It’s the last hour of the market day and you’ve got important work to do. You’re holding a bunch of long positions at various stages of development, with some paying off while others threaten to trigger sizable losses. Now is the perfect time to ask a series of questions to assess, and if necessary, adjust your exposure into the next opening bell.

1. Did you buy near support in quiet times or chase momentum with an emotional crowd?

It makes more sense to enter a stock, futures or forex play during a quiet consolidation than to chase momentum and break bread with a crowd of anxious speculators. The narrow tape lowers the odds that aggressive sellers will magically appear the next morning and force your position into the red.

2. Did you miss a profitable exit during the trading day?

Price action unfolds in definable cycles that can yield outstanding intraday exits. If you miss one, and that happens frequently when traders are multitasking a dozen scenarios, don’t worry because another one will come along if you’re patient. Holding overnight hits the reset button, often providing a fresh opportunity to exit at a maximum profit in the following session.

3. Is the broad market strong or weak into the close?

Watch SP-500. Nasdaq-100 and Russell-2000 index futures, or their related exchange traded funds. for clues about macro forces that will move the market in the following session. (See: Exchange-Traded Funds: Features .)Track these oscillations with 60-minute charts and 5-3-3 Stochastics, looking for rising indicators that predict higher prices in the morning, or falling ones that predict sellers will be in control when you’re drinking your morning coffee. (For related reading, see: Four Types Of Indicators FX Traders Must Know .)

4. What day is it?

Financial markets exhibit natural tendencies that shift with the day of the week, time of the month and month of the year. For example, seasonally tuned traders look for markets to reverse on Turnaround Tuesday, with continuation of a mini trend into Thursday, followed by a wave of high conviction that can yield profitable movement into the weekend. It’s always best to align short-term positions to these repeating cycles.

5. What’s on the calendar?

Make it a habit to review economic reports and earnings calendars for the following session to lower the odds for nasty surprises. In addition to specific news about your positions, like earnings releases, check for news on other sector components that can move the entire group. Also take the time to consider the impact of newly released data and events in other world markets on the US opening bell. (For related reading, see: Global Trade And The Currency Market .)

6. Who’s getting hurt in the current trading day?

Modern markets place big targets on different backs each day, with algorithms squeezing the life out of the latest news catalysts. These bullish and bearish themes tend to be diurnal affairs, with the focus shifting to new groups at the start of each session. (See Introduction: Bullish Vs Bearish .) That’s one reason we see so much rotation in a typical trading week. As a rule, look for affected instruments or sectors to find their footing after two down days or to roll over into profit-taking after two up days.

7. What’s your holding period?

Develop a trading plan that includes your holding period and stick to it unless market forces show a clear advantage in taking greater risk. This plan should carry greater weight than a single market day in most cases, so don’t let an adverse tape trigger an exit if the reasons you entered the trade are still valid.

8. How much size will you carry overnight?

Your trading plan should also address the total exposure you’re willing to take across all positions. If you’ve headed into the closing bell above this magic number, trim and cut as needed to follow your plan. Then consider if you can get a good night’s sleep with the risk you’re still holding. If not, keep on trimming.

9. Why are your positions ending the session at those specific prices?

Financial instruments rise and fall for many reasons. In most cases, simple noise is at work while prices grind through a continuous auction that seeks out pockets of supply and demand. The most favorable closing prices are those originating from active trends in your favor, or noise against you. It’s always a good idea to think about adding to exposure when noise generates a low-risk opportunity.

10. What needs to change to balance your current exposure?

Are you overloaded in big tech and missing great trades in healthcare or utilities? Are you so focused on the Euro/US Dollar cross that you’ve ignored healthy breakouts in a less popular forex venue? (See: Getting Started In Forex .) If so, the last hour is the perfect time to book a few profits and take the leap into trades that generate a more balanced portfolio.

In order to ensure that you’ve placed yourself in an optimal trading position — within the context of your own circumstances— to profit from worthwhile investments, while minimizing unnecessary exposure, it is important to assess the various decisions you made, and the approaches you took to various movements in the market, during the day. Will you continue to implement those same trading strategies the next day? If they are ensuring a more profitable, more secure investment position for you, you probably will. But if you note that certain trading moves you’re making are taking you in the wrong direction investment-wise, and are exposing you to unnecessary risk, it’s important to put a halt to these promptly, and make the necessary corrections to ensure a healthy portfolio that’s worth your while. Making a systematic assessment, using this checklist daily, will help to ensure you make such corrections as soon as you can.