TRADING GOAL (Achievement Process)
$300/day    $1500/week     $6K/month      $70K/year
This is a rather ambitious goal given a $40,000 account and that you have not in the past been very profitable. This represents a return of about 15% per month. I think that it is more realistic for equity traders to get a return of 7.5% to 12.5% a month. This is not to say your goal is not possible, simply that it will be very hard to reach and that might cause some undue stress.

RISK TRADE
One half percent (1/2%) on $40K account per trade or $200/trade
e.g. 50cent stop allows 400-share trade.
I would also want to have a daily, weekly and quarterly risk amount put in. Should this be exceeded you may consider not trading again until that period ends. This is less important as you gain more and more experience and have a lot of success to fall back on, but in the beginning large draw downs can be devastating. Something along the lines of 3 to 5% a day, 10 to 12% in a week, 15 to 17.5% a month etc. Again this is not something that is absolutely required, but is should be considered.

TRADES
4 trades per day (max) Overtrading loses more $ than it makes. 4 Trades at ½% risk is more than adequate to achieve the daily and weekly goal.
Sometimes under trading is also a problem. Because of the format of the chat room we do not give a large number of trades. In my own trading I tend to make 8 to 12 trades a day. You do not want to pass up on a valid opportunity simply because it is outside your max. trades per day. Some of the better traders I know actually have a lower limit, ie. I will trade at least 3 times a day. This may not be appropriate for you, it is, however, something to consider.

I would write out specifically what specifies a trade, ie, in what circumstance you will or will not trade any given setup.

Day Trades will not be countertrend to indexes – longs trades taken with up trend markets and shorts will be taken with downtrend markets as revealed by TRIN and TICK and Price Movement of SPY, QQQQ, DIA This EDGE is required.
You need to define your timeframes here. In any given situation the market will be in an uptrend, downtrend and sideways trend all at the same time, but in different timeframes. Also, it is important to realize that this criteria may prevent you from taking many of Toni’s trades, as she is more of a reversal then continuation player.

All Day Trades will be Trades called by Toni or Brandon. No Day Trades will be taken independently for month of November. This EDGE is required.
This is fine for now. Eventually your goal should be to be finding your own trades independent of anything Toni or I do. For a beginner the only profitable way to use the service, IMO is to pick one of us and follow that person. However, as you gain experience it becomes viable to take things given by any/all of us so long as they fit into your plan. Once you gain some experience, if you use us at all, it should only be as an extra set of eyes.

Trades taken will be shared with Toni as it is in play and questions asked for any concerns. Each trade will be reviewed for questions to Toni after the trade is closed if questions arise in execution or chart pattern. Lessons learned will be noted on Daily Trade Journal. This EDGE is helpful for next trade.
Very helpful for the first month or two, however once you get into your program etc, you will need to be defining your own concerns etc. Successful trading is a very personal issue and will not be the same for you as it is for myself or Toni.

SETUPS
All setups involve an initial explosion with expansion bars, confirmed by heavy volume. Then some form of pullback/correction/congestion with lighter volume and smaller bars. Trigger involves a resumption of direction and core buy/sell entry.

PATTERNS TRADED
Trades will be 2nd Wave and 3rd Try setups.
Trades of 3rd Wave must be called by TFMS and half lots
While some of my trades are done with “half lots” (ie if my normal size given the risk would be 2, on that particular trade I would do a 1 lot) something you should really consider is the question “If its something I am only considering a half(assed) commitment too, is it really worth the trade at all?

No Scalping trades from 2 min or 1 min charts for set up.
When I think of a “scalp” setup, it has much less to do with the timeframe I take the trade from, then how the trade is handled once it is open. Profits are taken on scalps as we get the initial momentum surge, and no room for a pullback is given. This is more about style then timeframe. Also, do not completely neglect the shorter term timeframes as they offer wonderfully sharp entries for trades on bigger picture timeframes.

Entry is 5 points beyond Set Up breakout
Exit is fades Target by 3 to 5 points

2B will not be traded but watch for second entry from another pattern.

BINDER containing these patterns with notes on each will be used for daily reference. Notes from lessons and added copies of charts with trades from this pattern will be also collected. More charts will be added as month progresses to each pattern section.

SUMMARY of trades will include Type of Pattern for evaluation of most successful trades and which patterns work best/worst.
Stops are much more important and offer the best opportunity for learning. Plan to spend about 70% of your time analyzing your losers, and only about 30% on the winners.

QQQQ, SPY, DIA will be traded but if execution becomes a problem for entry and exit, supporting stocks will be used in called trades (GE, MSFT, etc.) And discussion with Toni will be sought for help and solution of execution. I would avoid these all together. If you want to trade the indexes it should be done with futures, period. If you are trading bullflags, bearflags etc watch the top issues. When a bullflag (for example) is called in the SP500, look to take the strongest stock in the strongest sector long if it has simply based up near its' highs etc.

SWING TRADES
One swing trade at any time will be one trade maximum in play and will be only 200 shares for month of November. Partials will be taken as is reasonable with stops covered. I will continue to maintain Farley watch list and work independently on this project.
I find it much less profitable to take partials on swingtrades, for me a better alternative is to simply move my stop up. This may not be the case for you though.

DISCIPLINE ALLOWS THE EDGE TO WORK
Discipline means to me personally:

1- Not trading when market dictates such as:

Days without determined direction. What are you going to use to determine direction?
Days of extreme overbought/oversold and no commitment. Again, how do you define this specifically?
Days of NR7. An NR7 can not be defined during the trading day, but only after the close. Many times a day will be narrow, but then a strongish breakout will take plays later in the day.
Days of doldrums. I would assume by this you mean things like major Christian, Jewish and national holidays when volume is light, or the market is only open half the day. In most cases this is an excellent plan. You might, however, want to consider trading the day before and after Thanksgiving and the week of Thanksgiving. I personally do not always trade these weeks simply because the market is always there and it is important to me to be with my family. However, these days tend to be some of the biggest of the year. I have made 40% in half a day, and many others I know have as well.
Lunchtime doldrums. One thing I would note here is that on days the morning range was very narrow, we often see great trading over noon. So this is something that’s like, ”I will never trade in the doldrums except when I should”
Intraday lack of volume or expansion. Each day of the week, time of the month and period of the day has different volume and range traits. Be sure you know them before you make any business plans based upon them.
End of day exhaustion when market needs a rest. How do you define this “needs a rest”? For example, what if the market has had 5 NR7’s in a row, but then had an explosive move into the last 45 minutes of the day. What would you do tomorrow?

GOAL to identify and keep record of these times and learn to stand aside.

My Plan means I am a successful trader when I stand aside and refuse to trade.

2- Maintaining & Honoring STOPS

3- Taking profits when price hits Partials and Targets

4- Learning to avoid temptation to Over Trade in Times of both Excitement & Doldrums

- Trading Zone by Mark Douglas
- Trading Zone by Dr. Kiev (IMHO, Kiev’s best book is “A Strategy for Daily Living”, it is not specifically about trading, but is one of the best books I have ever read for a trader)
- My Trading Room by Elders. I would also consider adding “The Way of the Warrior Trader” by McCall. Also, working with a trained sports psychologist was the single most powerful, and smartest thing, I have ever done for my trading. There are a number of books on this subject. They are 1000 times better then anything written for or about trading. They are things that actually work, not some jargon by a washed up trader trying to sell you nonsense.

“Winning Ugly: Mental Warfare in Tennis” Brad Gilbert
“ Sports Slump Busting” Alan S. Goldberg
“ The Mental Edge: Maximize Your Sports Potential with the Mind-Body Connection” Kenneth Baurn

I would also strongly urge you to read “The Art of War” and “A Book for Five Rings” Read the original “warriorship” versions, not the ones written by someone to about modern business or trading. Read them and develop your own interpretations and applications.

Setups and Patterns as taught by TFMS
- Maintain copies of Notes of lessons and classes in 3-ring Binder
- Make notes of daily mini-lessons given during the day
- Type up and store in binder specific comments on each pattern traded.
- Collect and print up a variety of examples of charts of each pattern traded
- Review each day – A specific pattern with charts and notes.
- Review weekly Patterns traded.

For sharper trading.
Decide on a routine of walking, aqua-exercise, and exercise routine.
Write program and keep diary of exercise activity.

Read HRE outlook & TFMS nightly review/outlook.
Review Swing Trade watch list and alerts.
Review Sector and Index charts.
Check News Watch.
List any Stocks to Watch for Next Day.
Read and Review Business Trading Plan and Goals.

6:00 am    Rise, Shower, Dress
6:30 am    Computer Station, check market, review TFMS watch list (pick 3)
7:30 am    Market opens

Midday    Used to watch market and review lessons and type notes
                Read books with notes

2:00 pm    Market closes
                 Summarize trades and P/L
                 Leave house for an hour; get outside, do errands, exercise

I always find it very important and helpful to work towards something larger, not simply a paycheck. Maybe you want to go on a cruise with your wife, or buy a horse. Something that is a “treat”. Trading is very stressful, and you must reward yourself well and often or you will not be able to maintain the motivation required to succeed.

Overall this is very good. My suggestions are just that, and please do not feel like they are required. It is obvious you have put in a lot of thought and work to your plan. Good luck.

Brandon