Setup Grading (A+ / A / B)
Rating trade setups by quality — A+ setups get full risk, B setups get reduced risk
Setup grading is the process of rating each trade setup on a quality scale (A+, A, B) before entering. The grade determines how much risk you allocate. A+ setups have clear higher-timeframe alignment (4H zone is fresh and obvious), full mid-timeframe confirmation (15m shift confirmed), clean lower-timeframe structure (1m chain with 3+ links), and excellent R:R (5:1+). These get your maximum risk allocation (typically 1%). A setups have one minor imperfection — the zone has been tested once, or the R:R is good but not exceptional (3:1 to 5:1). These get standard risk (0.75%). B setups have positive expectancy but multiple imperfections — the 15m isn't fully confirmed, the 1m structure is messy, or R:R is acceptable but not great (2:1 to 3:1). These get reduced risk (0.5%). Below B, you don't trade. Grading must be done BEFORE entry, based on setup characteristics — not after, based on outcome. A winning trade that was a B setup is still a B setup. The grading system is built from your backtesting dataset, not from theory.
✓How to Recognize
- •A+ = all boxes checked: fresh 4H zone, confirmed 15m, clean 1m chain (3+ links), 5:1+ R:R → 1% risk
- •A = one imperfection: zone tested once, or R:R is 3-5:1, or 1m needs an extra link → 0.75% risk
- •B = multiple imperfections but still positive expectancy: messy structure, 2-3:1 R:R → 0.5% risk
- •Below B = no trade. The grading floor protects you from low-quality entries.
⚡How to Avoid
- →Grading based on outcome instead of setup quality (winners aren't automatically A+)
- →Having too many grading criteria (4-6 conditions maximum, keep it simple)
- →Skipping B setups entirely (they still contribute to P&L at reduced risk)
- →Upgrading a B to an A because you "feel good about it" (grade from checklist, not emotion)