Sam’s Trading Plan
I trade because I enjoy the challenge and because I love the freedom it affords me. I get to be my own boss and my success is determined by how good my trading plan is and how well I follow it. The opportunities are limitless.
My approach is to find setups that can work on multiple timeframes and take the low hanging fruit with the idea that the setup remains valid for multiple entries.
Monthly: My monthly goal is to make 25% of my account NLV. Whenever I double the original account size, I withdraw half and keep the original stake in the account.
Yearly: My yearly goal is to multiply the original stake in my trading account by 5-10x. By following my monthly goals and trading plan it is possible to grow a small account this way.
Long Term: My long-term goal is to earn enough from the markets that I trade only for enjoyment and not for income. I will likely trade for the rest of my life, but my goal is to be able to walk away at any time if I ever chose to. I love trading, but one thing trading has taught me is that you have to be able to walk away when your targets are hit.
My long-term objective with trading is singular: to take what I pull from the market over the years and build an animal sanctuary that has enough resources to never turn away an animal in need.
The markets that I trade are options primarily, stocks, futures, and crypto.
I will trade any timeframe as long as the setup is quality. My favorite are the daily, 195-minute, and hourly charts working in confluence.
- Enter at support for longs, or resistance for shorts.
- Typically, this is the 21EMA on whichever time frame I am trading.
- Enter before the Squeeze has fired, only enter if multiple timeframes have Squeezes.
- Enter at the top or bottom of the momentum cycle as shown in my momentum indicators to catch the intended swing with as much energy as possible.
- Longs should be clean with easy to see patterns. Shorts can be a bit messier on chart.
- Higher highs, higher lows for longs. Lower highs, lower lows for shorts.
- The timeframes should sing together, meaning that the daily and intraday time frames should be on similar momentum cycles.
- This increases the chances of the trade. The ideal trade has a large squeeze like a weekly or 3-day, a daily squeeze, and an intraday squeeze such as the 195-min.
- Understand the full risk before the trade is entered.
- Know where your profit target is and understand what conditions invalidate the setup
- Such as closing below support.
- I don’t typically have a hard placement on stops. I prefer the term “point of validity,” which is a term Raghee came up with. It restates the idea of a stop from a defined monetary stop to more setup based.
- If the point of validity is broken and the original setup that got me in the trade changes, I close the trade right away. If you got in on a 21ema pullback and price closes below that, that is point of validity.
- I typically will look to exit positions at Fibonacci extension targets or when the setup that got me into the trade originally begins to lose steam.
- I will close a profitable trade at either a defined Fibonacci price target or if the momentum structure changes, whichever comes first.
- I will not risk more than 10% of my account on any one trade.
- I will not take multiple trades that mirror each other: QQQ & AAPL for example, these two products will typically track each other and stacking trades in both can lead to outsized risk. Choose one or the other.
- I am happy to take a stop on a trade if it breaks the structure that originally got me into the trade.
- Check levels on overnight futures. S&P / Nasdaq / VIX / Bonds
- Check overnight trade in Europe and Asia for sentiment.
- Check premarket pricing for any positions I am in and update my exit orders if something has changed.
- Write down my notes for the day; organizing thoughts on what markets matter that day, what stocks are moving, and what internals to focus on.
- Update price levels on intraday index charts for live trading.
I run my market-wide checklist, checking in on every major market after the close. This includes writing a one sentence summary of that particular market and its directional bias and any setups I see. Doing the checklist after the close allows me to touch base on every market I deem important and creates a visceral connection from mind to paper for the next day’s trade. This is one of the most important things I do. Having this understanding of cross markets after the close, but before the next open, gives me confidence that I haven’t missed something as the opening bell sounds.
I find new symbols to trade by running both the Simpler Trading scanner and running for specific momentum scans I have created. I find new symbols by running a prop scan within ToS, looking for specific parameters such as active squeeze and momentum turning. I look for patterns to appear on the momentum scan such as many stocks from a specific sector all showing up which indicates the sector is worth paying closer attention to. By doing my post-market checklist nightly, I also have an understanding of what sectors are in play and by focusing on the strongest sectors exclusively, I can then more quickly jump from sector to stock.
- Simpler Trading Scanner
- FANG Index (index that I created that weighs the FANG stocks by market cap and balances for prices, invaluable resource as it gives deep insight into the largest stocks while removing the noise from the rest of the market)
- CML Viz
- ForexFactory.com calendar
- Estimize / IBD
Why I use Squeeze Pro: I use Squeeze Pro because I have not found a better indicator to show when a larger than expected directional move may be about to happen. This is one of the most important parts of options trading and the Squeeze Pro captures both volatility and direction in one incomparable indicator. It’s a must have.
Why I use Multisqueeze: I use Multisqueeze because, at a glance, it allows me to see on what timeframes a stock has a fresh squeeze setup. This saves me about 1-2 minutes per chart, and I review 50 to 100 charts a day, so it’s an invaluable timesaver.
Why I use the 8 & 21 EMA: I use the 8 & 21 EMAs because they have proven to be significant Fibonacci-based moving averages, especially for swing trading. The 8ema is an aggressive trend and the 21ema tends to act more like “home base” for most solid trends.
Why I use the 50, 200 SMA: I use the 50, 200 SMA as benchmark moving averages that can act as support or resistance over a long sample. Also, these longer-term moving averages whether they are stacked or angled up or down tell me what the longer-term trend of a stock may be. I have found these two moving averages to be the most important long-term averages.
Why I use the ST_RangeStochastic: I use the ST_RangeStochastic because it is a very helpful momentum oscillator within the content of choppy, or range bound, markets. The RangeStochastic allows me to pinpoint turns within a choppy or sideways market. It also exhibits very specific behavior (holding above the upper or lower lines) when a stock is trending, so it works in both sideways and trends, but excels in chop.
Why I use the ST_Trend_Oscillator: I use the ST_Trend_Oscillator as a momentum indicator because it is helpful with trending markets. I want to see both lines above the middle and the fast (yellow) over the slow (red) with both trending higher to confirm a strong bullish trend. The combination of ST_RangeStochastic and ST_Trend_Oscillator gives me either a hammer or screwdriver in terms of understanding momentum, regardless of what the market is doing. It is imperative to understand the Achilles Heel of your indicators and these two momentum indicators when used together allow me to understand chop or trend.
- Screenshots with annotations saved in a folder
- Handwritten trading journal with date/position/price/setup/psychology of the moment
- “The first rule of any game is to know you are in one.”
- Anything can happen in the market. Absolutely nothing is guaranteed.
- It is important to remember that and to respect the market.
- The market will be as exhilarating or as dull as you wish. Our job as traders is not to find excitement. Oftentimes, the best trades are repetitive. We cannot control how the market behaves, but we can fully control how we choose to interact with it.
- Qualify your setups. We all have what we consider A+ setups, A-, B setups, etc…. Trade A+ setups more strongly than you would trade lesser ones. Think of them like a card count in your favor in Blackjack.
- Consider not trading anything below a certain setup criterion, i.e. no trading B setups… Only A+, A, A-, etc.
- Trading is more about filtering out noise than anything else.
- Preparation and luck, from the outside, look similar.
- The value of being flat and clear headed is understated.
- Try new ideas out in a live environment with a very small size. Treat the idea as a test of maximizing the best entry, exit, and prices despite the small size.
- Always understand your full risk before you enter a trade. Acknowledge it out loud if this is a problem. Say I am risking “X” in this trade out loud so that it becomes real. It is easy to have visions of Vegas and The Mirage. However, pros look at risk first.
- No big directional trades into monthly options expiration. Too often those days drain premium from directional trades.
- Do not diversify within the same sector. Buying multiple companies within one sector carries the same risk in this modern market as buying one big position in the strongest company.
- Remain unattached from the outcome. We will all have losing trades.
- The Game is not to get every trade right, rather to cut the losers quickly and let the winners run.
- Make time to take care of your mind. Spend time outside in the sun.
- Find time for quiet. Your mind is your instrument and your money maker, take care of it so it can take care of you.
- If you have anything very important or stressful in real life that is distracting, flatten out and handle real life first. The markets will always be there.
- Do things to dissolve your ego. The idea of self is an illusion.
- The universe will give you everything if you are truly unattached.