Rising Action: Paul discovers that he has a special ability. He can make his rocking horse come to life and it can take him anywhere he wants to go. Paul uses this ability to win a series of horse races and he becomes a wealthy young boy. However, his success comes at a price. He becomes more and more withdrawn from his family and friends and he starts to gamble compulsively.
Climax: Paul's gambling addiction eventually leads to his downfall. He loses all of his money and he is forced to sell his rocking horse. He is devastated and he tries to commit suicide.
Falling Action: Paul is rescued by his sister, Hester, and he begins to recover. He learns to accept himself for who he is and he starts to rebuild his life.
Resolution: The story ends with Paul happy and content. He has found a new home with his sister and her husband and he is no longer addicted to gambling.