Day Trading Playbook
The edge isn’t a secret indicator — it’s a repeatable process you run the same way every day. This is that routine: premarket to weekly review, with hard risk guardrails and a pre-trade checklist. Each step links to the StockTools tool that runs it. Plan the day here; log the trades in your journal.
Decide what you would trade and why before the bell, so the open doesn’t decide for you.
- Check the calendar: earnings, and any scheduled catalyst that could move your names.
- Scan for real movers and name the catalyst behind each — no catalyst, no trade.
- For small caps, check dilution risk (active S-3), float, and halt history before you fall in love.
- Mark the levels that matter: prior close, premarket high/low, key support and resistance.
- Write the plan: entry trigger, stop, target, and size — on paper, before the open.
The first 30 minutes are the most volatile of the day. Confirmation beats prediction.
- Don’t chase a gap-up on the open unless it confirms continuation on real volume.
- Confirm relative volume is elevated — a move on thin volume rarely holds.
- Enter only your planned setup at your planned trigger; size by the stop, not by conviction.
- Set the stop the moment you’re filled. A plan without a stop is a hope.
Volume and range compress. The mistake here is trading out of boredom.
- Manage open positions to plan: trail stops, take partials at target, leave the rest alone.
- No new risk without a fresh, nameable catalyst — chop is not a setup.
- If a thesis breaks (the catalyst was wrong), exit; don’t average down a loser.
- Re-check red flags on anything you’re still holding into the afternoon.
The last hour trends. Decide what you carry overnight — and what you don’t.
- Power hour: let winners run to target, but tighten stops as the close approaches.
- Trim or close anything that didn’t work; don’t hold a loser hoping for a bounce.
- No new full-size positions late in the day unless the setup is exceptional.
- Decide overnight risk deliberately — earnings after the bell can gap against you.
The review is where the edge actually compounds. Skip it and you repeat the same mistakes.
- Log every trade in the journal while it’s fresh: what worked, what didn’t.
- Tag your mistakes honestly — chasing, no stop, no catalyst, oversize, revenge trade.
- Find the one repeated error costing you the most and write a rule that prevents it.
- Review whether the smart money (insiders, Congress, funds) agreed with your theses.
Size the position off the distance to your stop, never the other way around.
A common discipline is risking ~1% of the account per idea, and no more than ~15% of capital in one name.
Cap how many positions and how many new entries per week you allow — overtrading is the tax on boredom.
If you can’t name the specific reason a stock should move now, you don’t have a trade.
Adding to a losing small-cap turns a small mistake into an account-ending one.
The stop is the plan. Moving it because it’s about to hit is how good traders blow up.
- What is the specific catalyst, and is it confirmed?
- Where is my stop, and what is the dollar risk if it hits?
- What is my target, and is the reward at least 2× the risk?
- Is position size within my per-trade and per-name limits?
- Does the technical picture (trend, volume, levels) support the entry?
- Is there hidden risk — active dilution, a halt history, an earnings date?
Educational only — not financial advice, and not a promise of profits. These are common disciplined defaults; set your own rules to your risk tolerance. The market can stay irrational longer than you can stay solvent.