I used to jump into trades based on what I'd seen on social media or what looked like a good opportunity in the moment. Someone would mention a ticker, I'd see some excitement around it, and I'd buy a call or put without doing much homework. Sometimes it worked. Most of the time, it didn't.

The problem wasn't that I didn't know how options worked. The problem was that I was trading blind. I wasn't checking the one thing that could have saved me from most of those losses: the chart.

Looking at a chart might sound basic, and honestly, it is. But it's also the difference between making informed decisions and throwing money at hope. Let me walk you through the three things I check every single time before I enter a trade.

1. Which Way Is the Stock Actually Moving?

This sounds obvious, but you'd be surprised how often people ignore it. If you're buying a call because you think a stock is going up, you should confirm that it's actually in an uptrend. If the stock has been falling for weeks and you're hoping it bounces, that's not a trade. That's a guess.

I look at the recent price action over the past few days and weeks. Is the stock making higher highs and higher lows? That's an uptrend. Lower highs and lower lows? That's a downtrend. If I'm buying calls, I want to see an uptrend. If I'm buying puts, I want to see a downtrend. Going against the current trend can work, but it requires more skill and usually more risk than I'm willing to take on most trades.

2. Where Are Support and Resistance?

Support is where a stock tends to stop falling and bounce back up. Resistance is where it tends to stop rising and pull back down. These levels matter because they often dictate where price will stall or reverse.

Before entering a trade, I mark these levels on my chart. If I'm buying calls and the stock is sitting right at a major resistance level, I know the trade might struggle. If it just bounced off strong support, that's a better setup. You don't need to be a technical analysis expert to spot these. Just zoom out on the chart and look for places where price repeatedly bounced or stalled. Those are your levels.

3. What's Happening Right Now?

I also check the most recent price action. Is the stock moving cleanly, or is it chopping around in a tight range? Choppy price action usually means there's no clear direction, and trades in that environment get whipsawed.

If I see a stock trending smoothly with momentum behind it, that's a signal. If I see it bouncing up and down without making progress in either direction, I wait. Patience often saves more money than any strategy.

The Chart Tells the Story

When I started doing this consistently, my trades improved. Not because I became a chart expert, but because I stopped making avoidable mistakes. I stopped buying calls on stocks that were clearly trending down. I stopped entering trades at resistance when I should have waited for a breakout.

The chart won't guarantee a winning trade, but it will tell you if a trade even makes sense in the first place. And that simple filter can save you more losses than you'd think.

Take the extra five minutes. Check the trend. Mark your levels. Make sure there's actual movement worth trading. Your account will thank you.