Who this is for — Traders who improvise with open position. Scenario pre-decides reactions — does not predict market.
A scenario is the post-entry if-then map: if price does X, you do Y. You do not control outcome; you control response with rules written before stress.
In plain terms — Three scripts ready: boom, stall, crash — you know which action fires without negotiating with live chart.
Three standard scenarios
| Scenario | If | Then |
|---|---|---|
| Best case | Fast +1R/+2R | |
| Base case | Sideways X candles, no momentum | Reduce risk or scratch |
| Worst case | Structure break / news | Stop in place, zero moving |
Why it matters
- Removes panic and «wait for it to come back»
- Links trade idea to active management
- Each branch verifiable in journal
Typical mistake — Only best case in mind: base case (chop) becomes infinite hold or revenge.
Example — Long: IF +1.5R in 2H → close 50%, BE on rest; IF 4H flat → exit BE; IF close below invalidation → stop.
Summary sheet
- When: written in trade idea pre-click.
- Focus: your actions, not forecast.
- Minimum: 3 if-then branches.
Silver path — Setup module. Index: Silver path.
Links
Sources
- CME Group, Building a Trade Plan — structures objectives, methodology, risk management, and scenarios before a trade.
- CME Group, Trading strategies in your trade plan — connects setups, conditions, and exit rules to a written plan.
- Investor.gov, Understanding Order Types — explains how order type and liquidity affect observed execution.