Steps to Strategic Success
A codex is very personal and will differ with each trader. The FxCodex method is my personal way of trading. GSIFTS will use it to explore the codex philosophy but offer individual choices for traders who want to go in a different direction. The key is developing a trading codex leading to a process rather than an elements trading approach.
Principles of Codex and FxCodex
- Codex is a process.
- Each step in a process is based on previous steps.
- Steps talk to each other. A change in one step of the process requires other steps to be adjusted.
- Process changes should be evolutionary rather than revolutionary.
- FxCodex is the name given my specific codex.
Developing any personal trading codex requires the trader to make a
number of initial decisions. These decisions will define your initial trading codex. You can begin with a simple, basic structure and add to it as your experiences in the market dictate. This is just one of the advantages of the codex approach.
These decision steps are the transition required to move from a traditional-elements approach to a codex-process approach to trading. Too many traders begin without having made these decisions and then make sharp revolutionary changes in strategies as they go along. It is far better to have a codex defined before making any trades and make small, evolutionary adjustments thereafter.
The traditional strategies give heavy emphasis to trading tools, often ignoring money management and soft elements such as style, market selection, psychology, and tactics. The codex approach gives equal emphasis to all of them and places them in a process paradigm. See Figure 1.1.
The trader may move back and forth between these steps before having fully built a codex. You may find, for example, that you have selected currency pairs inappropriate for your trading style. If so, you may want to go back and consider the selection of currency pairs vis-a-vis that information. The codex approach allows you to weave back and forth without major disruption to your overall trading method.