Home / Tips / How To Use A Trading Watchlist For Better Results [Free Download]

How To Use A Trading Watchlist For Better Results [Free Download]

Tradeciety_watchlistA big part of trading success and profitable trading is the ability to organize yourself and to follow a structured routine. A solid trading routine will not only save you time, but it also provides guidance and support when the going gets tough and when you have to make difficult decisions during live markets.

To establish a professional trading routine, traders can make use of a variety of tools and helpers. On Tradeciety we offer a free trading plan template, a watchlist, a trade checklist and two trading cheat sheets (download link is at the end of this article). Today we are showing you how to use the watchlist effectively to make better trading decisions during your live trading and how it helps you to find better trades while avoiding mistakes.

 

What is a trading watchlist?

In your trading watchlist you write down all the markets and instruments you trade and which you want to keep a close eye on because you see something interesting. A watchlist, typically, contains setups which are almost ready to take but where a bit more waiting is required.

During your active trading sessions, you place your watchlist next to you and wait until the conditions are met. The goal of the watchlist is to minimize distractions and to help you make better decisions based on your analysis and avoid impulsive decisions.

 

Watchlist vs. trading plan

A trading plan and a watchlist have roughly the same goal but you can use them together to leverage the benefits of both. In your trading plan you perform a more detailed analysis of the markets you trade and you map out your trades in more detail. The watchlist, on the other hand, only contains very few details about potential trades. A watchlist, thus, condenses the information of your trading plan.

A trader first performs a detailed analysis of the markets he trades and writes down his findings in his trading plan and then just lines out the trade ideas in his watchlist.

 

Getting to know the Tradeciety watchlist

For each potential trade idea or setup you see evolving, use a separate row in the watchlist. First, enter the market (instrument) you are watching, the date when you added it to the watchlist, the potential setup and some additional notes for your references.

Then, you get to the Ready-O-Meter. This feature helps you process the information in your watchlist much faster. Depending on how close the setup is to actually entering a trade, you check off the individual boxes. If the setup is still far from triggering a trade entry just check off the first one or two boxes and as price keeps moving and coming closer to meeting all your entry criteria you check off more boxes until you reach the last one which signals that you need to enter a trade.

The Ready-O-Meter visualizes the progress of a potential trade. Traders who follow this approach and who can actually see how far their setup is, are less likely to break their own rules and are more likely to wait patiently until all their criteria are met. Making an active decision that clearly violates your rules is harder to justify if you have the information right in front of you.

Tradeciety_watchlist-2

 

Get your free watchlist now

Support us by sharing this article or follow us on our social media to unlock the free downloads instantly. You will also find the downloadable files for the trading plan template and the other tools below.

 

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2 comments

  1. Hi Rolf, great article! I was wondering what would be the examples of trading criteria in order to check the boxes toward a completed trade entry?

    • Hello Iwan,
      this is very strategy specific so in my case I wait for price to reach a key level, show signs of turning momentum, the break of the 20SMA and a few other things. Basically, your system’s criteria and what would get you into a trade.

      Rolf

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