Walking Through Your First Trade

One trade, start to finish, with every number written down before the order goes in. The trade itself is unremarkable on purpose — the point is the sequence, which is the same whether the account is $500 or $500,000.

Writing the plan down first

A plan written after entry is a story. Written before, it is the only thing that tells you later whether the trade was bad or merely unlucky — and those need opposite responses.

Five lines, before anything is clicked:

1. What and which way. EUR/USD, long.
2. Why. Price has held 1.0780 twice and is turning up from it again.
3. Where it is wrong. Below 1.0765, the idea has failed. That is the stop.
4. Where it is right. 1.0865, the level that rejected price last week. That is the target.
5. What it costs to be wrong. 1% of a $1,000 account, so $10.

Sizing from the stop, not from the balance

Position size is not a decision. It is the output of the three numbers already written down.

$10 / (35 x $10) = 0.0285 lots, which rounds down to 0.02.

The whole trade, before it is placed:

Note the last line. The position ties up $21.60 of a $1,000 account — about 2%. An account that needs most of its balance as margin is holding a position too large for it, whatever the leverage allows.

Placing the order

Now, and only now, the platform. The order ticket needs the numbers that are already written down, which is the point of writing them down.

1. Pick the pair and the size. 0.02, typed in, not nudged with arrows.
2. Choose the order type. Taking 1.0800 as it trades: market order. Waiting for a dip to 1.0780: buy limit. Lesson 7 covers which expresses which intent.
3. Attach the stop and the target on the same ticket. Not afterwards. A stop added later is a stop that sometimes does not get added.
4. Check the ticket against the plan before confirming. Size, stop, target, all three.

What normal looks like once it is open

The position opens slightly down, by the spread. On 0.02 lots with a 1-pip spread that is $0.20. Nothing has gone wrong.

Then it sits there. Most of a trade is waiting, and the plan has already answered the two questions worth asking while you wait — where it is wrong, and where it is right.

Closing, and what to record

The trade ends one of three ways: the stop, the target, or you closing it because something in the reasoning changed. The third is legitimate, but it needs a reason you would have accepted beforehand — not discomfort.

Suppose the target is reached at 1.0865. That is 65 pips at $0.20 a pip on 0.02 lots: $13.00, less about $0.20 of spread.

Then record it, while you still remember the reasoning:

That last line is worth more than the profit. A winning trade taken outside the plan is a problem being rewarded, and it will be repeated. A losing trade taken inside the plan is a cost of doing business, and it should be.

R is the trade's result divided by what was risked: $13.00 over $7.00 is 1.86R. Recording results in R rather than dollars makes trades comparable across position sizes and pairs, and it is the unit Track 5 uses throughout.