Eye rolls aside, I spring out of bed every morning, ready to hit the charts. It’s not because I have to…but I want to. For people like me who love trading, every day is a gift.
I get a lot of questions from Weekly Money Multiplier members about how I start my day. It’s a great topic that I wanted to cover. Your morning routine not only saves you time, but sets you up for success.
Everyone’s methods will be different. But, no matter how you trade, there are some core concepts that everyone needs: list of stocks to scan, market conditions overview, account review, and a journal review.
Every trader I know starts their day with some version of a stock screener. They look for stocks moving in the premarket, tickers that meet their preferred setups, or review companies they like to trade over and over.
I personally look at all of these. Stocks moving premarket can often create opportunities to ride the wave.
For example, I used large opening gaps in TSLA to buy options on a retracement for a run higher. This led me to one of my best gains in 2019. I watched and waited for an opportunity to employ my TPS setup.
I noted the trade to Weekly Money Multiplier members in the morning, laying out what I was looking at (something that’s also part of my morning routine).
The TPS setup worked off a clear trend higher, a nice pullback pattern, and a squeeze forming with the Bollinger Band indicator trading inside the Keltner Channel.
The results highlight how a morning routine can increase your profits.
The keys to a good stock scan include:
- Looking for stocks that meet your trading style
- Finding setups before they have a chance to play out
- Selecting stocks with enough liquidity so you can easily enter and exit the trades
Some folks find it tough to cut down on the stocks they look at. You can read my article Slim Down Your Watchlist With This Trick. It’ll give you some tips on reducing the number of stocks you scan through every day.
Getting a Feel For The Market
As a swing trader, I need to know how the general market looks. Most of my stocks trade similar to the Nasdaq 100, as proxied by the QQQ ETF. So, I want to get a sense of how that sector is trading.
First, I look at the longer-term picture to see what the overall trend has been. This means looking at the daily chart and sometimes the weekly chart.
Here’s a current look at the QQQ daily chart:
QQQ Daily Chart
When I see such a strong trend, I know I don’t really want to fight the bulls. So, I tend to look for long plays rather than short plays. If the market was in a protracted downturn, I’d look for short plays over long plays.
Next, I want to break it down to an hourly time frame. That lets me see how things have traded the last week or so.
QQQ Hourly Chart
Again, I see nothing but bullish behavior here. With such a strong trend in the short and long-term, I don’t want to really play any short trades or puts at all. It would be like salmon trying to swim upstream.
I always take a quick peek at my account. This isn’t to force me into monetary goals. Instead, I want to make sure that I’m sizing my trades appropriately. If my account has dropped in value, I want to scale down my trades accordingly.
This doesn’t take long, but is a big component of managing risk.
Lastly, I like to take time to review my journal. It’s the one thing that helps me improve as a trader more than anything else.
My journal lists out the trades I have on, as well as those I’ve completed. I want to identify any trends good or bad, mark out notes on what’s working, as well as write up any ideas.
Most mornings, I won’t do much more than update the journal and review my trades. However, I will do a comprehensive review once a week where I look at my overall performance. This identifies any areas that I need to work on or new ideas to try.
Putting It All Together
Trading requires you to bring together a lot of different ideas at once. It becomes like a golf swing…many moving parts…but you need to be able to work without analysis paralysis.
It took me a long time to get to that point. I have a webinar coming up where I explain how I created my TPS system along with the essential pieces I learned in my trading journey.