What This Resource Helps With
The Pre-Trade Risk Checklist is designed to make you pause before entering any trade. It forces traders to confirm the setup, define the risk, and ensure the trade meets your criteria:
- • Setup Confirmation: Does this setup match your trading plan? Is the timeframe correct?
- • Market Structure: Is the trade aligned with the current trend and structure?
- • Risk Definition: Where is your stop? What's your exact risk amount?
- • Position Sizing: Is your position size appropriate for your account and risk tolerance?
- • Emotion Check: Are you entering out of FOMO, or because the setup is actually valid?
How to Use It
- 1. Before every trade, pull up this checklist. Don't skip this step.
- 2. Work through each item. Confirm the setup, check the structure, define your stop and risk amount.
- 3. If you can't check off an item, do not take the trade. Waiting for a cleaner setup is always an option.
- 4. Ask yourself the emotion question: "Would I take this trade if it was 4 hours ago? Or am I chasing?"
- 5. If everything checks out, place the trade with confidence. You've done your homework.
Key Takeaways
- ✓ A checklist is your defense against impulsive, emotional trading.
- ✓ Passing on a trade is a valid trade decision.
- ✓ Risk must be defined before you enter, not after.
- ✓ Discipline in preparation leads to discipline in execution.