Plan the Risk Before the Reward

Write down the reason

Before any decision, describe what you are observing and why it matters. If the reason is only that someone else is buying, your own analysis is missing.

Consider the downside

Think about the amount at risk, the exit plan and the effect on your overall capital. A stop order is not a guarantee of the exact exit price, especially during gaps or fast moves.

Make room for uncertainty

No chart pattern or indicator predicts every outcome. Costs, liquidity, execution and changing conditions can affect results.

Review the process

Record what you planned, what happened and whether you followed your rules. Review the quality of the decision as well as its outcome.