Trading rules: how to write rules you'll actually follow (with examples)
Every trader I coach has rules. Almost none of them follow them. Not because they're weak, but because the rules are written so they can be argued with in the moment. Here's how I get students to write rules they actually keep, with the 12 I see work most often.
The short version
A good trading rule is specific, has a number in it, and is either kept or broken. "Don't overtrade" is a wish. "Max 3 trades a day" is a rule. Write a few of those, check every trade against them, and put a dollar number on every break. That last part is what finally makes traders stop.
- They use words like "try to", "avoid" or "don't overtrade"
- You can't say after a trade whether you kept them
- You have more than 10 and can't remember them in the moment
- Breaking one never costs you anything you can see
- Each one has a number: a dollar amount, a count or a time
- After every trade you can answer kept or broken, no debate
- You have a handful, and they cover risk first
- You see what each break cost you, in dollars
Why most trading rules fail
The rules aren't the problem. The problem is that they're written for the calm version of you, and broken by the version that just took two losses. In that moment, any rule with wiggle room gets reinterpreted. "Don't revenge trade" becomes "this isn't revenge, it's a real setup".
So a rule has to be something you can't argue with at 10:14 in the morning with your heart rate up. That means a number, and a yes or no answer.
How to write a rule you'll keep
- Put a number in it. A dollar amount, a count, a time or a size.
- Make it binary. After the trade you can say kept or broken, nothing in between.
- Say what happens when you hit it. "Daily loss limit $500, then I close the platform" beats "daily loss limit $500".
- Keep the list short. Five rules you follow beat fifteen you don't.
- Risk rules first. Setup rules matter, but risk rules are the ones that keep you in the game.
12 trading rules that work
| Rule | Example | What it stops |
|---|---|---|
| Daily loss limit | Down $500 on the day, I stop | One bad day wiping out a good week |
| Max loss per trade | Never more than $200 on one trade | The one trade that ruins the month |
| Max trades per day | 3 trades, then I'm done | Overtrading and boredom trades |
| Max position size | Never more than 2 contracts (or 0.50 lots) | Sizing up to win it back |
| Stop after losses in a row | 2 losers in a row, I stop for the day | Tilt and revenge trading |
| Cooldown after a loss | 15 minutes off the screen after any loss | The instant re-entry |
| Trading window | Only 9:30 to 11:30 New York time | Chop trades in the lunch hours |
| Allowed markets | Only NQ and ES | Jumping to whatever moves |
| Daily profit stop | Up $1,000, I stop | Giving back a great day |
| Daily give-back limit | If I give back half my peak day, I stop | Green days turning red |
| Weekly loss limit | Down $1,500 on the week, done until Monday | A bad week becoming a bad month |
| Risk in R | Every trade risks 1R, R is $100 | Random position sizes |
You don't need all twelve. For most traders I start with three: a daily loss limit, a max number of trades, and stop after two losers in a row. Those three alone stop most of the damage I see in students' journals.
Setup rules: when you're allowed to trade
Risk rules say how much. Setup rules say when. Write your setup as a short checklist with things you can see on the chart, not feelings. "Price retests the level and holds for one candle" works. "Strong momentum" doesn't.
Then grade every trade against it. A trade that met every point is an A, even if it lost. A trade you took without the setup is an F, even if it won. That separates good trading from lucky trading, which the P&L alone never will.
How to actually stick to them
- Check every trade against your rules after the session, not just the bad days.
- Count stopping at a limit as a kept rule. Stopping at your daily loss limit is the rule working.
- Put a dollar cost on every break. "I broke my max trades rule 6 times this month and those trades lost $1,840" hits harder than any promise to do better.
- Work on one rule at a time. Pick the one that cost the most and make it the only focus for the week.
That's what Actal is built for. You set your rules once (all twelve above are built in), and every trade you import is checked against them. Breaks show up with what they cost, and the most expensive one becomes your focus for the week. It's free while in beta.
Who wrote this
I'm Joakim. I trade index futures full time and coach traders one-on-one at Jusell Trading Academy. The rules above are the ones I see make the biggest difference in students' results, not a list from a book.
Questions people ask
Drop in one export. In a minute Actal grades the trades it can, prices the mistakes you tagged, and tells you the first thing to fix. Free during beta, no card.
Full-time index futures trader. Coaches traders one-on-one at Jusell Trading Academy, five students at a time, since 2020. No platform was built for developing traders, so he had his own coaching software built; old students loved it and kept coming back, and Actal is that software turned into a proper journal for what matters.