Right! Base it off the Hot reading

I set mine just like you are thinking but always always based on Hot reading

Hot is full engine temp like 5-10 minutes after a run Yea it ain't fun but then you know what it really is

FWIW after the first few times they all should settle down and you don't need to get in there but every so often just to check--I like to keep after them so I catch a lifter wheel or lobe getting into trouble before it gets to Code Red