I hope that by now I have convinced you that it is essential to keep a trading diary. Will you promise to keep one? If so, I’ll open my Outlook again and show you the exit diary. Take a look at Figures 3.6 and 3.7.
I believe that the best format for a trading plan is similar to the diary we have just reviewed. When you scan stocks, you can keep brief notes on the potentially interesting ones in a spreadsheet or on a notepad with three columns: Date, Ticker, and Comment. The idea is to narrow down your search to a few actionable stocks. Once you have a handful of candidates, it is time to work them up and create an action plan for each promising one.
When you find a stock that you think you might want to trade in the days ahead, create a plan for it using the same format as the diary, shown above. Capture a weekly chart using SnagIt, mark its signals with arrows and lines and write on it. Paste the chart with all the markings into a newly created entry in your Outlook Calendar. Now capture a daily chart, mark it up, and paste it into the same Outlook entry, below the weekly chart. Name that Calendar entry after the stock and label it as a planned trade so that you can easily recognize it. Save your newly created entry.
Figure 3.6 Trading Diary—DB, Exit, Weekly Chart
The weekly DB chart shows that the price dropped below the value zone, underneath ...

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