Sumary of 7 Step Trading Checklist Before Entering Any Trade:
- Maintaining a trading checklist presents traders with a list of questions that traders need to answer before executing trades.
- Your Trading ChecklistBefore entering a trade, ask yourself the following questions:Is the market trending or ranging?
- Trending marketsExperienced traders know that finding a strong trend and trading in the trend’s direction, has the potential to lead to higher probability trades.
- There is a well-known saying that trending markets have the ability to bail traders out of bad entries.
- Traders need to ask themselves if the market is exhibiting signs of a strong trend and whether ‘trend trading’ forms part of the trading plan.
- Ranging marketsRanging markets tend to see price bounce between support and resistance to trade within a channel.
- Certain markets, like the Asian trading session, tend to trade in ranges.
- The same applies when price approaches a key level of resistance and typically drops lower shortly after.