The pre-trade checklist: 8 questions before every trade
Pilots run a checklist before every flight, even after thousands of them. Not because they forget, but because it catches the one thing a busy day hides.
Why a checklist works
Most trading mistakes aren't about knowledge. They happen in the moment: a rushed entry, a forgotten stop, a trade taken right before big news.
A checklist turns your plan into a few yes-or-no questions. It takes under a minute, and it catches the most common slips before they cost anything.
The checklist
Ask these eight questions, in this order, before every trade:
- Does the bigger chart agree? I checked a higher time frame first, and this trade goes with its direction.
- Is price at a real zone? It's at a level where price clearly turned before, not in the middle of nowhere.
- Did a candle body close past the level? A body close counts. A wick poking through doesn't.
- Is my stop set from the chart? It's just past the last turning point my idea depends on, and I set it before entering.
- Is my size from the math? Money at risk (about 1%) ÷ stop distance. Not a guess, not a feeling.
- Is my target at least 2-to-1? The next real level is at least twice as far as my stop.
- Is the news clear? No big scheduled event, like CPI, an FOMC decision or earnings, in the next while.
- How do I feel — calm? Not rushed, not angry about the last trade, not bored, not tired.
Eight yeses: the trade fits your plan. Any no: stop and think hard before going ahead.
Tape it to your screen. A checklist you have to go looking for is a checklist you'll skip.
Each question, explained
1. The bigger chart
Trades that go with the bigger trend have the wind at their back. Check the daily or 4-hour chart first, then zoom in. More in multiple timeframe analysis.
2. A real zone
Good decisions happen at the edges, where price turned before. In the middle of a range, price can go either way. See support and resistance.
3. A body close
A candle's thin lines (wicks) often poke past a level and snap back. Waiting for a body to close past it filters out many of those traps. It also forces you to wait, which is half the battle.
4. Stop from the chart
The stop goes where your idea is clearly wrong, set before you enter. Full guide: how to set a stop loss.
5. Size from the math
Example: risk $20, stop $0.40 away → $20 ÷ $0.40 = 50 shares. Hit the stop, lose about $20.
The position size calculator does this in seconds.
6. Target at least 2-to-1
If the next real level is too close, the trade doesn't pay enough for the risk. Skipping it is a good decision, not a missed chance. See risk-reward ratio.
7. The news
Big scheduled reports can move price fast, jump past stops, and widen spreads. In the US, CPI comes out at 8:30 am ET, and FOMC statements at 2:00 pm ET. Check an economic calendar before you start, and see CPI and FOMC days.
8. How you feel
This one is last on purpose. You can tick seven boxes and still be about to take a trade because you're frustrated or bored.
Be honest. If the answer is "I want to win back the last one," that's a sign to stop. More in revenge trading and FOMO trading.
What if I get a "no"?
Mostly, skip the trade. A skipped trade costs nothing. There will be another one.
Sometimes you'll take it anyway. If you do, write it down: which box was a no, and why. That's not a punishment — it's data. After 20 or 30 trades, your journal will show whether "no" trades do better or worse than full-yes trades. Usually, that settles the question for good.
Tip: add a column called "Checks passed" to your journal, like "8/8" or "6/8." It's one of the most useful numbers you can track.
Make it your own
This list matches a simple method: trade with the bigger chart, at real levels, after a body close, with fixed risk. If your plan has other rules, swap them in. Keep it to six to eight questions. Longer lists get skipped.
Two things should always stay:
- A risk check (stop and size).
- A state check (how you feel).
Common mistakes
- Running it after entering. It only works before.
- Ticking boxes without looking. Each question needs a real glance at the chart.
- Making it too long. Twenty questions means you'll check none.
- Dropping the feelings question. It's the one that catches the costliest trades.
Try it today
- Copy the eight questions onto a card or sticky note.
- Open a past chart in replay and look for three trades.
- Run the checklist on each before "entering."
- Log how many checks each one passed.
Our free chart tool on TradingView marks the last turning points, which makes questions 2 and 4 quicker: add the StructureX indicator.
Questions
What should I check before entering a trade?
The bigger chart's direction, that price is at a real level, a candle body close past it, a stop set from the chart, size from the math, a target at least 2-to-1, no big news soon, and that you feel calm.
Why use a trading checklist?
It catches the common in-the-moment slips, like a missing stop or a trade right before news, in under a minute. Pilots and surgeons use checklists for the same reason.
How many items should a pre-trade checklist have?
Six to eight is a good range. Enough to cover direction, level, risk and your state of mind, short enough that you'll actually use it.
Should I skip a trade if one box is a no?
Usually, yes. If you take it anyway, note which box failed in your journal. Over time you'll see how those trades compare.
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