What question do you ask yourself before you enter a trade?

Everyone has their own trading preferences, systems and psychology, however, one thing we can probably learn from each other, is the question we ask ourselves before we enter a trade. What is the question you ask yourself before you enter each trade?

For me, it’s a good mix of lessons I have learnt over time and after filtering through all the marketing hype and what not, all boiled down to this question:

“If I enter this trade, am I confident enough to not modify the system I have during live price action?”

A system that has an edge will bring about a winning ratio that is above 50% over time, which means losses are inevitable. If I am confident enough with my system, I will not modify the trade details because I know over time I have done enough back-testing to know that I will be profitable at the end of the trading period.

But if I entered a trade that I’m not confident enough, caving in to the “what if” thought that lingers in the mind and start tweaking the trade orders as and when I feel like it, this is no longer a trading system, but a gambling mindset that has no proper statistical data to comprehend actual profitability.

That’s coming from my own experience, would love to hear other questions from the community! :raised_hands:

SIA

1 Like

I think that’s an interesting question, SIA! :blush: And would definitely require a certain level of discipline that I’m afraid I still struggle to maintain. :sweat_smile: For me though, although it might be the wrong mindset, I think about surrender. :sweat_smile: I ask myself, “If price doesn’t move the way I initially anticipated it to, would I be okay with losing? Is my SL reasonable enough that I wouldn’t be super down when I get the notification that I’ve been stopped out?” :sweat_smile:

1 Like

This is a very interesting question though! :blush: And I’m also looking forward to what the others have to say. :smiley: I’m sure there will be interesting perspectives! :smiley:

1 Like

Thanks for sharing Ria! Looking forward to what other community members has to share on this topic!

SIA

I ask myself, “Does this trade make sense with my overall strategy?” I want to be sure I’m not just chasing a quick win but rather making a decision based on solid analysis. I also check if the trade aligns with my risk tolerance and if I’m prepared for the potential outcome, good or bad.

1 Like

I always check my mindset first. Am I feeling calm and clear-headed? If I’m not, I step back. Then, I make sure the market conditions align with my plan and consider if I’m emotionally stable enough to handle any potential losses. If I’m uncertain, I hold off until everything aligns.

1 Like

I have an entry strategy so I just ask is this trade meeting all the criteria for my strategy.

2 Likes

Would you really be trading, in the first place, if there were any question about that?! :open_mouth: