Daily Routine Checklist for
Traders
No trading is ever complete without a routine to make
good trading habits in preparation for the trades. Once a routine is being
carried out consistently, trading success will come consistently. A basic
checklist will get a new trader started.
Most traders go day to day trading on the fly, take
a position when it "feels right", especially in the heat of the moment
when prices are just moving without them. Not preparing for what lies ahead
for the day, week or month can be a costly endeavor. Many don't come with
a plan, much less a checklist to prepare for the day. Many professionals
are preparing two to three hours even before the market opens. It only
shows how serious they value their work and money.
No trading is complete without a routine to make good
trading habits in preparation for the trades. No good trading results come
from lack of preparation. Once a routine is carried out consistently, trading
success will come consistently. A basic checklist below will get a new
trader started. Modifications can be made accordingly to fit the trader's
preferences (use of fundamental or technical analysis), trading style (day,
swing, position) and markets (single or multiple markets).
Before market opens
1. Check the day's economic calendar for any scheduled
reports and announcements for the day-- This part covers the fundamental
analysis. He will be checking the expected numbers against reports that
will be publish during the day, recalculating the numbers to find value.
(This is typically for the trader whose major strategy is based on fundamentals).
2. Draw up analysis for changes in the fundamental news
& reports (interest rate changes, jobless numbers, specific company
earnings etc.) to reflect to current market conditions.
3. Check the chart for overnight price action-this is
mainly for a trader who trades using technical analysis. Normally he will
check to see if the prices have violated any support/resistance area or
any numbers that he considers important enough to confirm or reject the
current direction or market conditions. In forex, the most popular indicators
and tools used are:
a. Fibonacci numbers
b. Floor pivots (daily, weekly, monthly)
c. Support/Resistance areas (daily, week, month)
d. High/Low/Open/Close
e. MACD, RSI, Momentum, Volume, or other indicators.
4. Write a trading plan – This step provides the trader
to write out his plan for the day, how many trades, how much to risk or
make, where he'll be taking the position and where he'll exit, and how
large the position size he's going to take.
During market hours
1. During market hours, the trader has a few options
at hand:
a. Set alarms to notify crucial levels to trade to change
positions that need to be made. (This is for swing and daytraders)
b. Watch news channels (optional) such as CNBC or Bloomberg
to make sure there are no sudden economic or political news around the
world that may impact market movements such resignation of a president,
or terrorist attack on oil field, etc. (This is for daytraders).
c. Monitor the charts and indicators continuously, trendlines,
pivots, and redrawing Fibonacci levels. (This is for daytraders).
d. Take positions as dictated in the trading plan. If
the setup had appeared during the trading session that was written in the
trading plan, execute it accordingly.
After market hours
Trader's Daily Routine Checklist Who Have Signal-Service
or Newsletter Subscriptions
1. Check/read newsletters from paid/unpaid subscriptions
from signal service, news, analysis, etc. and compare them to trading plan.
Analyze them accordingly to be sure these fit into the trading plan.
2. Strategy portfolio management and maintenance-recalculating
and verify if the balances are correct and if any instrument has gone outside
the percentage of the portfolio. If for example an instrument that was
made 30% in gains, these gains must be settled: either by reducing the
holdings or hedge with another instrument to ensure the gains made or reduce
exposure of the originally instrument.
3. Write/Revise the trading plan for the next day, which
pairs to buy/sell, how many or how much, and tactically at what price to
buy/sell and exit.
It's not mainly about checking everything and read all
the information out there before the market opens. It's about be satisfied
with the retaining content that works for the trading system. But most
important, creating a routine that becomes the foundation in building success
in investing or trading.
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