If you read my post regarding the dreaded draw down or day trade slump you're well aware that you need to be evaluating your day trades at some point. This trading evaluation can happen day to day or possibly a better option, weekly.
You need to be asking yourself this very simple question. Am I still within arms reach of my trading plan? Do I still trade within this plan when I react to the futures markets gyrations? If not, have I reached my arm out to grab it and review it lately? Have I maintained my trade stops? If your answer is "no" or "Hey that's a good idea! Maybe I should make a trade plan and re evaluate my execution." then we're in trouble.
Remember all of that hard work you put in when the stock market wasn't open? The hard work you put in so that you may succeed? What are you doing when the market is open becomes a waste. The stock markets idea of fun is to throw those traders off who have no discipline. If you leave it in a folder tucked away in your desk it truly is doing you no good. If it seems daunting and long you may be over complicating what the stock markets trying to tell you. Break it down a bit and put it into bullet form so that you can find a place to post it up nearby your desk. Of course include your set us as well as trigger. Include what you will use as support and resistance. It may be a good idea to include some common mistakes that prevent your trades from working out. Understand how you determine entries, even if it isn't a strict exit plan.
In your plan include your analysis hard statistical data to give you the confidence to take the trade or hold off.. You've already done the hard work and remind yourself of your trade plan. Include your win:loss ratio as well as your average profit on each trade. You can even include the raw number of trades you analyzed in your back testing. These will help solidify its importance and create more confidence when placing the trade.
Remember to read it everyday or at the very least every week. Remember to do this on those days when you ruled the market and when your trading suffered. In this trade plan add a note for the wrap up of the day. You do this so you can log and track entries, exits, and results that may have stood out. Remember to include how many times your trade stop was hit in your analysis. Sometimes simply having a computer do it helps to hide your actual performance. Be as detailed as possible on why you entered into the market and why you exited.
What was your set up? What was your reasoning? How did I manage my risk on each particular day or swing trade? Will I move my trailing stop up quickly or wait for some sort of confirmation? How will I control my emotions and keep them in check when the market is all over the place? What do I do when the market is dealing out lessons to frustrated traders? This is what you will encounter everyday as a trader, thus you need to be aware of how you are reacting. Gain an understanding for your flaws and how you will react as the stock market stumbles and rises.
Eventually your mind will be trained to act accordingly and simply compute with no emotions. First though you must be aware and clearly define how you manage your trading style and emotions in and out of the markets waves. Eventually you will have to tweak this. Chances are this wont be just once, but 5-100 times through your career. This is simply how I explain my ever evolving trade plan.
FULL RISK DISCLOSURE: Futures trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.