--- title: "The Pre-Trade Checklist" canonical: https://thestrat.ai/docs/trade-checklist/ updated: 2026-10-25 author: Alex Sopa (AlexsOptions) source: TheStrat docs (https://thestrat.ai/docs/) --- Tools for AI agents: https://mcp.thestrat.ai — see https://thestrat.ai/agents/ # The Pre-Trade Checklist By [Alex Sopa (AlexsOptions)](https://thestrat.ai/docs/alex-sopa/) · Updated October 25, 2026 **Definition** The trade checklist is a fixed list of eleven questions run before every entry: signals, continuity, magnitude, time, stop, and management plan. The checklist is mandatory; it is the trade. **When:** before every entry, on every timeframe. A signal called out by someone else is not a reason to enter; the checklist runs first, every time. ## The eleven questions 1. **How many actionable signals, and what are they?** Pull up month/week/day/60 at minimum and count. Name each one in TheStrat language: [hammer](https://thestrat.ai/docs/hammer/), [inside-bar](https://thestrat.ai/docs/inside-bar/) break, [simultaneous break](https://thestrat.ai/docs/simultaneous-breaks/). 2. **What signals get created if this works, or if it fails?** Always look one move ahead. If it works: an inside-day up may complete a weekly rev strat: a bigger signal in your favor and room to add. If it fails: an inside-60 long taken against weekly/monthly/daily down creates a rev strat down *with* continuity: a more powerful signal against you. See [create & negate](https://thestrat.ai/docs/create-negate/). 3. **Is the trade in the direction of participation-group control?** [FTFC](https://thestrat.ai/docs/full-timeframe-continuity/) up and long: yes. FTFC down and long: default no. Going against control means battling the larger participation groups: possible, but know what you are up against. 4. **Where is the broadening-formation magnitude, and can it change?** Locate the next major [reclaim level](https://thestrat.ai/docs/levels-of-reclaim/) and the prior scenario-3 high or low on the [broadening formation](https://thestrat.ai/docs/price-discovery-broadening-formation/). That distance is how far the trade can go before management starts. 5. **Is FTFC full or partial?** All four timeframes confirming, or only some; see [override](https://thestrat.ai/docs/override/). Full continuity is the highest evidence and supports larger size; partial continuity calls for smaller size. 6. **Momentum or retracement?** If the bar before the signal is green and the signal sits in that bar’s upper 50%, an upside break is momentum; if the prior bar is red, an upside break is a retracement (mirror for downside). The classification changes management: continuation trades trail wider, reversal trades hold a hard stop at the failure point. 7. **How much time until the signal exhausts?** A weekly signal late Friday has no time; a 60-minute trigger with 5 minutes left has no time. Prefer triggers early in the bar: 55 minutes on the hourly, the full month at the start of a month. Time means you can add, and shorter signals have time to reconfirm. See [exhaustion risk](https://thestrat.ai/docs/exhaustion-risk/). 8. **Where is the stop, the level of defense?** A specific price, not “around” a price. Define what proves the setup wrong before entering. See [stop losses](https://thestrat.ai/docs/stop-losses/). 9. **What is the management plan: add, reduce, or exit?** Written before the click: if price does X, do Y. Winning positions can be added to, reduced, or moved to cost; the plan preserves that flexibility. See [adding to winners](https://thestrat.ai/docs/adding-to-winners/). 10. **Does the trade line up with the broader averages and the sector ETF?** Long AAPL: check XLK, QQQ, SPY. Equities give layered evidence: market plus sector plus stock. Aligned is high evidence; out of alignment means either the trade is wrong or the stock has a [natural buyer or seller](https://thestrat.ai/docs/natural-buyers-sellers/) the market does not. See [know your ETFs](https://thestrat.ai/docs/know-your-etfs/). 11. **Where in the broadening-formation series is price?** Reclaim from the lows, reclaim from the highs, or coming off a recent higher high / lower low? Beginning of an expansion carries the most magnitude; the end nears exhaustion. Position in the series calibrates how aggressive management should be. [Figure: Question 2 on real data (Dow 20,000, January 2017): if the Tuesday daily works, it completes a weekly rev strat: a bigger signal in your favor.] ## Why it is mandatory The foundation of execution: use what is known to create winning positions, then manage from there. “We do not take losers. We do not hold losers.” The checklist is what keeps that promise. Combinations across timeframes are always preferred over single signals in isolation. ## Frequently asked ### Do all eleven questions apply to every trade? Yes. The list is fixed and runs before every entry, on every timeframe. Some answers reduce size or defer the entry (partial [FTFC](https://thestrat.ai/docs/full-timeframe-continuity/), little time left in the bar) rather than veto the trade outright. ### Is it ever ten questions instead of eleven? Both counts circulate; the same material is grouped as ten or eleven questions depending on how two of the reads are combined. The content is identical; this page lists eleven. ### Which question matters most? None can be skipped, but the second (what gets created if the trade works or fails) is the one that separates the checklist from a filter. Knowing both outcomes in advance means acting faster either way: adding when a bigger signal completes in your favor, exiting when failure creates a signal against you. **Related:** [Create & Negate](https://thestrat.ai/docs/create-negate/) · [Exhaustion Risk](https://thestrat.ai/docs/exhaustion-risk/) · [Stop Losses](https://thestrat.ai/docs/stop-losses/) · [Position Sizing](https://thestrat.ai/docs/position-sizing/) · [Fix Your Trading](https://thestrat.ai/docs/fix-your-trading/) **Back to:** [Actionable Signals →](https://thestrat.ai/docs/actionable-signals/) TheStrat was developed by Rob Smith. These docs are written by Alex Sopa (AlexsOptions) and quote his teaching.