That order seems okay, though I don't quite see why choosing and arranging sounds are two steps - if you already have the composition, and are choosing the sounds to play each part, what's left to arrange? I'd rename step 3 to "set appropriate levels".

After step 3 the mix should be sounding really good already. If it isn't, either tweak your levels or find sounds which want to fit together.

I don't know whether I'd separate out compression...if that mindset is working for you, then stick with it. I'm happy to have EQ as a separate step after sound choice and level setting, since filtering and EQ cuts can really clean up and improve a mix. But other tools, such as compressors, delays, reverbs, stereo enhancers, are much more creative effects. I'd lump all of those together.

With experience you'll be able to pick up early in the process when a sound is wrong for a particular song, and scrap it immediately, rather than trying all kinds of EQ and compression and whatever else to somehow try to make it fit.

I start with laying out a kickdrum, and then decide what else this track needs, which usually is a snare and some cymbals, then the bassline.. and i start immediate to arrange the track and continue moving back and forward in the arrangement until i feel it sounds good enough, given that im happy with the composition.
Mixing and adding effects as i go along, the last 10% of a track will then take me as long to complete as the first 90%.

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