Over the past few weeks we have seen volatility pick up casually and Then suddenly we are Hit with a huge 71 pt Range as prices sell off on the ES. The Dow Sells off 512 pt giving up 4.31% in one day. This is referred to as a Black Swan Event by Larry Conners.
How to react to events such as the one we are currently experiencing is the question at hand. Below is a list of ideas that i saw as solutions to preserving capital and and actually putting on profitable trades.
#1 Avoid Trading at all, Waiting it out Is Never a Bad Idea and is probably the very best thing traders can do to avoid unnecessary risk and exposure. If you feel you must trade us the demo account.
#2 DO NOT GET CAUGHT UP IN THE HYPE - Thinking Wow look at all these opportunities, i could just scalp the action. THIS mentality is sure to have you on the losing end of most trades and will decrease your odds causing you to over trade for sure.
#3 START THE DAY LATER- meaning avoid the open an look for midday opportunities when the range settles a bit.
