Trading strategy and system in the market
In the global expanse of the Internet now, as opposed to just 5 years ago, a lot of information about trading on the market . We also see a lot of trading strategies and tactics. Very often the rules for opening a trading position are called differently: both tactics and strategy and system on . However, there is still a difference between these concepts. Let us discuss this question.
Trading system
So, trading system includes answers to global trading questions, such as the choice of trading instrument, time interval, trading session. The trading system defines a set of analytical tools: indicators, analytical constructions, news data, etc. It also concentrates the general principles of trading strategy: trading along the trend, in the channel, in the flat, capital management strategy, protection of open positions, etc.
Trading strategy
Trading strategy on is primarily a set of rules and criteria for entering and exiting a trade in the market. It is within the framework of a trading strategy that we look for indicator signals, analyze candlestick combinations, analyze the news feed, etc. Also the trading strategy provides transaction support: installation of StopLoss and TakeProfit, transfer of stops to break-even, use of trailing stop, etc. Trade support is directly related to another component of trading tactics - risk management or money management. Risk management is aimed at limiting of trader's losses by all means. It includes transfer of positions to Breakeven, use of trailing stopWe are not going to use the same method, but we are going to use the same method to reduce the risk of losing the deposit.
As you can see, trading strategy - is only an element of the system, which certainly deserves great attention, but by itself is not yet sufficient for successful trading. When trading, it is necessary to see the whole picture, and therefore it is necessary to have and trading system.