
This signals buyers returning.

Choose one setup you like.
Learn it well.
And wait for it patiently.
Professional traders don’t trade everything—they trade only what fits their setup.

3. Create Clear Entry Rules

Entry rules tell you the exact moment to open a trade.
These rules keep you from entering too early or too late.

For example, if your setup is a breakout above resistance, your entry rule might be:

• Enter only when the price closes above resistance

• Strong volume must confirm the breakout

• Enter on the next candle if there is no big pullback

Here are simple examples of entry rules you can copy:

Entry Rule Examples:

• Enter only when price bounces off support with a strong bullish candle.

• Enter only when moving averages are aligned upward.

• Enter only when RSI rises from oversold levels.

• Enter only when volume supports the move.

Your rules should be as clear as traffic lights.
Green means go.
Red means wait.

When you follow rules, you won’t get fooled by emotions or fake movements.

4. Create Clear Exit Rules

Most beginners only think about entering trades.
They forget the most important part: when to exit.

Without exit rules, you may take profit too early or hold losses for too long.
Exit rules remove the emotional guessing.

There are two types of exits:

A. Exit When You’re Wrong (Stop Loss)

A stop loss is your protection.
It tells you when the trade is no longer valid.
Your stop loss could be:

• Below support

• Below a moving average

• Below a recent swing low

• When RSI breaks certain levels

A stop loss is not a sign of failure.
It’s a sign of discipline and survival.

B. Exit When You’re Right (Take Profit)

You also need rules for taking profit.
A common method is risk-to-reward.

Example:

• If you risk $1, aim to make $2 or $3.

• If your stop loss is 5%, aim for 10% to 15%.

You can also take profit when:

• Price reaches the next resistance

• RSI becomes overbought

• Price hits a channel top

• Volume weakens during an uptrend

A good exit rule locks in gains and protects you from greed.
Remember, profits are not real until they are taken.

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5. Risk Management: Protect Your Capital

Even with a great plan, you will still have losing trades.
That’s normal.
Every trader loses.
The difference is how you manage risk.

Here are simple rules to always follow.

Rule 1: Never risk more than 1–2% of your capital per trade.

This prevents one bad trade from destroying your account.

Rule 2: Always use a stop loss.

No exceptions.

Rule 3: Don’t overtrade.

Stick to your plan.
If your setup isn’t there, do nothing.

Rule 4: Don’t chase price.

If you miss the entry, wait for the next trade.

Rule 5: Keep your position size small when learning.

Small size = small losses = calm mind.

A trader’s job is not to win every trade.
It’s to protect their capital so they can keep trading tomorrow.

Putting It All Together: A Complete Simple Trading Plan

Let me show you an example of what a full trading plan looks like.
You can copy this structure and personalise it.

📌 My Simple Swing Trading Plan (Sample)

Goal:

Capture short-term trends lasting several days to weeks.

Trading Setup:

Breakout above resistance with strong volume.

Entry Rules:

• Price must close above resistance

• Volume must increase

• Moving averages must point upward

• Enter on next candle if price stays above resistance

Stop Loss (Exit When Wrong):

• Stop loss slightly below previous support

• Or stop loss below breakout zone

Take Profit (Exit When Right):

• Aim for 2:1 or 3:1 risk-to-reward

• Or exit near the next resistance zone

• Or exit when momentum weakens

Risk Management:

• Risk only 1% of account per trade

• Trade only when setup is clear

• No trades during major uncertainty

• Review results weekly

This is how a trading plan looks.
Clear.
Simple.
Specific.

When you create your own plan, you’ll feel more confident.
You’ll make fewer emotional decisions.
And you won’t rely on guessing anymore.

The Power of Having a Trading Plan

A trading plan protects your mind.
When you follow it, you no longer get shaken by market noise.

No more:

• Panic buying

• Panic selling

• FOMO

• Overthinking

• Regret

• Confusion

A plan forces you to act like a disciplined trader, not a gambler.

Even if you lose, you lose with control.
Even if you win, you win with clarity.

With time, your plan becomes sharper.
Your confidence grows.
And trading becomes a skill you can rely on.

Common Mistakes Traders Make Without a Plan

I’ve seen many people fail, not because they’re bad traders, but because they refuse to follow a plan.

Here are the most common mistakes:

• Entering trades too early

• Exiting too late

• Trading because they’re bored

• Ignoring stop losses

• Taking huge risks

• Changing strategies every week

• Trading based on news hype

• Using too many indicators

A good plan eliminates these mistakes.
It becomes your anchor when emotions rise.

Your Trading Plan Should Fit Your Personality

Some people like fast trades.
Some prefer slow trades.
Some want low stress.
Some enjoy analyzing charts.

Your trading plan must match you.
Not your friend.
Not a YouTuber.
Not a random “guru.”

When your plan fits your personality, trading becomes natural.
You won’t feel forced.
You won’t feel stressed.
You’ll feel in control.

How to Start Building Your Plan Today

You don’t need perfection to begin.
Start simple.

Here is what I want you to do today:

Step 1:

Choose one trading setup.

Step 2:

Write three entry rules.

Step 3:

Write two exit rules.

Step 4:

Decide how much you will risk per trade.

Step 5:

Test your plan for the next 30 days.

That’s it.
Don’t complicate things.
Don’t try to create a “perfect” plan.
The best plan is one you can follow.

Final Takeaways

Here’s the biggest lesson I want you to remember:

A simple plan you follow is better than a perfect plan you ignore.

Trading is not about being right all the time.
It’s about being disciplined, patient, and consistent.
Your trading plan gives you this foundation.

Start small.
Stay consistent.
Refine your plan over time.

Every great trader you admire today started with a simple plan just like this.
You can do the same.

📢 Call to Action

Before the next lesson, I want you to take action:

👉 Sit down for 10 minutes.
Write your first trading plan.
Keep it simple.
Follow it for at least one month.

If you can commit to that, your trading skills will grow faster than you imagine.

You’ve completed Series 8 — and I’m proud of you.
Let’s continue building your confidence and mastery, step by step.

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DISCLAIMER

I make no representations, warranties, or guarantees, whether expressed or implied, that the content provided is accurate, complete, or up-to-date. Past performance is not indicative nor a guarantee of future returns.

I am an individual content creator and not regulated or licensed by the Monetary Authority of Singapore (MAS) as I do not provide investment services.

All forms of investments carry risks, including the risk of losing your entire invested amount. Such activities may not be suitable for everyone. You are strongly encouraged to seek advice from a professional financial advisor if you have any doubts or concerns.