How to Document a Trading Strategy Step-by-Step

If you want to pass prop firm evaluations consistently, you need more than a “good feel” for the markets. You need a written, repeatable strategy. Documenting your trading strategy allows you to refine your edge, troubleshoot mistakes, and improve performance under pressure.

Step 1: Define the Setup

Start by clearly writing down your go-to setup. For example:

• Market: ES or NQ futures
• Condition: Breakout of 30-minute opening range
• Indicators: VWAP and 9 EMA confluence
• Entry trigger: Break and retest with volume surge

Step 2: Set Risk Parameters

Document your stop loss size, position sizing method, and max daily risk. For instance:

• Stop loss: 3-point hard stop
• Position size: 1 contract per $2,000 balance
• Daily max loss: 2%

This makes your strategy scalable across different prop firm account sizes, like Top One Futures or Bulenox.

Step 3: Map Out Trade Management Rules

How do you manage the trade once it’s open? Examples include:

• Partial take at 2R
• Break-even stop after 1.5R
• Time-based exit if price stalls for 15 minutes

Write this as if explaining to a junior trader who must follow it exactly.

Step 4: Define Your Filters

List what keeps you out of bad trades. Examples:

• No trades during high-impact news
• Avoid setups after 11:30 AM EST
• Skip if price is within 2 ticks of overnight high/low

These filters protect your stats during prop firm evaluations.

Step 5: Write the Playbook Entry

Put it all together in a one-page playbook format:

• Setup: Opening range breakout
• Context: Above VWAP, trending day
• Trigger: Retest with volume surge
• Risk: 3-point SL, 1 contract per $2,000
• Management: 2R partial, BE at 1.5R
• Exit Plan: Time stop or full target at 3R

Use Templates to Streamline Strategy Design

Prop Firm Press offers a Strategy Documentation Template designed to help traders build clear, repeatable plans for any firm. Use it to build your own strategy playbook.