2 posts tagged with "trading plan"

"Failing to plan is planning to fail." — Benjamin Franklin

This applies to trading more than anything else.

Without a plan:

• You react instead of act
• Emotions drive decisions
• You chase, you panic, you lose

With a plan:

• You know what to trade
• You know when to trade
• You know when NOT to trade

Let's build your trading plan.

What Is a Trading Plan?​

A trading plan is your pre-market roadmap answering:

✅ What am I looking for today?
✅ What setups will I trade?
✅ What's my maximum risk?
✅ When will I stop?
✅ How will I manage emotions?

Created: Before 9:15 AM
Followed: During market hours
Reviewed: After 3:30 PM

Why Most Traders Don't Plan​

Excuses:

"I'm experienced, I don't need it"
→ Experienced pilots still use checklists

"Planning takes too long"
→ 10 minutes of planning saves hours of losses

"I'll figure it out in real-time"
→ In real-time, emotions take over

"My strategy is in my head"
→ Your stressed brain can't access it

Reality:

The best traders plan obsessively.

They don't wing it. Ever.

The Cost of No Plan​

Let me show you:

Trader A: No Plan​

9:15 AM: Market opens, scrambles to find trades
9:30 AM: Sees RELIANCE moving, buys (no analysis)
10:00 AM: Position red, "should I exit?"
10:30 AM: Exits for loss, "what now?"
11:00 AM: Sees another move, FOMOs in
12:00 PM: Another loss
2:00 PM: Trying to "win it back"
3:30 PM: Account down 3%, emotionally drained

Trader B: With Plan​

Before 9:15 AM: Plan created

• Watchlist: 5 stocks with levels
• Setup: Breakouts with volume confirmation
• Max trades: 3
• Max risk: 2% per trade, 4% total

9:15 AM: Market opens, monitors watchlist
9:45 AM: Setup 1 triggers, enters (as planned)
10:30 AM: Exit at target (planned)
11:00 AM: Watching, no setups (patient)
2:00 PM: Setup 2 triggers, enters
3:00 PM: Closes position at target
3:30 PM: Done for day, +2.5%, calm

Difference: Planning vs winging it

The Complete Trading Plan Template​

Section 1: Pre-Market Analysis (8:30 AM)​

Global Markets Check​

US Close: [Up/Down, %]
Asian Markets: [Sentiment]
SGX NIFTY: [Level, trend]
Key News: [Any major events]

Indian Market Context​

NIFTY Bias: [Bullish/Bearish/Neutral]
Key Support: [Level]
Key Resistance: [Level]
Trend: [Up/Down/Sideways]
VIX: [Level] → [Volatility assessment]

Today's Events​

Economic Data: [RBI, GDP, etc.]
Results: [Major companies]
Sector Focus: [Any sector-specific news]

Section 2: Today's Game Plan (8:45 AM)​

Market Bias​

Today I expect the market to:
[ ] Trend up (trade breakouts long)
[ ] Trend down (trade breakdowns short)
[ ] Range (mean reversion)
[ ] High volatility (reduce size/avoid)

Primary Strategy​

Strategy: [Name from your Strategy Book]
Setup: [Specific pattern]
Timeframe: [5-min, 15-min, daily]
Entry criteria: [All conditions listed]

Watchlist​

1. RELIANCE - Above 2550 = buy
   Entry: 2555
   Stop: 2530
   Target: 2600
   R:R: 1:2.8

2. INFY - Breakout 1450
   Entry: 1455
   Stop: 1440
   Target: 1480
   R:R: 1:1.7

[Continue for 3-5 setups]

Section 3: Risk Management (9:00 AM)​

Position Sizing​

Account Size: ₹[Amount]
Risk Per Trade: [%] = ₹[Amount]
Max Trades Today: [Number]
Max Daily Loss: ₹[Amount]
Current Portfolio Heat: [%]

Rules for Today​

I WILL:
✓ Trade only watchlist setups
✓ Follow position sizing rules
✓ Set stops immediately
✓ Honor stop losses
✓ Take profits at targets

I WILL NOT:
✗ Chase moves
✗ Trade outside watchlist
✗ Increase size after loss
✗ Move stops against me
✗ Revenge trade

Section 4: Psychological Prep (9:10 AM)​

Emotional Check-In​

How I feel today (1-10): [Number]

If < 6: Consider not trading
If 6-8: Trade with caution
If 8-10: Normal trading

Current mental state:
[ ] Calm and focused
[ ] Slightly anxious (normal)
[ ] Stressed (take day off)
[ ] Overconfident (be careful)

Today's Affirmation​

"I trade my plan, not my emotions.
I control risk, not outcomes.
I follow my rules regardless of results.
I protect capital above all else."

Section 5: Execution Plan (9:15 AM+)​

Session 1: Morning (9:15-11:30 AM)​

Primary focus: [Strategy/setup]
Max trades: [Number]
Watch for: [Specific patterns]

Session 2: Midday (11:30 AM-1:30 PM)​

Typical action: [Observe/selective/avoid]
If trading: [Reduced size/specific setups only]

Session 3: Afternoon (1:30-3:30 PM)​

Plan: [Manage positions/close by 3 PM/watch only]

Sample Real Trading Plan​

DATE: October 10, 2025

=== PRE-MARKET ANALYSIS ===
US Markets: Dow +0.8%, Tech strong
SGX NIFTY: +60 points, indicating gap up
News: No major events
VIX: 14 (low, normal volatility)

NIFTY Outlook: Bullish continuation
Key Level: 24,500 support, 24,800 resistance
Trend: Uptrend intact (above 20/50 EMA)

=== TODAY'S GAME PLAN ===
Strategy: Morning Breakout
Market Bias: Expecting uptrend continuation
Primary Setup: Pullback entries in strong stocks

WATCHLIST:
1. RELIANCE @ 2565
   - Above 2570 = Long
   - Stop: 2550 (-20)
   - Target: 2600 (+35)
   - Position: 100 shares (₹2,000 risk)

2. HDFCBANK @ 1640
   - Above 1645 = Long
   - Stop: 1630 (-15)
   - Target: 1670 (+30)
   - Position: 133 shares (₹2,000 risk)

3. INFY @ 1445
   - Above 1450 = Long
   - Stop: 1440 (-10)
   - Target: 1470 (+25)
   - Position: 200 shares (₹2,000 risk)

=== RISK MANAGEMENT ===
Account: ₹5,00,000
Risk Per Trade: 2% = ₹10,000
Max Trades: 3
Max Daily Loss: ₹15,000
Portfolio Heat: Currently 0%

TODAY'S RULES:
✓ Enter only if ALL criteria met
✓ Set stop immediately after entry
✓ Book 50% at Target 1
✓ Trail stop on remaining
✓ Stop trading after 2 losses
✓ Close all by 3:00 PM

=== PSYCHOLOGY ===
Mood: 8/10 - Calm, focused, ready
Yesterday: +₹6,500 (good discipline)
Focus Today: Patience, quality over quantity

Affirmation: "I wait for MY setups only"

=== SESSION PLAN ===
9:15-9:30 AM: Observe only, confirm bias
9:30-11:30 AM: Primary trading window
11:30 AM-1:30 PM: Selective only
1:30-3:00 PM: Manage positions
3:00 PM: Close all intraday

=== COMMITMENT ===
Signed: [My Name]
Date: October 10, 2025
"I commit to following this plan regardless of outcomes"

How to Use Your Plan​

Before Market Open​

1. Create the plan (10-15 min)
2. Review twice (read it aloud)
3. Visualize executing it perfectly
4. Commit (sign it)

During Market Hours​

1. Keep plan visible (printed or 2nd monitor)
2. Check before every trade (on watchlist?)
3. Update as needed (mark triggered/closed)
4. Refer when emotional (re-read rules)

After Market Close​

1. Review execution (followed plan?)
2. Grade discipline (A-F)
3. Note lessons (what to improve)
4. Plan tomorrow (repeat)

Common Planning Mistakes​

❌ Mistake #1: Too Vague​

Bad Plan: "Trade NIFTY stocks. Look for breakouts."

Good Plan: "Trade only: RELIANCE above 2570, INFY above 1450, HDFC above 1645. Enter with volume confirmation. Stop below breakout point. Target 1:2 R:R."

❌ Mistake #2: Too Complex​

Bad Plan:

• 20 stocks on watchlist
• 5 different strategies
• Complex calculations mid-trade

Good Plan:

• 3-5 stocks maximum
• 1-2 strategies
• Pre-calculated levels

❌ Mistake #3: No Flexibility​

Bad Plan (too rigid): "Must take all 3 trades"

Good Plan: "Up to 3 trades IF setups trigger"

❌ Mistake #4: No Risk Limits​

Bad Plan: Lists trades but no max loss

Good Plan: "Stop after ₹15K loss or 2 losses, whichever first"

❌ Mistake #5: Not Writing It Down​

Bad Plan: "I'll remember it"

Good Plan: Written, printed, visible

Benefits of Trading Plans​

Benefit #1: Removes Emotion​

Without plan: "What should I do?"
With plan: "What does my plan say?"

Decision made before emotion enters.

Benefit #2: Builds Discipline​

Tracking: Did I follow the plan?

Over time: Following plan becomes automatic

Benefit #3: Identifies Edge​

Data: Planned trades vs random trades

Discovery: Planned trades win 64%, random win 38%

Action: Stick to planned trades only

Benefit #4: Reduces Stress​

Knowing:

• What you're looking for
• When to trade
• When to stop

Result: Calm, focused, confident

Benefit #5: Improves Over Time​

Monthly review:

• What plans worked?
• What didn't?
• Patterns in winning plans?

Continuous improvement based on data

Advanced Planning​

Weekly Planning (Sunday Evening)​

WEEK: Oct 7-11, 2025

Major Events This Week:
- Wednesday: RBI policy
- Friday: US jobs data

Weekly Strategy:
- Monday-Tuesday: Normal trading
- Wednesday: Observe only (RBI)
- Thursday-Friday: Resume trading

Focus This Week: Discipline
Last Week Performance: +₹18K
Goal This Week: +₹20K
Improvement Area: Exit too early

Monthly Planning​

MONTH: October 2025

Goals:
- Win Rate: >60%
- Risk:Reward: >1:2
- Max Drawdown: <8%
- Trading Days: 18-20

Strategy Review:
- Strategy A (Breakouts): 68% WR → Keep
- Strategy B (Pullbacks): 45% WR → Refine or drop

New Rules to Test:
- No trading after 2 PM
- Volume must be 1.5x average

Areas to Improve:
- Hold winners longer
- Cut losers faster

TradeLyser Planning Features​

TradeLyser makes planning easy:

"Start My Day" Workflow​

• Guided planning process
• Templates for different strategies
• Auto-fills market data
• Saves your plans

Plan Tracking​

• Compare: Plan vs Actual
• Metric: Adherence score
• Insight: When you deviate, results?

AI-Powered Suggestions​

• Elysia reviews past plans
• Identifies what worked
• Suggests improvements
• Customizes to your trading

The Bottom Line​

You wouldn't:

• Build a house without blueprints
• Fly a plane without a flight plan
• Perform surgery without a procedure

Why would you trade without a plan?

Planning is:

• Not optional for serious traders
• The difference between pro and amateur
• Your edge in chaotic markets

10 minutes of planning:

• Saves hours of stress
• Prevents costly mistakes
• Improves results dramatically

Plan your trade. Trade your plan.

Take Action Now​

Today:

1. Download the trading plan template
2. Create your plan for tomorrow
3. Set 15 minutes aside each morning

This Week:

1. Plan every single day
2. Track adherence (%)
3. Compare: planned vs unplanned trades

This Month:

1. Review all plans
2. Identify patterns in winners
3. Refine your planning process

👉 Use TradeLyser's "Start My Day" Feature
👉 Download: Daily Trading Plan Template
👉 Next: How to Handle a Losing Streak

Do you create daily trading plans? What's your process? Share below.

After five years of inconsistent results, mounting losses, and near-burnout, I discovered something that changed everything: Rules aren't restrictions. They're freedom.

Here are the seven rules that transformed my trading from chaotic gambling to systematic profitability.

Rule #1: Never Risk More Than 1% Per Trade​

The Problem I Had:

Early in my career, I'd risk 5-10% on "high conviction" trades. One bad week could wipe out a month of gains.

The Math That Changed Everything:

With 10% risk:

• 5 losing trades = -50% account
• Need +100% to recover

With 1% risk:

• 10 losing trades = -10% account
• Need +11% to recover

Real Impact:

Before: Blown account twice in 2 years
After: Survived 15-trade losing streak with capital intact

How to Implement:

Position Size = (Account Size × Risk %) / Stop Loss Distance

Example:
Account: ₹5,00,000
Risk: 1% = ₹5,000
Stop: 50 points away
Position Size = ₹5,000 / 50 = 100 shares

TradeLyser Feature: Set automated alerts when position size exceeds 1% risk.

Rule #2: No Trading After Two Consecutive Losses​

The Pattern I Discovered:

My journal revealed: After 2 losses, my win rate dropped from 58% to 31%. Why?

• Revenge trading
• Forcing setups
• Abandoning strategy
• Emotional decisions

The Rule:

After 2 losses in a day:

1. Stop trading
2. Close platform
3. Journal both trades
4. Identify what went wrong
5. Return tomorrow (only if ready)

Real Results:

Before this rule (6 months):

• Average day after 2 losses: -₹8,500
• Emotional state: Tilted
• Biggest loss day: -₹32,000

After this rule (6 months):

• Stopped 47 potential "day 3" trades
• Estimated losses avoided: ₹2,18,000
• Mental health: Dramatically better

How to Enforce:

Set a daily loss limit in TradeLyser that automatically alerts you. Better yet, use broker position limits.

Rule #3: Trade Only Your A+ Setups​

The Painful Realization:

I tracked 300 trades and discovered:

• A+ setups (my best pattern): 68% win rate
• A/B setups: 52% win rate
• C setups (boredom trades): 29% win rate

The Rule:

Only trade when:

• My primary pattern appears
• Market context is favorable
• Risk:reward is minimum 1:2
• I can articulate the thesis in one sentence

Example:

A+ Setup (I take this): "Bullish flag breakout on NIFTY with rising volume, broader market trending up, clean support nearby."

C Setup (I skip this): "Stock is moving... looks interesting... maybe it'll go up?"

Impact:

Before: 23 trades/month, 48% win rate
After: 12 trades/month, 64% win rate
Result: Same profit with half the stress

Remember: Boredom is not a trading setup.

Rule #4: Set Stops Before Entry (No Exceptions)​

The Expensive Lesson:

My biggest loss ever: ₹67,000 on a single trade.

Why? No predefined stop loss. I kept moving it: "Just 10 points more..."

The Rule:

Before every trade:

1. Determine stop loss (technical level, not arbitrary)
2. Calculate position size based on stop
3. Enter stop order immediately after entry
4. Never, ever move it against you

The Only Exception:

Moving stop loss in your favor (trailing stop) is allowed and encouraged.

Real Example:

Trade: Long RELIANCE @ 2500
Stop: 2470 (previous swing low)
Target: 2600
Risk:Reward: 1:3.3

Even if it feels wrong, even if "it's about to turn," the stop is sacred.

Result:

• Small losses stay small
• No more catastrophic losses
• Sleep peacefully during overnight positions

Rule #5: No Trading in the First 15 Minutes​

What I Learned:

The first 15 minutes after market open (9:15-9:30 AM) are chaos:

• Overnight news gets priced in
• Stop hunts are common
• Spreads are wider
• Emotional trading is highest

My Data:

First 15-min trades:

• Win rate: 39%
• Average loss: 50% larger than usual
• Emotions: High

After 9:30 AM:

• Win rate: 58%
• Better setups
• Clearer price action

The Rule:

9:15-9:30 AM: Watch only

• Check overnight news
• Identify key levels
• Watch for direction
• Let the dust settle

9:30 AM onwards: Trade my setups

Exception: Pre-planned gap strategies (tested and documented).

Rule #6: Close All Positions by 3:00 PM (Intraday)​

Why This Matters:

For intraday traders, the last 30 minutes (3:00-3:30 PM) are dangerous:

• Liquidity thins
• Volatility spikes
• Unpredictable moves
• Can't react properly

My Experience:

Trades held past 3 PM:

• 34% reversed against me
• Wiped out good days
• Added unnecessary stress

The Rule:

By 3:00 PM:

• All intraday positions closed
• Booked profits or losses
• Day is done

For swing trades:

• Separate account/tracking
• Different risk parameters
• Planned overnight holds only

Result: No more "let me just hold 5 more minutes" disasters.

Rule #7: Journal Before Sleeping (Every Trading Day)​

The Most Important Rule:

None of the above rules matter if you don't have a system to:

• Track adherence
• Identify patterns
• Continuously improve

The Evening Ritual:

Every trading day, before sleep:

1. Journal all trades (5 minutes)
2. Grade my discipline (A-F)
3. Note one thing done well
4. Note one thing to improve
5. Prepare for tomorrow

What to Track:

• Did I follow my rules?
• Which rule did I break (if any)?
• Why did I break it?
• What was the emotional state?
• What's tomorrow's focus?

The Compound Effect:

Day 1: Just recording
Week 1: Noticing patterns
Month 1: Behavior changing
Month 3: Rules become automatic
Month 6: Different trader

Make It Easy:

Use TradeLyser's auto-journaling:

• Trades sync automatically
• Rule adherence is tracked
• Patterns are highlighted
• Reviews take 2 minutes

How I Enforce These Rules​

Level 1: Written Document​

• Rules printed and displayed
• Read before every session

Level 2: Checklists​

• Pre-trade checklist
• Post-trade review
• Daily review

Level 3: Automation​

• TradeLyser automated rules
• Broker position limits
• Alert systems

Level 4: Accountability​

• Share with trading buddy
• Weekly review sessions
• Monthly progress reports

My Results: Before and After Rules​

Before Rules (Year 1-2):​

• Trades: 800+
• Win Rate: 46%
• Annual P&L: -₹1.2L, +₹45K
• Emotional state: Roller coaster
• Sleep quality: Poor

After Rules (Year 3):​

• Trades: 320 (fewer, better)
• Win Rate: 61%
• Annual P&L: +₹4.8L
• Emotional state: Stable
• Sleep quality: Excellent

The difference? Not skill. Not capital. Discipline.

Create Your Own Sacred Rules​

These are MY rules based on MY data. Yours might be different.

How to Find Your Rules:

1. Journal 50 trades (minimum)
2. Analyze the data:
   • When do you perform best/worst?
   • What mistakes repeat?
   • What patterns emerge?
3. Create rules to:
   • Capitalize on strengths
   • Protect from weaknesses
4. Test for 30 days
5. Refine and enforce

The Most Common Objections​

"Rules kill creativity!"

No. Rules provide structure so creativity can flourish. Jazz musicians master fundamentals before improvising.

"But what if a great setup appears?"

If it violates your rules, it's not a great setup FOR YOU. Your edge is your strategy + discipline, not random opportunities.

"I can't follow rules consistently."

Then you can't trade consistently. It's that simple. Automate what you can, build habits for the rest.

Implementation Plan​

Week 1: Choose Your Rules​

• Review your trading journal
• Identify your 3-5 most important rules
• Write them down

Week 2: Create Systems​

• Set up TradeLyser automated rules
• Create checklists
• Set broker limits

Week 3: Practice​

• Paper trade with strict adherence
• Test your systems
• Refine processes

Week 4+: Live Trading​

• Trade with real money
• Track adherence
• Adjust as needed

The Hard Truth​

You already know what you should do.

Stop when you're down.
Use stops.
Trade your plan.
Manage risk.

Everyone knows. Few do it.

The difference between knowing and doing is discipline.

And discipline is built through:

• Clear rules
• Tracking adherence
• Automated enforcement
• Consistent review

Your Turn​

What rules do you need?

Look at your last 20 trades. What would have improved them?

Write down 3 rules today. Start with those.

Don't try to be perfect. Try to be better than yesterday.

Take Action Now​

👉 Set Up Automated Rules in TradeLyser
👉 Download: Trading Rules Template
👉 Next: How to Start Your Trading Day Right

What's your #1 trading rule? Share in the comments.