You’ve seen markets like this before.

Maybe it was Black Monday in 1987…

Or the dot-com bust of 2000…

Or the Great Financial Crisis of 2008.

You remember the headlines, the fear, and neighbors quickly pulling their money out of the market, hoping to salvage what was left.

You didn’t panic then. Or, maybe you did. And maybe that’s why this time feels different… 

After a certain point in life, money stops being theoretical. It’s no longer just numbers on a screen. It’s time with your kids and grandkids. It’s the trip to Italy you promised your spouse. It’s freedom.

That’s why these days hit even harder. 

The market is choppy, ugly, and unforgiving. It sucks. You struggle with the temptation to do something. Anything. Sell before it gets worse. Switch strategies. Jump ship!

But here’s the truth that years of experience teach: this is the moment that separates the pros from the panickers.

Right now, staying means knowing how to play it smart.

For long-term investors, that often means sticking to your plan and resisting the urge to make decisions based on emotion.

For more active traders, it means shifting tactics: shortening timeframes, taking profits earlier, holding more cash, and watching closely for strength in unexpected places.

That market always offers a second chance. The key is making sure you’re still solvent when these fresh chances materialize.

Today, I’ll share a few ideas that can help you cope with the madness — and make money — even while the market is in flux.

Adjust Your Trading Time Frames

In a trending market, swing traders and position traders typically hold positions for a few weeks to a few months.

When the market is cooperating, you can allow your trades time to develop. That’s because the overall trend is higher. A mistimed entry or a wider stop loss isn’t the end of the world. A rising tide is more forgiving. Even a poorly executed trade can turn out profitable.

But in choppy and corrective conditions, you run the risk of getting “stuck” in the middle. When the market is trendless, breakouts are more likely to fail. Weak days often follow strong days. Generally, traders are more on edge and distrustful of moves, which leads to rounds of profit-taking as soon as a stock clears key levels or fills gaps.

In this type of market, a trading timeframe of several weeks will land you in the market’s dead zone. You might catch a strong move. But the stock is more likely to give it all back before you’re ready to take gains.

You can adjust to these conditions by cutting the middle out of your trading. Bucket your ideas into long-term and short-term. If you wish to pick up a stock to hold for the long haul, start small and begin building your position on down days.

But if you’re trading, you’ll want to stick to quick-hit plays. For these trades, you can attempt to play oversold bounces — or even individual breakouts. But you have to compress your time frame and sell much sooner than you would in more favorable market conditions.

Market swings will likely be more extreme in corrective environments, so you should have the opportunity to cram bigger gains into shorter time periods. The trick is to sell early — into strength — to avoid giving the profits back when the market inevitably turns.

Stay Selectively Active

When the market becomes volatile, our first instinct is to make moves.

That’s fine if you’re confident in your ability to quickly get in and out — sometimes in a matter of hours. But you don’t always have to be involved when conditions get dicey.

Cash is an important position when the bears begin to growl. You can’t put money to work if it's all tied up in losing trades.

Enrique and I discussed this on Top Trades earlier this week: Pare down your positions to increase your cash stockpile. This way, you’ll be ready to deploy capital when the rubber band becomes stretched.

I like to think of this as becoming selectively active in the markets.

You can grab quick-hit plays when you see the opportunities. And you can take gains and sit on your hands when trading conditions become too difficult.

Remember, you have the power to get in and get out of the market as you see fit. Use it wisely!

Make Your Lists — and Check Them Twice!

Even when markets suck, you can find a few winners amongst the ugly charts.

Take note of these stocks!

When the going gets tough, I’m always on the lookout for relative strength. I make lists of the stocks that are up big on green days, and down less than the average stock on days when the averages are falling.

I also keep tabs on stocks that are holding key levels: moving averages and other areas of potential support. Believe it or not, there are plenty of big, liquid stocks that are above their respective 200-day (or even 50-day) moving averages despite the recent poor performance of the Nasdaq and S&P 500.

These are your outperformers! They’re the stocks that could be the new market leaders once we emerge from this corrective cycle.

You can always attempt to pick these names up for quick trades. But a word of caution: When the market catches one of those big whooshes lower, these stocks will also drop. They’re not magically immune to drawdowns. But they will likely be the first names to catch higher and run as conditions improve.

If you already have a watch list of these relative winners ready to go, you’ll be one step ahead when the market finally turns.