Happy Monday, traders…

Jeff here.

Most traders try to protect their “trade secrets…” 

If they have a particular approach to the markets that give them an edge — they’ll guard that info like a mother bear protecting her cubs.

In that spirit, I’m actually a bit hesitant to share one of my secret trading weapons today…

But these days, I’m not just a trader — I’m your teacher — and I would be remiss if I didn’t let you in on one of the most important things I’ve learned in 25+ years of trading.

I remember it like it was yesterday…

In my early days as a floor trader on Wall Street, I was exposed to something that completely changed how I prepared for my trades.

A senior trader gave me a checklist to go over every Monday morning, one that would set me up for success throughout the rest of the week.

And in the decades since then, I’ve used this list every single Monday of my life. 

Trust me: If you follow these steps, you’ll be far more prepared — and perform better — than the 90% of traders who fail. 

With that in mind, let me show you my 6-step framework for Monday morning success…

Step #1: Build Your Weekly Watchlist

• You’re in a unique position as an options trader. Your opportunities to profit can shift rapidly, ranging from week to week and even minute to minute…
• Having a clear list of potentially tradable stocks at the beginning of the week sets the foundation for your trading decisions.
• The stock market is dynamic, with share prices shifting constantly. This means you should be updating your watchlist throughout the week, adding any names that present actionable trading opportunities.
• Regularly updating your watchlist ensures that you’re not caught off guard. You never know … A previously unnoticed stock can unexpectedly become the highlight of your week.
• Technical traders: Note the important chart indicators for stocks on your list. Things like moving averages, RSI, and key price levels can give you insights into potential price movements.

 Step #2: Review Global News and Macroeconomics 

• Major macro events can lead to some unbelievable, five-star trading opportunities…
• This is why you should be scanning major international news outlets on Mondays for significant events from the weekend that may influence the markets.
• Pay close attention to geopolitical events, such as elections, peace talks, or conflicts that could have economic repercussions.
• Investigate any major economic data releases from the past few days that might sway market sentiment (like the recent Consumer Price Index and Producer Price Index numbers).
• See if there are any big corporate announcements, especially from blue-chip companies or market leaders.
• Familiarize yourself with the calendar of events for the coming week, noting any scheduled central bank meetings or policy decisions. (There’s a hugely important Fed meeting starting tomorrow.)
• Highlight any anticipated earnings reports from major companies, as these could drive sector-specific movements.

Step #3: Analyze Your Charts

• As a short-term options trader, starting your week with technical analysis is crucial…
• Start by reviewing the previous closing data and performance of major global indexes and sector leaders (i.e. Nvidia).
• In the early trading hours, monitor for significant gaps, surges, or downturns in pre-market trading that can set the tone for the day.
• Look into the implied volatility (IV) levels across various assets, and check the CBOE Volatility Index (VIX) to get a sense of market sentiment.
• Keep a close eye on the performance of major commodities (like oil or gold) as they can have a huge effect on stocks and indexes.
• Consider the bond market and yield curves, as they can be indicators of broader market sentiments (especially with the Fed meeting this week).

Step #4: Go Through Your Open Positions

• If you’re holding positions open from Friday, consider the following…
• Look at each of your open positions, noting their current performance. Which are profitable, and which are running at a loss? (You should probably cut your losses.)
• Identify any positions that are nearing expiration this week, as these trades require your utmost attention.
• Examine the movement of the underlying assets of your positions. Are they trending as you anticipated, or are there any surprises?
• Review any options strategies you’ve used and determine if adjustments are necessary due to shifts in the underlying stock. 
• Understand the impact of time decay (theta) on your options positions. This is particularly crucial for positions that are close to expiration.
• Ideally, start reducing your risk over the weekend. I recommend employing a “Flat Friday” strategy…

Step #5: Lay Out Your Game Plan

• Think about great sports teams … Do they go into a playoff match without a game plan? No? Well, you shouldn’t start trading without a game plan either. 
• Avoiding hasty decisions. You shouldn’t decide what names to trade at the last minute on Monday morning.
• Every great trader I know plans their strategy before the week starts. Furthermore, most wake up hours before the market open to prepare.
• Set clear, measurable goals and objectives for the week ahead — both in terms of desired profit and acceptable risk.
• Decide proactively if you aim to open new positions during the week, or if you’re more focused on managing or closing your existing ones.
• Set aside time blocks for daily market analysis, trade execution, and portfolio review. Create regular intervals for mental breaks and reflection, ensuring you stay sharp and avoid burnout.

Step #6: Forget About Last Week

• Forget about your recent successes or failures … it’s a new week.
• Make sure that emotions from last week’s losses (or wins) don’t influence this week’s decisions.
• This doesn’t mean you should forget the valuable lessons learned from past trades. Keep those. It’s the emotions you want to dispense with. 
• You want to start each week with a fresh perspective, free from the emotional burdens of previous trades.
• Holding onto past emotions can ruin your mindset. A lack of confidence from past losses might prevent you from nailing a promising setup, while overconfidence can lead to rash decisions (and inevitable losses). 

I’ve had this same Monday morning routine for years, and it’s helped me thrive for nearly 3 decades as a professional options trader.

Get up early, get your mindset right, and get your game plan ready…

Then, it’s time to make some killer trades.

Happy trading,

Jeff Zananiri

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