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ILLkI8ILI1 IS CUk kL 1C SUkVIVAL
Pavlng a plan for whaL we Lhlnk Lhe markeL may do can be an lmporLanL Lool for a
Lrader Lo succeed 8uL human emoLlons can aL Llmes geL ln Lhe way and make us
hold onLo an ldea by sLopplng us from seelng devlaLlons ln Lhe markeL whlch
change Lhe prospecLs of Lhe plan SomeLlmes lL's purely LhaL ln Lhe momenL of Lhe
Lrade lL's dlfflculL Lo work ouL wheLher changes have occurred ln Lhe markeL or lL's
[usL Lhe LheaLre of Lhe Lradlng day playlng ouL ln lLs someLlmes confuslng and
dlsorlenLaLlng manner
l have seen and heard of many a Lrader who has a good run Lhen ls wlped ouL
Why? 8ecause Lhey flnd someLhlng whlch seems Lo work for Lhem really well buL
when LhaL ends Lhey aren'L flexlble enough Lo change Lhe plan or aL leasL have an
alLernaLlve Lo Lurn Lo My bellef ls LhaL we should always be flexlble ln our Lradlng
Lo glve ourselves Lhe besL chance Lo survlve and prosper
Pere are some slmple yeL lmporLanL ldeas Lo help you malnLaln your flexlblllLy
O on'L Lrade when you haven'L prepared Lhoroughly lf you haven'L
prepared and you don'L know whaL Lo expecL you are less llkely Lo be able
Lo adapL your vlew of Lhe markeL qulckly and approprlaLely
O on'L Lrade when you are Llred or emoLlonal 1hls ls probably my blggesL
source for belng sLubborn ln my Lradlng lL ls a Lrlgger for a less aware and
more emoLlonal sLaLe whlch ls ofLen bllndlng of reallLy
O 8e aware of Lhe blg plcLure as well as Lhe small Pavlng an adapLable plan ls
ofLen abouL looklng beyond [usL whaL and how you Lrade undersLandlng
Lhe markeL from dlfferenL Lypes of parLlclpanLs' perspecLlves can glve you a
varleLy of ldeas Lo sLudy
O 9lan for alLernaLlves so LhaL lf you see devlaLlon you sLlll have solld
reasonlng for whaL Lhe markeL may do eclde LhaL Lhe markeL has shown a
dlfferenL agenda and Lrade lL wlLhouL a careful plan and you may be asklng
for Lrouble
O 1ry Lo have a 'break clause' for your plan know Lhe elemenLs of Lhe markeL
whlch are Lelllng you lLs sLory undersLand where Lhese elemenLs may
appear Lo help conflrm your plan and Lhlngs whlch may persuade you Lo
swlLch Lo a dlfferenL plan WaLch Lhe markeL for Lhese Lells Lhrough your
Lradlng Llmeframe and you'll see Lhe ploL unfold before you
O on'L be behlnd Lhe curve lf you are chaslng an enLry or an exlL you are far
less llkely Lo be able Lo see whaL ls golng on 1he real cosL of mlsslng an
enLry ls ofLen noL abouL mlssed proflLs buL how lL changes your emoLlonal
balance
O MonlLor your sLraLegy over Llme lf you don'L you'll be less aware of
mlsLakes and how much Lhey cosL you ?ou'll also be less aware of changlng
markeL condlLlons 1raders who don'L fully observe Lhelr sLraLegy's
performance ofLen complaln abouL Lhe markeL belng poor raLher Lhan
looklng Lo see lf Lhere's a beLLer way Lo Lrade Lhe currenL condlLlons

Pere ls a slmple example from 1hursday 13
Lh
CcLober 2011 CulLe near Lhe Lop of
lLs recenL brackeL Lhe Lmlnl S9 300 clearly sold off lnLo Lhe 413pm LS1 close
Cne of my scenarlos was a posslble selloff 1he plan was lf l could geL a LesL of Lhe
prlor day's laLe selloff and gauge sLrengLh l mlghL go shorL Lo poslLlon myself for a
furLher move down Weakness on open and l'd be walLlng for a move back up of
some sorL Lo see wheLher or noL Lhe selllng could perslsL So whaL happened was
Lhere was selllng early on buL noL Lo Lhe same exLenL as l had LhoughL 1hls was
Lhe flrsL slgn Lo me LhaL a blgger selloff wasn'L abouL Lo happen 1he nexL slgn was
when prlce had goL lnLo Lhe Monday/1uesday range prlce acLlon was suggesLlng
buylng All Lhls was happenlng whlle Lhe Lrend was sLlll down 1he 3 mln charL Lo
Lhe rlghL was where l swlLched my vlew and sLarLed looklng for long enLry polnLs
for a LesL back lnLo 1hursday's range



1he markeL does whaL lL does regardless of whaL you expecL CeL lL rlghL and you
mlghL proflL geL lL wrong and you wlll lose So whenever you Lrade you have Lo
Lhlnk ln probablllLles noL Lhe probablllLy of whaL Lhe markeL may do buL Lhe
probablllLy of your [udgmenL of Lhe markeL belng correcL 1ake each and every
acLlon of Lhe markeL as plece of lnformaLlon When you lose on a Lrade lf you
have LhoughL lL ouL well and you have a sound sLraLegy LhaL lnformaLlon ls
golden lL's probably cosL you a loL Loo so make sure you use lL well! When you
sLarL dolng Lhls you'll see LhaL Lhere are many dlfferenL ways a markeL can
behave and you'll be much beLLer poslLloned Lo proflL even when slLuaLlons arlse
whlch you felL were less llkely Lo occur

1rade well