Invalidation

Invalidation is mechanical, not emotional. For an expansion thesis: significant overlap with prior territory, or the mechanical wrong point being reached. For a breakout thesis: price returning to the mid-range of the prior acceptance. Invalidation is defined before entry as part of forming the thesis. Once inside a trade, the defined invalidation condition is the only structurally honest reason to exit — not discomfort, not a certain dollar loss, not a feeling that the trade will not work. The practice of pre-defining invalidation and honoring it under pressure is one of the most valuable disciplines in the framework.