The Million Dollar Trading Challenge Trading Plan

In this post, we are going to discuss in detail the Million Dollar Trading Challenge Trading Plan. As they say, “Fail to plan and plan to fail.” Before you embark on any endeavor, you should have a firm plan in your mind what you want to do and achieve.

Million Dollar Trading Challenge

Million Dollar Trading Challenge is a sort of trading competition. Anyone can take part in it. The idea is to turn $100 into $1 million in around 12 months. There are many men and women in the world who want to achieve financial freedom and would love to do that. But most don’t have the resources to do that. So we start this Million Dollar Trading Challenge. We start small and try to double our account every month.  If we can do that we will be able to reach our goal of a million dollar in 12 months. Let’s do that maths:

–>1st month we double $100 into $200

–>2nd month we double $200 into $400

–>3rd month we double $400 into $800

–>4th month we double $800 into $1600

–>5th month we double $1600 into $3200

–>6th month we double $3200 into $6400

–>7th month we double $6400 into $12,800

–>8th month we double $12,800 into $25,600

–>9th month we double $25,600 into $51,200

–>10th month we double $51,200 into $102,400

–>11th month we double $102,400 into $204,800

–>12th month we double $204,800 into $409,600

–>13th month we double $409,600 into $819,200

–>14th month we double $819,200 into $1,638,400

Easier said than done. Can you double your account every month for 14 months consecutively? Maybe yes, maybe no. As you can see above, the first six months are slow. We only make $6,400 in the first six month. After that things become more interesting and the account starts to grow pretty fast. But you will need a lot of discipline during these 14 months to achieve your goal of turning $100 into $1.5 million. Let’s discuss first how we are going to double the account per month. In order to double your account each and every month, you need to make a return of 100% per month each and every month. Can you make 100% return per month? It depends on your trading strategy. So let’s discuss our trading strategy in detail now.

The Million Dollar Trading Challenge Trading Strategy

What we need is just make 50 pips daily. That’s all. Let me show you how this is going to help us achieve our target of 100% return in 1 month. If we make 50 pips daily with a stop loss of 25 pips, our trade will have a reward to risk ratio of 2:1. So if we lose the second trade should be able to recover the loss still make a profit of 25 pips. If we lose 2 trades in a row, we just need one winning trade to recover the loss of 50 pips. So we will aim to make at least 50 pips daily with a stop loss of 25 pips. Somedays we also make 100 pips and maybe 200 pips. But we should make 50 pips daily at least. Risk management is the most important component of any trading strategy. You should read this post that explains the Million Dollar Trading Challenge Risk Management Rules first before you proceed below. In the above post you learn how we are going to keep the risk 2% per trade.

50 pips daily means 1000 pips in 1 month (there are 20 trading days in a month). Let’s start with $100. We start with 0.01 lot. This is the minimum lot size available. Using 0.01 lot means our risk is 2% if our stop loss is 20 pips. So will will use a stop loss of 20 pips per trade and keep the risk per trade at 2% level. We make 50 pips daily with 0.01 lot. This translates into $5 profit. In 20 days, we have a profit of $100. So we have doubled our account.

Next month we increase the lot size to 0.02. We make 50 pips daily with 0.02 lot now. This translates into $10 and in one month we have a profit of $200. So we have double $200 into $400. In the third month we increase the lot size to 0.04. You can do the maths and check that with 50 pips daily using 0.04 lot we will be making $400 profit. In the fourth month we increase the lot size to 0.08 and make 50 pips daily with this lot size. This gives us a profit of $800. So our account once again is doubled to $1600. The following table shows the lot sizes that we will be using in each month during the 14 month period:

–> 1st month: 0.01 lot

–>2nd month: 0.02 lot

–>3rd month: 0.04 lot

–>4th month:0.08 lot

–>5th month:0.16 lot

–>6th month: 0.32 lot

–>7th month: 0.64 lot

–>8th month:1.28 lot

–>9th month:2.56 lot

–>10th month:5.12 lot

–>11th month:10.24 lot

–>12th month:20.48 lot

–>13th month:40.96 lot

–>14th month:81.92 lot

Now the second part of the Million Dollar Trading Challenge Trading Strategy is to combine binary options with forex. We will be trading 30 minute binary options using the same system that we use to trade forex. Read this post that explains the Million Dollar Trading Challenge Binary Options Trading Plan. So we are simultaneously trading both forex and binary options in the Million Dollar Trading Challenge. Now we discuss our trading system in detail below.

The Million Dollar Trading Challenge Trading System

The Million Dollar Trading Challenge Trading System is simple. It uses 21EMA and 55EMA to determine the trend and then candlestick patterns and MACD to find the entry and exit. We will be using this trading system on M15 timeframe to make 50 pips daily. On M30 and H1 timeframe, this system can make 100 pips easily. So as said above we will be making 50 pips daily on average and somedays we make 100 pips and even 200 pips. So it all depends on how much the market moves. Somedays we lose as well. Always keep this in mind losing is an inherent part of trading. We should not be afraid of losing. Risk management Rules are precisely meant for this to mitigate our loss and help recover the loss. We will keep the risk 2% all the time.

The entry rules for the trading system are simple. We look for a bullish or a bearish candlestick pattern like the engulfing pattern, harami pattern or a hammer or a hanging man. Then we use MACD to confirm that this is not a false pattern. Once we have the confirmation, we enter into our trade. We place the stop loss which should be 20-25 pips and take profit of 50 pips. We choose the lot size according to the account equity. After this the trade is set and forget. Either the stop loss gets hit or the take profit target gets hit. If we have $800 in our account our lot size should be 0.16 lot. If we have $50,000 as account equity, the lot size should be 2.56 lot. Read the post on the Million Dollar Trading Challenge Risk Management Rules that explains in great detail how you are going to choose the lot size. It gives you the formula that you will use to determine the lot size. If everything is working according to the plan and if we start with $100, then the lot sizes that we are going to use each month are also given above. You can join the Million Dollar Trading Challenge and try it for 14 days for $1 only.

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