Jason Alan Jankovsky – Catch a Falling Knife

One of the oldest (and most outdated) trading maxims is: “Don’t Try to Catch a Falling Knife” The idea is that when a market is dropping hard and fast it is better to wait before attempting to buy it; the metaphor conjures images of a very messy outcome doing a lot of needless damage to a trader physically-if not to his equity. In my experience-the reason most analysts and educators suggest to YOU the developing trader “don’t try to catch a falling knife” is simply because they personally don’t know how to do it.