Yogi Berra had a way of stating the obvious when he said, "If you don’t know where you are going, you will wind up somewhere else."

However, obvious the importance of having a clear plan may be, many traders begin the trading day without any real plan.

They start the day with the hope that they will have a great day and make lots of money. These unprepared traders typically do neither.

I believe that every trader should have a detailed written plan of attack for the day.

The plan should list:

Trading: the contracts you intend to trade, the hours you will trade, the set-ups you will take,

Risk: your loss limit in ticks per trade and in total dollar loss per day, what you will do after x number of losses in a row, your strategy for increasing and decreasing your trading size,

Goals: how many ticks are you trying to make today, how many trades do you plan to make, how long do you plan to hold winners and losers

Reporting: your plan for writing a brief narrative of the day’s trading your plan to keep statistics of your trades (hold times, results, et cetera), how you will mark your trades on the same charts you use to trade,

Contingencies: what number do you call to get out of trades should your system crash, who can you contact to troubleshoot or repair your computer, who do you call to get your Internet connection checked and fixed, if needed.

With a well developed, clear plan you will be ahead of the majority of traders and, through this detailed planning, you can concentrate on achieving your stated goals.

Let other traders hope for a great day.

You can plan on it.

Back to Yogi Berra: when leaving a nice hotel, he complained that "the towels were so thick there I could hardly close my suitcase."

Wishing you success in your trading,
Jeff

For more of Jeff’s articles on trading, go to www.JeffQuinto.com or check out his website for serious traders at www.TransformativeTrading.com.