Create a Trading Game Plan

The Cost of Trading Without a Plan Traders who enter the market without a written game plan for the day are making decisions reactively. Reactive decisions are emotional decisions. Emotional decisions produce inconsistent results. The plan doesn't need to be complex — but it must exist before the market opens. Pre-Market Routine (6:00 – 9:30 AM EST) Begin with the economic calendar. Identify any scheduled events — CPI releases, Fed speeches, earnings — that could generate outsized volatility. Mark them. These events change risk parameters for the entire day. Next, scan the futures market: where is NQ or ES relative to yesterday's close? Are we gapping up or down? Identify the key levels: previous day's high and low, overnight high and low, and any obvious daily chart support or resistance. These become your anchors for the session. Setting Daily Targets and Loss Limits Define your daily profit target and your maximum daily loss before the market opens. Write them down. The daily loss limit is the more important of the two — it is the circuit breaker that prevents a bad morning from becoming a catastrophic day. A reasonable daily loss limit is 1-2% of your account. When you hit it, you close the platform and walk away. No exceptions. Identifying Your 2-3 Setups for the Day You don't need to trade every move. Decide in advance which two or three specific setups you will take today and only those setups. Listing them by name — 'breakout of overnight high with volume confirmation' or 'reversal at prior daily resistance' — creates a cognitive anchor that reduces the temptation to chase random price action. Post-Market Review Spend fifteen minutes after the close comparing what you planned to do versus what you actually did. Any divergence is data. Over time, the pattern of divergences will tell you exactly where your discipline breaks down — and that is where your improvement lives.