Forex Trading Guidelines › Guideline 11
The 9-Part Forex Strategy Framework
The 9 Parts, Defined
| # | Part | The question it answers |
|---|---|---|
| 1 | Market | Which instrument(s) exactly — EURUSD only, or all majors? Gold? Indices? |
| 2 | Timeframe | Entry timeframe and higher timeframe for context (e.g. enter M15, context H1). |
| 3 | Market context | Trend, range or breakout regime — and which session hours qualify. |
| 4 | Setup | The exact pattern/condition that must exist (pullback to level, breakout of range...). |
| 5 | Entry trigger | What precisely fires the order — a candle close above X, a touch of Y? |
| 6 | Stop-loss rule | Where the setup is invalidated — a fixed distance, or a structure point? |
| 7 | Exit / target rule | Target, trailing method, time exit, or signal-based exit. |
| 8 | Risk per trade | Fixed % (0.5-2%) and the resulting lot size rule (Guidelines 1, 16). |
| 9 | No-trade conditions | News blackout, daily cap hit, no signal, wrong session — the "when NOT to trade" list. |
Worked Example: A Complete 9-Part Strategy
Here is a finished example you can copy and adapt:
Now test it: two traders following this document should enter at the same price, or not at all. That testability is the entire point of the framework — it is what separates a strategy from a feeling.
Why 9 Parts, Not "Just a Setup"
- Measuring requires rules: you cannot journal a result in R (Guideline 12) without parts 6 and 7 defined.
- Backtesting requires rules: a 9-part strategy can be coded and tested on historical data; a "setup + gut feel" cannot.
- Discipline requires rules: the pre-trade checklist (Guideline / Checklist) checks parts 2-6 and 9 before every entry — it needs your strategy written to work.
- Automation requires rules: an EA (Guideline 18) is literally your 9 parts in code. If you cannot write the 9 parts, you cannot write the EA.
Build Around the Framework
FAQ
What makes a good forex trading strategy?
A good strategy is fully defined (all 9 parts), objective (two traders reach the same decision), survivable (risk 0.5-2%, stops mandatory), and measurable (journaled in R so expectancy can be computed).
How do I write my first trading plan?
Answer the 9 framework questions in writing: market, timeframe, context, setup, trigger, stop, target, risk, no-trade conditions. Then journal 100 demo trades against it before risking real money.
What is the difference between a setup and a strategy?
A setup is one part (the pattern). A strategy is the full decision system: context, trigger, stop, target, risk and no-trade rules around that pattern. Most beginners trade setups and call it a strategy — that is the 90% failure pattern.
Can I automate a 9-part strategy?
Yes — that is exactly what an Expert Advisor is: your 9 parts expressed as code, with extra safeguards for spreads, slippage and connectivity. See the EA guidelines page for the automation rules.
Choose the next useful step
Most visitors arrive with one question: build, test, price, or trust. These shortcuts keep the path practical.