The First Steps for the Successful Development of any Trading System

This article outlines some essential preliminary steps for developing a successful trading system, along with key biases to avoid. The content is primarily based on Van Tharp's book Trade Your Way to Financial Freedom.

Step 1: Finding a Concept That Works

Finding a concept that works should be considered the first step in building any trading system. An effective concept should include detailed setups for entries and exits, along with clear money management rules. This means defining entry conditions, exit strategies, and position sizing. However, most traders focus primarily on high-probability entries without considering proper position sizing or exit planning. This approach often results in a negative expectancy.

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EA Builder Review

EA Builder is a web application that allows Forex Traders to create their custom indicators and trading strategies without any programming skills. You can either create a manual trading system (for free) or build a fully functional Expert Advisor (Forex robot) for a one-time fee.

◙ Trading System: EA Builder

◙ Type: Create custom manual & automated trading system

◙ Platform: MetaTrader4, MetaTrader5, and Tradestation

◙ Price: 97 USD (One-Time Fee)

EA Builder Key Features

Here are the main features of EA Builder:

• Free to create indicators; one-time payment required to create Forex Robots (EAs)

• Supports MetaTrader 4, MetaTrader 5, and TradeStation

• Compatible with any financial instrument (Forex, stocks, metals, energies, indices, ETFs)

• Supports binary options trading via MT4

• Free subscription includes unlimited indicators

• Development of Forex Robots (EAs) available for a one-time fee of $97

• Video tutorials available to guide users on how to use EA Builder

• Ability to create custom alerts (email, audible, and on-screen)

• Supports advanced functions such as trendlines, support and resistance levels, and time functions

• Includes sophisticated money management features

» EA Builder Web

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What is a Trading System?

A trading system is a structured methodology that defines when, how, and why to enter and exit trades in financial markets. It relies on a set of rules based on technical indicators,

price action, fundamental data, or quantitative models to make objective trading decisions. The main goal is to eliminate emotional bias, improve consistency, and increase the likelihood of profitable trades over time.

Why Use a Trading System?

✅ Eliminates emotional trading—follows rules, not gut feelings

✅ Backtestable—can be tested on historical data before live trading

✅ Improves consistency—reduces random decision-making

✅ Scalable—works across different markets and timeframes

Key Components of a Proper Trading System

1. Trend identification and confirmation across at least two timeframes

2. Complete order setup, including entry price, take profit, and stop loss

3. Money management subsystem with additional rules

4. Positive and proven past performance

Types of Trading Systems

1. Technical Analysis-Based Systems

   Use charts, indicators (MACD, Bollinger Bands), and patterns (head & shoulders, flags). -Example: Buy when price breaks above the 50-day moving average with high volume.

2. Fundamental Analysis-Based Systems

   Trade based on economic data, earnings reports, or interest rate decisions. -Example: Buy a currency when central banks signal rate hikes.

3. Algorithmic/Automated Systems

   Use pre-programmed algorithms to execute trades without human intervention. -Example: High-frequency trading bots exploiting micro-price movements.

4. Arbitrage & Market-Neutral Systems

   Exploit price discrepancies between markets or related assets. -Example: Buying a stock on one exchange while selling its futures contract on another.

5. Discretionary vs. Mechanical Systems

• Discretionary: Allows trader judgment (e.g., Warren Buffett’s value investing).

• Mechanical: Strictly follows predefined rules (e.g., trend-following systems).

More: » Compare Expert Advisors | » Compare Trading Platforms | » Compare Fx Brokers 

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The trader on Chart System Review

◙ Trading System: Trader on Chart

◙ Type: Plug-in Software for Advanced 1-Click Trading

◙ Platform: MetaTrader4

◙ Price: 59 Euro (One-Time Fee)

The Trader On Chart System — Basic Review Information

The Trader On Chart is a system that integrates with MT4 and offers advanced features for one-click trading. While MetaTrader 4 is a powerful platform, many users are familiar with its limitations in money management control. Executing trades with incorrect lot sizes is a common mistake for MT4 users. This simple software makes trading via MetaTrader 4 easier, more reliable, and much faster. As a result, the system is designed to meet the needs of short-term traders, especially scalpers.

Compatibility of the System

The system works with any trading account (4 or 5 digits) and any broker type (ECN, STP, or Market Maker). It can trade any financial instrument available through MT4, including Forex currencies, bonds, stocks, and more.

» Trader-on-Chart System

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