Game Plan Extended

Before you put on a trade, what is your game plan?

When you enter the trade, what is your game plan?

Once you enter the trade, do you STICK to your game plan?

Think of the last stock you bought, why did you buy it?


What reasons were presented that compelled you to invest in that stock? 

Was it a hot tip, was it recommended on CNBC, was it a tradeable setup?

What was your game plan once you entered?


We have found that the better the game plan the better the trade will be. Most investors are not properly educated, and subsequently are not the ones who make money year after year. There is no magic ball, the ones who are successful are consistent, they know their game plan, their risk reward, and are unattached and unemotional in the trade. The more work you put into the idea the less chance that you will be caught off guard. At the end of the day it is your money and you want it to be in safe hands (your hands), but you need to learn the rules of the game and learn them well before you can succeed. 

Before your next trade you should be able to answer these questions.

Ticker/Name of the company

Daily Chart of the last year of trading showing the resistance level

What sector it is in/Competitors

What is it’s average beta 

What is the set up - Pattern, Price Level, News, Etc

What is your ideal entry price

What is your stop loss, a $ amount, a % amount, low of day etc

What is your target

Are you going to scale into/out of the position

Will you trail your kicks/stops

When is their next earnings report

How was there latest earnings report (most important did they report raised or lowered future guidance, this is 10x more important than EPS beat or miss)

When is their ex dividend date if applicable

The ATR (Average Trading Range)

The ATV (Average Trading Volume)

The Average Spread of the Stock

Support/Resistance of the stock for your given timeframe

Important Levels on the Daily

Short Interest in the Stock

If you can't answer these questions then you are not prepared for that trade. We can go on and on, the more you have your game plan mapped out and are sticking to it, the more effective you can manage the position you are in.

Once you enter the trade you should:

  1. Already have your game plan before entering
  2. Have a hard out
  3. Adjust your risk reward target so the trade is at least 2-1 for your first kick (sale) strive to make 5:1 on each trade 
  4. Have a plan for trailing
  5. Learn to hold the pull back in profitable trades- stocks need to breathe and weed out the weak hands

Do you have balls?

Post a complete game plan in the Chart Reading Group Chat, answering all 17 questions for your favorite chart setup. 


You are already 5% towards reaching your goal of finishing these lessons, keep it up! If your proud of this say “I’m at the 5% mark!” in the Chart Reading Group Chat!

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