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I’ve been trading for a long time, and I still make mistakes. Today, I’m sharing a bear market trading lesson I learned the hard way.

A few weeks ago, my trading results were lackluster. I was correctly analyzing the charts and technicals, but I just could not execute on trades and book wins. This, despite the fact that my approach for most of 2022 has been from the bearish side.

I kept asking myself, “How could I be on the right side of the market and not be making solid trades and winning at least some of the time?”

My inability to get in sync with the market trend was starting to drive me nuts.

I took a step back and soon realized that I was using the wrong trading style. I was combining a bullish trading style with a bear market playbook.

In a bull market, you can stay with trades longer. If you make an error or lose on a trade, the bull market will almost always offer you a chance at redemption. Just stay with the trade longer, and if you’re interpreting the charts correctly, everything will work out right in the end.

The opposite is true in a bear market. The markets seesaw up and down quickly, and you have to tread carefully. Both bulls and bears get hurt, sometimes badly.

So, I adjusted my timeframe for trades and my risk management approach. I started take profits sooner and sizing my trades smaller than usual. Those small tweaks worked out perfectly. We had a tremendous month here at Explosive Options. Our portfolio was up 12% in September, while the SPX 500 was down 10%.

Here’s my advice to you: be more proactive in a bear market. Book smaller but more wins. Book profits when you have them. Keep a tight leash on losses; once it’s clear a trade is not working, cut it loose. Your results should improve.

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