Trading High Volatility

Don't get whipped out of trades due to high volatility.


With volatility picking back up last week we need to make sure our trading plan has the proper rules so we can profit from this type of movement. You can't have the same trading plan for a low volatility market and a high volatility market. If you are trading with a tight stop loss you could easily be whipped out of trades due to the large spikes we see in either direction, this can even happen when we enter into trades that fit our rules and end up turning into winners once we get stopped out. So what can you do to?




#1 Drop size


If you are trading a few contracts on the E-Mini S&P 500 think about dropping down to one. Now I'm sure the first thing that will come to mind is "I'm going to make less money" , yes you are partially correct and we will touch on this down below on how to actually make this work in your favor. By dropping your size you are also dropping your risk, like we talked about above if you have a tighter stop with a larger amount of contracts then your ris