Pulling the trigger checklist

This thread is designed entirely to help those who are perhaps new to trading or anyone who is eager to improve his/her performance ( who isn't!)

Before pulling the trigger on any trade, it is vitally important to know exactly why you are doing so in order to give yourself the best possible chance of a winning trade. There are many things to consider, and failure to do so will more often than not end up with a losing trade. So I thought it would be a good idea to list some of the things I consider precursory factors before I put on a trade. These, with time, should become part of your inbuilt wiring as a trader, rather than something you have to think too much about, rather like driving a car. Please feel free to comment and/or add precursors of your own. They are in no particular order of importance :

 

1. Why do you want to pull the trigger at this point? Is there a rational reason why other traders will also be looking to enter in the same direction at this juncture?
2. Is your trade going to be in the direction of the prevailing trend, or is it going to be against it?
3. If the trade goes against you, will you kick yourself, or will you be satisfied that at least the majority of the parameters that make up your strategy were in place?
4. Do you know where you will exit the trade, and if not, are you satisfied that the win/loss ratio is firmly in your favour?
5. Is your entry point within your risk tolerance zone - ie, if you enter here, is your stop loss going to be sufficient to ride out a temporary reversal against you?
6. Is there any other reason why you shouldn't really be entering a trade at this level/point in time?

Without running over the same ground, I think that is about it, for me anyway.