While we can’t know where prices will go, what the next breaking news will be, or how much profit we will make in our next winning trade there are a few things we can know:

1. We can know how big of a position we will take on our next entry.

2. We have to know where price will go to prove us wrong and cause us to exit a trade. You have to know where you are getting out before you get into a trade.

3. We should know how much we could lose if our trade goes against us and we are stopped out.

4. We should know the highest probability entries that we would take.

5. We should know the watch list that we will be trading from and not take any wild card trades before understanding chart patterns and historical price performance.

6. We should know what our total portfolio risk is at any one time if all our positions turn into losers at the same time.

7. We should understand how the leverage works before we trade futures or option contracts.

8. We should understand the potential maximum draw down of a string of losers based on our position sizing and winning percentage.

9. We should know whether the market we are trading is in an up trend or a down trend in our time frame.

10. We should always have a trading plan that tells us what to do based on what the market is doing. We should know how to react to each days price action based on our current positions.