I'm sitting here at my Lake Tahoe lakefront mansion watching the Dow Average open down 700 points from its Friday intraday high.

It is one of those perfect, picture postcard days, with a blue sky and cobalt lake. The fields outside are covered with snow crystals sparkling in the sunshine.

After the close, I'm going to have to shovel off my outside decks to keep the weight of the ice from collapsing them.

Those (SPY) April $182 puts are looking pretty good this morning, up 50%. They're hedging all of my remaining long side positions.

In these heart stopping trading conditions it is more important for me to teach you how to avoid doing the wrong thing than pursuing the right thing.

I am therefore going to reiterate my 13 Rules for Trading in 2016. Tape them to the top of your computer monitor, commit them to memory, and maintain iron discipline.

They will save your wealth, if not your health. Here they are:

1) Dump all hubris, pretentions, and stubbornness. It will only cost you money.

2) The market is always right, even if all the prices appear wrong.

3) Only buy the puke outs and sell the euphoria. Do anything in the middle, and you will get whipsawed.

4) Outright calls and puts are offering a far better risk/reward right now than vertical bull and bear call and put spreads, which have a built in short volatility element. It is also better to buy stocks and ETF's outright with a tight stop loss. This won't last forever.

5) If you do trade spreads, you can no longer run them into expiration. If you have a nice profit take it, don't hang on to the last 30 basis points, even if it means paying more commission. The world could end three times, and then recover three times, before the monthly expiration date rolls around.

6) Tighten up your stop loss limits. Not losing money is the key to winning in this market. There is nothing worse than having to dig yourself out of a hole. Don't run hemorrhaging losses, like the (TBT) from $57.56 down to $37. It will get easy again some day.