Trading Plan - Today's market drop reinforces why your trading plan is important $SPX $SPY $DJIA

• Your trading plan should tell you what to do not only when the market is rising, but also when it drops
• Remember that the market always goes down faster than it goes up
• Your reaction to the market should be automatic
• If you find yourself paralyzed not knowing what to do your trading is not working
• If you find yourself thinking too much about your next move then you need a new trading plan
• Here is an example of a trading plan rule:
•  Identify support and resistance levels.  Exit 50% of your positions if the market falls 1% below your 1st major support level.  Exit the remaining 50% if it falls 1% below your 2nd support level.
• If you followed the above rules you would exit 1/2 of your positions at $201 and 1/2 at $198.
• You should also have rules to tell you when to enter the market which could be the opposite of the above or whatever rules that work for you.
• The above is just an example. Your trading plan and rules should fit your investment style and personality.
• Happy Trading!