#planck
**Best Advice for Traders During a Crash: Don't Try to "Catch a Falling Knife"**
When the market crashes, emotions become your worst enemy. The golden rule is:
**"Don't rush to buy just because the price looks cheap. A falling market can keep falling."**
Instead of reacting emotionally, follow this plan:
1. **Stick to Your Pre-Defined Plan:** Your strategy should be set **before** the crash: What are your buy points? What is your maximum loss per trade (stop-loss)? Stick to this plan like a rulebook.
2. **Preserve Capital First:** The goal during a crash is not to "make a fortune" but to **protect your capital**. Survival is the top priority.
3. **Do NOT Average Down Recklessly:** Buying more of a falling asset to lower your average price is extremely dangerous during a crash. It can turn a small loss into a catastrophic one.
4. **Use Stop-Loss Orders:** These are your most important safety net. They automatically exit a losing trade before it drains your account.
5. **Step Back & Analyze:** Turn off the screens for a moment. Is this a short-term panic or a change in the long-term trend? Look at the bigger picture using charts and fundamental data.
6. **Keep Cash on Hand:** Having cash (liquidity) gives you the power to seize opportunities **after** the dust settles and the market shows signs of stabilization. The best bargains are often found not during the fall, but after it finds a bottom.
7. **Learn, Don't Blame:** Every crash is a lesson. Analyze what happened: Was your position too large? Was your risk management weak? Use this to build a stronger, more resilient strategy.
**Remember:** Crashes and corrections are **normal and inevitable** parts of the market cycle. The most successful traders are not those who predict every crash, but those who have a plan to **manage risk and control their emotions** when it happens. Discipline beats emotion every time.
