Over the long run, market conditions change. The system that works in the past may not be relevant in the new market condition. You must review and fine tune the system when market conditions change.
One of the most popular strategies to make profit from falling stocks is short selling the depreciating stocks. If the market is trending down, look for opportunity to short and do not long it. When the market is trending up, look for opportunity to long and do not short it. You only have to look at some of the intraday fluctuation in some stock prices which is normally catalyzed by market rumors. As a trader, you need to protect your trading capital and abide to the rules of your trading system for entries and exits. With a good understanding, you can design and use a system to capitalize on market movement. You will be able to apply the correct tactic to beat the market. The trader must win in the market not to prove that he is right, but to seek profits.
In trading, it is true that you need to know yourself. It includes understanding your psychology and how you behave or react to profits and losses. Most untrained investors get into the market without any careful calculation and often end up not knowing how to exit when the market moved. When it comes to assessing a trade, you must have a pre-determined set of rules or system to help you evaluate (measure) a potential trade. Like what Warren Buffett says, “risk is not knowing what you are doing.” If you do not understand the market, you are not fit to invest in it. You will get your capital (army) wiped out.
Take care and all the best!
Happy trading