Lesson 5 — Plan, trigger, target, invalidation

An idea isn't a trade until it's written down with four things. This is the vocabulary the watchlist, journal, and trade log share.

The four fields

• Trigger — the level that puts the idea in play. Usually the break that completes the pattern from Lesson 4. Bullish trigger above; bearish trigger below.
• Targets — where it's going if it works. Often the other side of the range, then the next timeframe's extreme. Label them in your own words: "prior week high," "gap fill."
• Invalidation — where the idea is wrong. If price gets here, the reason you took the trade no longer exists.
• Thesis — why, as an if-then chain: if the weekly holds, then a daily 2u confirms, then the 60-minute needs to agree. Three to five connected confluences make a thesis. See Thesis chains.

Why the plan comes first

Because the review only works if there's something to review against. "Did I enter at the trigger?" is unanswerable if you never wrote the trigger down. The plan is what makes losses informative.

Execution, not outcome

When a trade closes you grade the execution: did you follow the plan you wrote. Then four questions — was the chain valid, did you enter at the trigger, did you honor invalidation, did the signal's timeframe match your hold. A losing trade with four yeses is tuition. A winning trade with a no is a mistake that paid.

We don't grade trades by a ratio of what you'd win to what you'd lose. We grade whether you did what you said.

Sizing

Sizing is a process principle, not a formula in these lessons: size so that honoring your invalidation is easy. If you can't take the invalidation without flinching, you're too big. Platinum members work on specifics with their mentor.

Where you see it in the app

• Watchlist cards hold all four fields and draw them on the chart.
• Push to Plan puts the idea in today's journal; Take This Trade opens the trade form with the fields already filled.
• Grade on close and the process review happen in the Trade Log.

Do this today

Take one idea from your top-down and write all four fields before the trigger hits. Paper trade it. Grade it honestly. That single loop — plan, trigger, review — is the whole method; everything else in the app is there to make it easier to repeat.

Back to The first five lessons.