Article Only Take a Trade if it Passes This 5 Step Test

T2W Bot

Staff member
Dec 19, 2004
1,416
41
#1
No matter which market you trade – stocks, forex or futures – each second the markets are open provides an opportunity to trade. Yet not every second provides a high-probability trade. In a sea of nearly infinite possibilities, put each trade you consider through a five-step test so you’ll only take trades that align with your trading plan and offer good profit potential for the risk being taken. Apply the test whether you’re a day trader, swing trader or investor. At first it will take some practice, but once you become familiar with the process, it takes only a few seconds to see if a trade passes the test, telling you whether you should trade or not.
Step 1: The Trade Setup The setup is the basic conditions that need to be present in order to even consider a trade. For example, if you’re a trend-following trader, then a trend needs to be present. Your trading plan should define what a tradable trend is (for your strategy). This will help you avoid trading when a trend...
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trendie

Legendary member
Jan 8, 2004
6,062
966
#2
good article, as its aimed at beginners.
(wrote more relating to account risk, but managed to delete it instead of edit it!)
 

NVP

Legendary member
Jun 21, 2004
36,091
1,752
#4
ok but not convinced on number 5

pretty solid for beginners .....

but re 5 .....how does anyone know where the price will go ? ........and if so why limit yourself with meaningless R;R targets ?

we are endlessly taught that bad traders cut winners too early ...so lets not encourage such behaviour ?

N

heres my 1 step rule ............follow your strategy rules 100%