Hello Everyone,
Please explain the difference between these trading terms:
- Trading setup
- Trading plan
- Trading strategy
- Trading system
In order, my understanding (which I follow) is:
a trading plan is writing out on a piece of paper where you are now, where you want to get to at a future date, and how you’re going to achieve it. You pin it up on a wall to keep you focused on your goals…
a trading strategy is compiling a hoped for inclusion into a trading system that is your edge. Pro traders use different strategies for different market conditions.
a trading set up is at the coal face when a trade opportunity is selected, and follows the system process.
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Thank you for the explanation @steve369
Some of the webpages on trading that I had read and the videos I had seen till now seem to vaguely define these terms.
I wish someone on babypips could define them properly.
Have you read the School of Pipsology? Lots is covered there.
It’s not a complete definition of a setup, but it’s an important part - entry.
Exits
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I asked the same question!
Here’s the link to thread you might find it helpful! 
I’m glad you posted this question to be fair.
Although I knew the differences, and had all this in my head, you prompted me to put my “Trading Plan” onto paper and can hold myself to it.
Thanks
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Nothing matches well mapped out strategies! A trading system is what helped me build my statistical database and in case there’s a scope for improvement, I simply pen it out. Backtesting and changing a few parameters is what guides me through my trade.
yea that’s a good move. Also helps to keep you accountable to your actions.
Trading plan and strategy according to me includes all your moves and plan of action according to the market analysis that revolves around the currency pairs you’re trading with, and the platforms you’re using. Trading system meanwhile includes the broker and platform you’ll be using. This is how I understand them. Maybe someone else has different versions of the terms.