Core rules for every playbook

The four Ratigan Capital rules

These are Josh's operating rules. The names are his modern adaptations of themes from Jesse Livermore's 1940 book How to Trade in Stocks; they're not Livermore quotations. Module 6 covers the background.

Patience as a Position. No trade is a valid position. Wait for the completed signal the playbook defines; watching price near a level is not a signal. Lesson
Never Average Down. Never add to a losing position to improve the average price. Never widen a stop. One planned entry per setup. Lesson
Early Is Wrong. Entering before confirmation is a rule break, even when it makes money. A profitable violation still counts as a violation. Lesson
Price Is the Only Truth. Act on completed price evidence and your written stop, not on opinion, conviction or a story about who moved the market. Costs, news windows and liquidity still apply. Lesson

Before any entry, write the playbook name, the frozen levels, the confirmation time, the planned entry, stop, target and size, and record pass or fail for each of the four rules, separately from profit.

Mindset: accepting risk before entry

These are Ratigan Capital adaptations of ideas taught in Module 5, which draws on Mark Douglas's books. Douglas didn't create or endorse any of these playbooks.

Define invalidation first. Before entry, answer: "Where does this trade stop being valid?" That price is the stop. If you can't name it, there's no trade.
Stops execute on the trigger, not on a close. Entries wait for a completed candle; exits don't. When price trades at the stop, exit at the first executable price. Your planned loss is 1R; your filled loss can be larger because of gaps and slippage. Record both.
Accept the full risk before you enter. If the planned loss feels unacceptable, skip before entry, not after.
Judge the process across a batch, not one trade. Any single result is mostly noise. See Consistency as a process.

The four fears that break plans, and their counters (full lesson):

Fear	Typical behavior	Counter-rule
Being wrong	Cancelling the stop because the level "should hold"	A stop is the cost of finding out, not a verdict on your skill.
Losing money	Skipping a valid signal after recent losses	Risk is fixed before the signal. Take every valid signal or none.
Missing out	Entering before confirmation	Early is wrong. A missed trade costs nothing.
Leaving money on the table	Moving the target or holding past the time stop	One target, one time stop. No improvised runners.

A casino knows its edge from the rules of the game. We don't know ours. No edge has been established for any playbook here.

Shared risk protocol (untested parameters)

Every value below is an untested modeling parameter for research. It's not a recommendation for your account. Try your own numbers in the risk calculator.

Item	Rule
Risk budget B	0.25% of equity E per trade
Loss per unit L	\|entry − stop\| + estimated exit costs (fees, spread, slippage)
Net reward per unit G	\|target − entry\| − estimated costs
Reward/risk gate	Skip unless G / L ≥ 2
Quantity	Smallest of B / L, 25% of E ÷ price, and available cash ÷ price, rounded down to the venue's lot size
Exposure	One position at a time; notional ≤ 25% of E
Daily stop	Pause for the day after realized loss of 0.5% of E or two losses; pause for review at 2% drawdown
Stale signal	Cancel if the next open is more than 0.1% away from the signal close
Same-bar ambiguity	If stop and target are both inside one bar, assume the stop filled first
Product	Long, unlevered spot only. Short branches are excluded.

Execution realities

Fees and spread are charged on both entry and exit. On small targets they can consume most of the reward, which is why costs are inside L and G.
Slippage and gaps: a stop is a trigger, not a guaranteed price. Fast markets and gaps fill worse. See Stops, slippage, and gaps.
Shorting: on a spot exchange you can only sell what you own. Shorting needs margin, borrowing or derivatives, which add funding costs, liquidation risk and leverage. That's why short branches are excluded here.
Sessions: crypto spot venues trade around the clock, every day, so these playbooks use the UTC calendar day as a fixed label. That's our convention, not an official session. US stocks have regular hours of 9:30 AM–4:00 PM Eastern on trading days (see NYSE hours), with overnight gaps and session-based VWAP; applying these ideas there needs separate testing. Venues also have maintenance windows and outages; check yours.
No live data on this site: examples use made-up prices.

Shared no-trade filters

These apply to every playbook in addition to its own filters, and they aren't loosened to get more trades.

Spread wider than 0.10% of price.
Order size more than 0.1% of the average volume of the last 20 bars.
Stale, missing or changed data feed; fewer than 250 bars of warm-up history.
Within 30 minutes before or after a scheduled US CPI release or FOMC statement (and exit open positions 30 minutes before). Use the official BLS and Federal Reserve calendars.
Daily stop already hit, or a position already open.

How these get tested

The plan, before any result is published: one venue and pair fixed in advance; data split 60% development, 20% validation and 20% final test, with gaps between; all trials recorded, including rejected variants; realistic fills and costs. No results exist yet. When they do, they'll follow the research standard, losses included, and a playbook may be retired.

Sources

Education only, not financial advice. This is a personal record of one trader’s decisions, including the mistakes. Trading crypto carries a real risk of losing money. Full disclaimer.