First Rule of Trading: It's all about Survival!!

Hello Traders,

The First Rule of Trading:  It’s all about SURVIVAL!!


When I look over my trading I can see areas where I can definitely improve.  I also see my fears allowing me to do things I would not normally do with more capital.  It is a fine line between feast and famine I walk.

Most people would call me crazy … in fact … I have thought of it myself.

AM I CRAZY to day trade the futures market?  My wife is very supportive of my chosen career path, but am I doing my children a disservice?  It is not as if I have any talents outside of trading.  I have tried to sell myself in the open market, and all I get is you are over qualified to work with us.

How very strange?  On one end, I struggle to put food on the table each month, and the other hand I am too qualified to work with most of the companies I have sent in my resume.  So here we stand at an em-passe.

As you look at the picture above, you notice there are two people playing chess.  The one on the left is the devil, and the one on the right seems to be clearly beaten.  You can also see the Angel looking over at the man on the right.  But you will notice, even though, the man on the right seems beaten, he still has his King to move.  The game is not over!

As I look over my trading, what can I say to comfort myself … “it is always the darkest before the dawn” … comes to mind.  Today, I gave up 50 ticks to a market, where if I would have allowed the 3rd trade the proper stop loss I would have been ahead by 16 ticks on the trading day.

The second rule of trading comes to mind … the UGLY word FEAR … I will leave that for another blog post.

Survival should be your first trading rule, but you need to have ‘skin’ in the trading game to allow yourself an opportunity to profit.  I know personally my back is up against the wall.  March was a good month, but now we are in April.  I know in my heart I am only a few trades away from RUIN.  So the ugly FEAR component haunts my trading.

So here I am in between a rock and a hard place with nowhere really left to stand … I stand between SURVIVAL on one side … and FEAR on the other.

Do I have enough trading capital to withstand?  Do I have a valid trading strategy/method?

Will I be stronger at the end of April mentally, spiritually, physically, emotionally?  Will I SURVIVE the month of April?

Only time will tell … but what I have to do … is no matter what … trade my trading signals correctly!

I need to not allow my FEAR to override my SURVIVAL mentality and allow myself the best opportunity to stay in a profitable trade, while allowing myself to MAINTAIN SELF-CONTROL over myself.

It is a tough road I walk down … I make no reservations about it … it is the toughest road I have ever walked down in my life.

April 2nd, 2012:  Trading Statement 

Good Continued Trading,

David ‘Tiger’ Knight

P.S.  April 2nd 2012:  2000 Trades Chart

P.S.S.  Crude Oil Extreme Market Movement

Part I

 Part II


P.S.S.S.  TRUST MY TRADING SIGNALS AND STOPS!!  The WOULDA/SHOULDA/COULDA trading Day!  The 8P to 10P trade missed opportunity!!





About The Author

David M. Knight

I am a 30 Year Futures and Commodities Trading Veteran. In addition, I enjoy games of skill and chance like: poker, craps, blackjack and roulette. During my professional career, I have developed and implemented successful trading strategies and methods; along with winning systems in games of skill and chance. Join with me on our mutual journey together.