You have done the analysis. The setup looks clean. Everything seems right.
Before you press the button — run the checklist.
A pre-trade checklist is a short list of objective questions you answer before entering every single trade. If any answer is no — you do not enter.
It takes 60 seconds. It has saved more trading accounts than any indicator or strategy ever invented.
Commercial pilots use checklists before every flight. Not because they have forgotten how to fly. Because even experienced professionals make mistakes under pressure — and a checklist catches those mistakes before they become disasters.
Trading is no different.
In the heat of the moment — when a setup is forming fast and the entry window is closing — it is easy to skip a condition. To tell yourself the setup is close enough. To let excitement override discipline.
The checklist does not care about excitement. It asks its questions and waits for honest answers.
These are the questions every trade must answer before entry:
Question 1 — Is the higher timeframe trend in my favour?
If I am taking a long trade — is the daily chart bullish?
Trading against the dominant trend dramatically reduces probability of success.
Answer must be yes or the trade does not happen.
Question 2 — Is price at a meaningful level?
Is this entry at a key support or resistance level — or am I entering in the middle of nowhere?
Entries at meaningful levels have defined risk and clear logic.
Random mid-range entries do not.
Question 3 — Has my entry trigger fired?
Has the specific confirmation signal appeared — the candlestick pattern, the indicator crossover, the volume spike?
Or am I anticipating it and entering early?
The trigger must have fired. Not almost fired. Fired.
Question 4 — Is my stop loss level clear and logical?
Do I know exactly where my stop goes?
Is it at a level that proves the trade thesis wrong — not just a comfortable distance from entry?
If I cannot answer this immediately — I am not ready to enter.
Question 5 — Is my target realistic and at least 2R away?
Is there clear space between entry and target with no major resistance in the way?
Is the potential reward at least twice the risk?
A trade with less than 2R potential is rarely worth taking.
Question 6 — Have I calculated my position size correctly?
Using the position size formula — what is the correct number of units to risk exactly 1% of my account?
Never estimate position size. Calculate it every time.
Question 7 — Am I in the right emotional state to trade?
Am I calm, focused and following my plan?
Or am I frustrated from a previous loss, overexcited from a winning streak, or distracted by something outside trading?
Emotional state affects execution quality more than most traders realise.
Question 8 — Have I hit my daily loss limit today?
If yes — the session is over. No more trades regardless of how good the setup looks.
The daily loss limit exists for this exact moment.
Print it. Write it on a sticky note next to your screen. Save it as a phone note.
Before every trade — read each question and answer it honestly out loud or in writing.
Not in your head. In your head the answers are too easy to manipulate.
Written or spoken answers create accountability. They force honesty in the moment when honesty is hardest.
After 100 trades with a completed checklist — review which questions were most often answered no.
If question 1 is frequently no — you are regularly trying to trade against the trend.
If question 7 is frequently borderline — emotional state is a consistent weakness.
If question 6 is ever skipped — position sizing discipline needs immediate attention.
The checklist is not just a filter. It is a diagnostic tool that reveals exactly where your discipline breaks down — so you can fix it systematically.
In the next topic we will study accepting losses — the psychological shift that separates traders who last from traders who quit.