Why plan before the open
Once the market moves, it is hard to think clearly. Prices move fast, opportunities seem to vanish and emotions take over. A plan written beforehand moves the important decisions to a moment when you can still think straight.
It also gives you something to review: afterwards you can compare what you planned with what you actually did.
What goes into a trade plan
For every setup you want to trade today:
- Ticker or instrument
- Bias: long, short or neutral, and why
- Key levels: support, resistance, previous highs and lows
- Entry trigger: the exact signal that makes you enter
- Stop: the point where your idea is wrong
- Targets: where you take profit, in steps if you scale out
- Size: how much you risk, ideally a fixed amount in R
- Skip conditions: what makes you leave this trade alone
Check the calendar first
News, earnings and central bank decisions can change the character of a session in seconds. Check what is scheduled before you plan, and decide in advance whether you trade through an event, wait for it or skip the day.
Your own agenda counts too. A short day or a tired morning is a good reason to plan fewer trades.
Keep it short
A plan you never finish writing is no plan. Two or three setups per day, each in a few lines, is enough. The goal is clarity, not a report.
Compare plan and execution
After the trade, ask one question: did I trade my plan? A loss that followed the plan is part of the game. A profit that broke the plan is a habit you don't want to reward.
Over the weeks, the gap between plan and execution tells you more than your win rate does.