The weekly regime checklist

Four readings, each with a few possible states, would produce a decision tree nobody would follow at 9 pm on a Sunday. So compress them into a single page with a single output: a size multiplier and a list of allowed setups. Fill it in every weekend before running a scan. If you skip it, you have skipped the most valuable ten minutes of the week.

The checklist

Copy this into a note, a spreadsheet, or the back of your journal.

WEEKLY REGIME CHECK          Week of: ________

1. TREND FILTER (index daily, 50/200 SMA)
   [ ] Uptrend      price > 50 > 200, both rising         score 2
   [ ] Correction   price > 200, below/around 50          score 1
   [ ] Early recov. 50 crossing up through 200            score 1
   [ ] Downtrend    price < 200, 50 falling               score 0

2. BREADTH (% of index above 50 MA)
   [ ] > 60%, or rising sharply from < 20%                score 2
   [ ] 40% to 60%                                         score 1
   [ ] 20% to 40%                                         score 0.5
   [ ] < 20% and still falling                            score 0

3. VOLATILITY (VIX or market equivalent)
   [ ] < 22                                               score 2
   [ ] 22 to 30                                           score 1
   [ ] > 30                                               score 0

4. ROTATION
   Top 4 sectors (1-month rel.): ____ ____ ____ ____
   Bottom 3 (avoid):              ____ ____ ____

TOTAL SCORE: ____ / 6

Turning the score into a decision

The multiplier applies to your standard risk per trade. If your plan says 1% risk, an amber week means 0.5% per new trade. Existing positions keep their original stops; the multiplier affects only new entries.

One override: if the trend filter scores 0 (downtrend), the week is red or cash regardless of the other readings. A downtrend with good breadth and a low VIX is still a downtrend.

Why a score and not judgment

You will be tempted to override the checklist because you "know" the market is about to turn. The record of most traders overriding a regime filter is poor, not because their read is always wrong but because the overrides cluster at exactly the moments they are most emotionally invested: after a losing streak, or after missing a rally. A number you computed from four objective readings is harder to argue with than a feeling, and that is its purpose.

Key idea: The checklist produces one number and one multiplier. Trade the multiplier. If you disagree with it, write the disagreement in the journal and trade the multiplier anyway.

Worked example

Suppose a weekend produces these readings: index above the 50 MA which is above the 200 MA, both rising (2); 47% of stocks above their 50 MA (1); VIX at 24 (1); top sectors are industrials, financials, energy and materials.

Total: 4. Regime: amber. Multiplier 0.5x. Allowed setups: pullbacks, reclaims, mean reversion. No breakouts this week, and only in those four sectors.

A trader running 1% standard risk on a $30,000 account would risk $150 per new trade this week instead of $300, and would delete every breakout candidate from the scan results before even looking at them.

When to sit out entirely

The cash regime is not a punishment. It is the single most profitable decision most swing traders make in a year, because it removes them from the weeks where every setup fails. Signs that it is a cash week even when the score is above zero:

• Three or more of your last five trades stopped out within two days of entry.
• The index has had three consecutive weeks of lower lows on rising volume.
• You have an open drawdown greater than your written monthly limit (Module 6).

Any of those, and the multiplier drops to zero for the week regardless of the score. Manage what is open, run no scans, and come back next weekend.

Keep the history

Save every weekly checklist. After six months you will have 26 rows of regime score against that week's realised R. Most traders find that the majority of their losses cluster in weeks that scored under 3. That table is the argument that will keep you following the checklist the next time you want to override it.

Try it: Fill in the checklist for this weekend. Then fill it in for the same week one year ago using the charts. Compare the two scores and write down what the multiplier would have done to your trading in each week.

Recap

• Score trend, breadth and volatility out of 6 and note the top and bottom sectors.
• 5 to 6 is green (full size), 3 to 4.5 amber (half size, no breakouts), 1 to 2.5 red (quarter size, reclaims only), under 1 is cash.
• A downtrend on the filter forces red or cash regardless of other readings.
• Recent stop-outs, persistent index weakness or an open drawdown breach override the score to cash.
• Keep every checklist; the history of score against realised R is what enforces the rule.