Level 10
Risk literacy and plan discipline
By the end of this level you can think about risk in the language of probability, define where a scenario breaks down, and name the parts of a trading plan — this is a literacy lesson, not a strategy lesson.
In this level
- Thinking in probabilitiesLet us finally put the sentence repeated across nine levels at the centre: no analysis produces certainty. The strongest table of evidence — a completed pattern, volume…
- Invalidation and the concept of a stop-lossEvery scenario has a flip side: the place where it is FALSIFIED. This is called the invalidation level — when price reaches it, the evidence the scenario rested on no longer…
- Position size and the risk/reward conceptThe least discussed truth of risk literacy: what is at stake in a trade is determined not by the analysis but by the position size. The same scenario is a contained experiment…
- The trading plan and psychologyA trading plan is a written frame that moves decisions to when the market is closed — to a calm head — rather than while it is open. In educational terms it asks four questions…