The Plan IS the Plan

Sean McLaughlin
January 31, 2023

It’s easy to follow a trading plan when the price action is moving our way. We feel like geniuses.

Look at me! I’m so smart! The stock market is doing exactly what I planned for it to do! Let’s go car shopping!

But how do I feel if the price action goes the other way?

Assuming I’ve put a trading plan together that accounts for both the possibility of being right AND the possibility of being wrong, why should I feel any different when the price goes the wrong way?

What’s the point of putting together a detailed trading plan if I later exit the position following the first price move in the opposite direction I hoped for?

Why go through all that effort?

If I’m one of those people who equates making money with “being right” and that feeling of being right is the real underlying drive behind why I engage with the market, then I need to own that.

We can debate for hours whether that is right or wrong (I lean strongly toward the wrong side).

If you find yourself in that camp, maybe a subtle mind-shift you might attempt to engage in is: “If my plan accounts for what to do both when price goes up AND price goes down, then whatever the market does, I’M RIGHT!”

Will that help you?

If we’re going to go through the effort of putting thoughtful plans together, or if you’re entering a trade based on a plan someone else put together for you – make sure you’re exiting the trade for the same reasons!

Otherwise, we’re just spinning our wheels in the mud.

Trade 'em Well,

Sean McLaughlin
Chief Options Strategist
All Star Charts, Technical Analysis Research

Filed Under: