Trading Rules: A Discipline-First
Approach to Consistent Profits
By, Michael Schwartz
Built for momentum scalping with surgical precision and self-accountability
Document Version: 2.1 | Last Updated: 05/13/2025
✍️ FROM CHAOS TO CLARITY
These rules didn’t come from theory. They came from blown combines, reset funded
accounts, and the gut-wrenching moment where I finally asked myself:
“Am I trading with discipline—or just throwing darts with hope?”
I used to think taking every loss personally meant I cared. But over time, I realized it was just
slowing me down. Journaling taught me more about myself than any setup ever did. I never
blamed the market. I blamed myself. And that was the first real shift.
Let me ask you:
● How many combines, funded accounts, or personal accounts have you blown?
● How much money have you burned chasing this?
● How much more are you willing to lose before you take it seriously?
And if you’ve got a family:
Are they willingly walking this journey with you—or are you dragging them through
it without a seatbelt?
That’s not just a trading question.
That’s a life question.
Your kids don’t understand.
They just want to know what’s for dinner.
You have to be the provider, the protector, the plumber, the therapist, the damn theologian if
need be.
We don’t get to play around.
So when does this stop being gambling—and start being a grind with purpose?
My win rate is 73.3%. That means I’ve proven I can be consistent. But consistency doesn’t
mean a damn thing without discipline. And without discipline, that consistency? It won’t last.
At some point, you’ve got to get serious:
✅ Pre-trade checklist
✅ Post-trade journaling
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✅ Real-time self-audits
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✅ A hard, honest system
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Otherwise?
You’re not trading.
You’re just spinning the wheel—and calling it strategy.
🎯 WHY THIS STRATEGY WORKS
This system is designed to eliminate decision fatigue, reduce emotional interference, and
maximize consistent, compounding results. If you treat trading like a business, this is your
operating manual.
✅ MORNING PREP CHECKLIST
Start your day grounded and sharp. Every trading day starts with this—no exceptions:
● ☐ Reviewed yesterday’s journal?
● ☐ Key levels marked? (Support, resistance, gaps, ON highs/lows, news events)
● ☐ Volume profile and order flow magnets identified?
● ☐ Assessed market volatility & sentiment? (VIX, global markets, econ calendar)
● ☐ Mental state: Calm, focused, detached?
● ☐ Committed to one trade at a time?
✅ DAILY STRUCTURE
A simple structure to remove decision fatigue and keep risk in check:
● Intraday Session: Trade until $200 profit or $200 loss — then stop. Bracket orders
remove hesitation and protect your edge.
● Overnight Session: Only if intraday closed green → same $200 win/loss rule.
● Daily Cap: $400 profit or $200 loss — whichever comes first.
🧠 A+ TRADE CRITERIA (ALL MUST BE MET)
No guessing. No maybes. If it’s not A+, skip it.
1. Momentum Confirmed:
○ Strong breakout or breakdown with 2x volume (vs. last 5 candles)
○ Order flow shows aggression (bid stacking for longs, ask liquidation for shorts)
2. Structure: No chop — tight pullback to EMA 8/21 or high-volume node (HVN)
3. No News: Avoid trading 30 minutes before or after major news events
4. Defined Risk: $200 stop, $200 target — adjusted only to lock in profits once trade goes
green.
If all criteria aren't met — it's not a trade. Protect your capital like it's your last dollar.
🚫 NO-TRADE CONDITIONS:
Walk away if any of these are true:
● Emotional state: Rushed, greedy, or distracted.
● Intraday loss = Day over (no overnight trading).
● Market environment: Choppy, news-driven, or unclear momentum.
⚡ EXECUTION PROTOCOLS
● Entries: Market orders only — after clean momentum confirmation.
● Exits:
○ $200 stop market (no exceptions)
○ $200 take profit (limit order — no trailing)
○ Move stop to +$100 when trade hits +$135
○ Never let a green trade go red
♻ MONTHLY RESET RULE:
🔁 Review full journal & performance metrics
🧠 Identify recurring mistakes or emotional patterns
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🛑 Take one full day off per month to reset
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🔧 Only adjust strategy if rule breaks or slippage are happening
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✅ TRADE MANAGEMENT:
● Max Daily Profit Target: $200 → Done for the intraday session
● Max Daily Loss Limit: $200 → No more trading for the day (includes overnight)
📉 FAILSAFE PROTOCOLS:
❌1 intraday loss = no more trading that day, including overnight
❌ 3 red days in a week = 48hr break + SIM drills
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❌ No revenge trades — ever
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❌ If first trade is red: no second chances. Day's over.
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✅ Rules protect consistency. Don’t bend them.
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⚔️ MOMENTUM TRADE LOG (QUICK JOURNAL)
Emotional State: ____________________________
A+ Setup: Yes / No
Reason for Entry (Confluence): ____________________________
P&L: $_______
Stop Moved to Lock In Profits? Yes / No
Rule(s) Broken? Yes / No – If yes, which? ______________
Lesson Learned: ____________________________
Done for Session? Yes / No
Final Thought for Today: ____________________________
