edabreu

4 years. 1 year of losing while you search for the holy grail. 1 year of loseing while you come to the realization that there is no holy grail and what you have is good enough if only you would stick to it and stop changing things every couple of weeks. 1 year learning to read a price chart properly. 1 year to learn a few strategies that you devised from reading the price chart. The money comes in the 5th year. If not, then you should go do something else.

In trading, there will always be a profit and a loss per transaction. When going from sim trading to cash trading the market will seem like a new reality no matter how well you did with sim trading your strategies. Your presence in the market does count. Your actions in the market will create a consequence. The forces you will be dealing with in the real cash market will act upon you, and you will affect the outcome of your trading in a very direct way. So, while you are following along in sim be aware that there will be at least a 10% loss of everything when you go to cash trading until you have made the mental and emotional adjustment. In other words, you will have to adapt to the real cash market beyond the technical. So, the higher and more sustained positive performance level you achieve in sim will go a long way towards helping you while you are making the adjustment. One to the primary approaches for many new traders is to attend a moderated trade room and follow the moderator's trades. The reasoning for this approach is to make some cash while trying to learn how to trade. I will call these the type C traders. It is not a bad approach. It tends to cost a lot more in terms of money and frustration than the other types. It tends to lead the trader into a limbo state where there is never a clear goal oriented path with a clear time line and defined educational foundation. These type tend to flounder a lot. Following a moderator is not as easy a task as you think. Also, learning another s trading method while trying to earn money at the same time can lead to focused confusion. Should I take this trade in real cash or sim? Which setup is this, and did this strategy work last time? This approach creates more questions than it answers. Also, this type of trader is more susceptible to becoming a cash cow for the trade room owners. This type more easily falls prey to the idea that one strategy or method is superior to another. They are more likely to embark on the holy grail search. Other traders really don't focus so much on learning, or approach learning as a vague by product. These traders just want some reliable trade room moderator or lead trader to give them profitable trades on a steady basis. They come into the trade room 30 minutes after the open or 25 minutes before the close. They want the first trade to be the winner, and they want it to be easy and fast. They expect the lead trader to be responsible for their results and blame the lead trader when they are unable to make a dime following them, while the moderator seem to make his/her daily goal consistently. Let's call these traders the type B trader. When the lead trader goes through a draw down period, most of this type of trader leaves to find some other moderated trade room. Following a lead trader is not as easy as it sounds. It is tough to trust your money to someone else. It is even tougher to leave your thinking to someone else, at least it is for me. This pattern of behavior is, to me, the losers pattern. There is a third type of trader among the many types of traders. This third type of trader I will call type A, or the potentially great trader. This type approaches trading as an activity to be learned and studied. They are usually self reliant, are not looking to make money immediately or for the short term. They have an aversion to being spoon fed, and would rather learn to fish for themselves. The potentially great trader is willing to go through a structured learning program that may take them months to complete. This type of trader is more likely to discover, in a relatively inexpensive fashion, much of what the other trader types never learn until they have blown out a few accounts and spent a couple of years in a continual state of frustration. This type of trader will wait until they have met some kind of qualifying standards. They will probably spend a lot of time testing the strategies they learn with a defined performance goal in mind. They will most likely enter the market with a lot of confidence and belief in their strategies that is based on firm statistical performance levels. They will most likely have developed very good trading habits and good technical and money management decision making habits before they ever risk real cash. This type of trade will probably spend most of their time in the real cash market working on self control and not strategies, not indecision about when to get in or out, not on wondering if they should let a trade run, or take a scalp. In other words, they will know themselves as traders a lot more precisely than the the other types. This type of trader will have a better understanding of the role that statistical probability plays in the outcome of each trade, and will have a better understanding of themselves and their capability of trader. They will more likely have arrived at trading goals based on what they are able to do consistently rather than what they want. This type of trader is more likely to associate with other similar type traders in a private atmosphere. This type may also from time to time use mentors or structured educational courses to help them along in their studies. More often than not, these are the survivors. They took their time, did the work, made and survived their mistakes, learned from the mistakes of others, and grew into a consistent trading pattern of behavior that leads to sustained profitability. This type takes the longest to cultivate. For you B types I offer this idea. I hear there is a sure fire trade room guaranteed to make you money over on relay 1. You can subscribe for only $300 a month forever. They trade from 9 to 3 everyday, all day. You can just pop over during lunch and make a few hundred every day! Don't quit. Keep trying. I need you to keep trying. Please keep trying. For the C types I offer these ideas. Suppose you decided to not make money trading for at least 1 year. Take this year to open a chart and stare at it for at least 3 hours a day, 5 days a week. The first month just watch it, and take notes of what you see happening. Describe the events. You can put a few indicators on the chart, but nothing predictive. Just put on some lines describing yesterdays hi, low, open and close. Keep it simple. Just use the session chart. Spend the first month watching what happens at these areas. The second month you can start to mark on your chart the defined events you have observed. Only the define the familiar reoccurring events, not the anomalies. Describe these events with just a word or two. During this second month, observe the reaction of price at these defined events. Define the outcome of these events. What did price do? If you have trouble recognizing repeated patterns, you can add one or two predictive indicators. Keep it simple. Add a moving average, and maybe add some kind of non price based oscillator. Now describe things in relation to these tools. Or, you can add just a trend line and some kind of line to indicate dynamic events that are created by price during the last x bars. If you are using candles, then take note of the most significant candle patterns at the static areas of yesterdays hi, low, close, and today's open, current hi, lo. Do not get too sophisticated. The third month, do something when you recognize the reoccurring event, and see what happens. Record the outcome of your actions. Do this for the next 3 months. By the 6Th month, you should have some statistical records of all this activity. You may want to use another chart with a larger point of view, and while you are reading about how the market is structured you may discover things like volume distribution and accumulation, and theories about market psychology, and mass hysteria and panic. Do not let yourself be too influenced by these concepts. For this first year your goal is just see what you can see, and do what you can do, and decide if there is any value to it. Over the course of the next 6 months, see how many times your actions at reoccurring familiarly defined events produced a positive outcome. So, yes this is a lot of work. There is no immediate reward to this, and there is no guarantee that all these months of activity will produce any kind of positive outcome at the end of one year. So, if you cannot see yourself doing this, then re-read about the trader types. Decide which one you want to be, and take steps to cultivate yourself. If you do not know what steps to take, seek out other A types and see if they can offer you some guidance. The most important elements to look for in another A type trader is consistency of actions, historical records of past actions, and their ability to convey ideas understandably. If they are willing to let you watch them trade, great! Not all of these types make good coaches or teachers. More often than not, you will have to bug them for their experience. Most A type traders were once C or B types who just got fed up with losing and decided to do whatever they needed to become winners.

There are many ways to learn something. You could read a book, take a structured course, watch and imitate, trail and error, and others if you care to spend some time thinking about it. When it comes to learning, repetition combined with application leading to a structured qualifier (test) often is the best way to actually know that you have learned the material. With trading there is a tremendous mental aspect to your daily activity that cannot really be taught without the accumulation of active live experience performing the trading activity. This means after you have studied your strategy and the related technical considerations for taking your trade entry and exits, the additional thought processes that combine with this are your personality, desires, expectations, hope, fears and the entire spectrum of your emotional makeup. This will now increase your learning experience to push it from the theoretical and technical into the realm of a defined personal reality. It can be pretty scary at first. Most traders do not get past this level, and are unable to combine their measurable technical proficiency with their controlled emotional responses and are thus doomed to travel the eternal roller coaster or travel on the path in search of the holy answer. One big reason why they cannot get past this level is because the ending result of the learning combination produces negative results from their trading. This may be the result of a low probability strategy combined with too low of a risk reward strategy or entries that are ill timed, or a combination of all these. Add the additional emotional processes to this and you have a great recipe for disaster. If we go backwards and examine each part separately, the strategies with defined trade entries and exits, and the trade and self management while trading we will probably see an incongruity. Having a clear trading plan that covers our entire spectrum of activity while trading can go a great way to help us pinpoint the problems. The main question is what does it mean to learn and just how do you really learn to trade well enough to be able to confidently continue in the face of flying bullets on the battlefield? First and foremost remembering that trading is a probabilities game and that your personal input into the market is inconsequential to anyone except the unknown trader on the other side of your trade, helps put things into perspective. So the first thing that comes to mind is that worrying about whether your strategy based trade entry will work this time is pointless and a futile waste of energy. If your strategy is based on soundly tested statistical result backwards and forwards, and your entries and exits have the proper risk reward with the probable expected outcome of your strategy then wondering if this trade will fall into the 70% win side or the 30% loss side is ridiculous. Yet I have seen many a trader go into each trade expecting it to fail. Even more curious is I have seen traders go into a trade and due to not following their accepted (pre-defined) risk according to plan turn a winner into a loser because they wanted to limit the failure to less of a cost. Then they watch it come to within 2 ticks of their original stop and go on its merry very profitable way while they stand there holding their 8 tick loss when their stop was originally 10 ticks...but since this was sure to be the loser, they are left holding the empty bag. One big reason for this recurring behavior is that they lacked a sure reason that could tell them the trade had failed. With all the price gyrations and without a clear price based exit criteria, they may have stayed in the trade only as long as their nerves held out, rather than for some technical reason. There have been times when I have entered a trade and price performed a clear exit pattern, and I was able to confidently exit my trade with a 2 or 4 tick loss avoiding the full stop. There have been other times when the price action and pattern was muddled and unclear and so I stayed in the trade since no exit criteria was met and took the full stop out. When using my automated strategies, there was no consideration on the exit on my part. I had to rely on the expected outcome dictated by the automated strategy. All this is according to plan. When we decide to learn to trade, we have a few choices as to how to actually go about doing that. None is better than the other and we will learn according to what we are able to understand and accept. For some people the trial and error method sits better with them. Maybe they have deep pockets or big egos, or strong independent streaks, or just cannot trust anyone or have all the time in the world. For others a clearly defined educational course is required. To get from a to b x amount of things must be mastered. Measuring mastery is sometimes a tough thing. If you take this approach make sure you have some qualifier. Others need a defined structured trading course combined with hands on guidance, a final qualifier and someone to hold them to task along the way. Still others need all of the above and in a safe environment with milestones measured by statistical achievement, continual constructive input and analysis from a third party guide, some pushing and prodding, and someone who they can always bounce their learning experience off of in real time. Unfortunately getting all you need to be able to actually learn to trade consistently first, then confidently, then finally successfully is really tough in this business. Most of us want to hear what we want, not what we need. Many of us think if we pay enough then that means it will work. Many think you can just buy it and so the best is the one that costs the most. Many of us think that it should all be for free and all traders are obligated to help each other win. Think about that. If I am to win, then who will need to take the other side of my trade when I do? I am reminded of my family. The family will always tell you what you need to hear about yourself, while everyone else will usually tell you what you want to hear or don't want to hear, not what you need to hear. Family can really be a pain in the butt, but you gotta love them because they will be the best mirror you will find. Learning to trade means first deciding what you want to learn, then how you are best able to learn that. If you tell someone you want to learn how to make $1000 a day, then be prepared to start at $100 a day (or less!). One of the things I try to emphasize is to learn to do well what you can do now first. If you have a strategy in mind, then learn how to make that strategy work until you get to the point where it either does or does not work. Keep tweaking it until you are able to work it to consistency and profitability. This can take time and money. In the end it may never work for you. If you are starting from total scratch, have no great ideas or any real confidence that you can develop a profitable strategy within a reasonable amount of time, then look for some predefined strategy that makes the most sense to you and that you can understand. But more importantly, keep in mind that most reasonably reliable strategies of 50% (or even less) with the proper risk-reward and trade management can work and does work for the person who designed it and knows how to properly trade it. Good teachers will teach you their method and help you learn your own. The best teachers will first plant their voice in your head, and then show you how to turn that voice into your own. Good teachers are like mirrors. They were just like you. When I taught martial arts, everyone started as a white belt. Only a few made it to black, and even fewer to the higher levels of black belt. Learning to trade for many comes down to learning how to trade like someone else until you can learn to trade like you. The first part is actually the hardest. Once you learn it, you are left with nothing to do but improve on it and become a better trader.

There are a lot of chart pics and videos about system performance results floating around all over many vendor websites. Many of the reported replay results are phenomenal. It seems every video you see is a winner. For some magical reason the sensitivity setting was just perfect for that day, the money management was perfect for that day, and the results were just perfect for that day and it was the same instrument. The most amazing thing, however, is that on each day the settings for system sensitivity were different. The range chart bar or time size was different. The target and stops were different. Gee...how did the system know which sensitivity to use for each day, and how did it know to adjust the targets, and how did it know to change the range bar size? Intriguing questions. Simple honest answer is that the system did not make these decisions, the user (vendor) did. So, how did the user know? Simple honest answer is the user did not know. But Market Replay is a wonderful thing. With it you already know what kind of day is was, so all you need to do is adjust the sensitivity, adjust the targets, adjust the range bar chart size and viola! you have another perfect day. Do not be so naive and gullible to believe that a system that has $1500 to $2000 winning days trading a 2 lot is a consistently real thing. It is a hindsight result, with a lot of adjusting gone into the settings to make it work perfectly. Also, did you get the part about the $500 intra day draw down? Remember you are trading a 2 lot. Do you think such a draw down is a realistic amount for the number of contracts you are trading? since that draw down is way over 2% of any reasonable 2 contract trading account. Ask yourself that if at 11am you are up $300, and then at 1:30 you are down $500, would you still be able to continue? Would you trust the market to give it all back to you, and get you back into profit when all you have to go by is hindsight results? So, unless you are a hindsight trader, market replay results are almost completely useless. What you need to know you will never know. You can not know in advance what kind of day it will be. You can guess. Or, you can have a stable consistent sensitivity setting, use a consistent range bar chart size, use a consistent risk reward plan, and then run the system day in and day out and see how it performs. Look for real time results posted in real time, the same day before any replay was possible. Or better yet, look for long term consistent results with the same instrument, same sensitivity settings, same range chart size, same risk reward plan. Then you can gauge the realistic potential, the realistic intra day draw down, and the realistic performance over time, in real time.

Absolutely correct. Blunt and to the point.

High Probability Trading Consists of long hours of keen observation of the market. Keep it simple, keep it clean, gain experience and confidence over time. You start by watching the chart. Take notes. Name repeated patterns. Get familiar with them. When you can see them quickly and know their names then start trading them. Range charts are unique. Very few traders use them. Very few traders make money. Very few traders focus on price, the tape, volume. Small consistent wins make you money. Once in a while you get a big winner. Whoopee. Trade the trend, fade the trend, trade a sideways range, scalp it. Whatever fits you and makes you comfortable is what is right for you. Find a strategy you can trade or create one of your own. Read, read, study, study, practice, practice. Concentrate on your strategy and when you are ready (after thorough testing) stop looking for anything else, stop buying stuff, stop attending seminars, stop reading forum threads, stop all interference and distractions and start to trade. Trade for money. Trade as a businessman. Trade for yourself. Consistency is more important than anything. It all starts with becoming consistent. You can fix consistent (wrong) actions. It is almost impossible to fix erratic behavior. Eventually, you will have to fly on your own, or crash and burn. Trading is not for everyone. If you find out that it is not for you, that is great. It is no reflection on you or your life. It is not personal, you did not fail. It is OK to just stop. You may not be wired for this. So, find something else you are good at and/or pursue other avenues of investment.

This is an amazing and very rewarding profession. Once you have your trading routine, and just trade according to plan, tediousness can set in. However, if you can find yourself a trading buddy or friends to trade together, then it helps a lot. Also, get away from the screen. Either trade to a goal or trade a set time period, and get out and spend some of the money. Two things come out of that - you will want to trade to make more, and you will feel really good about helping out your family and friends.

Read some of the ideas and methods here...but be sure to not try them all. Be selective. See if one or two or even three pop out at you. Spend time with those that you understand pretty easily without too much figuring out. Try those, and then see if you can refine something from them and devise something that YOU CAN WORK. That is a key idea....you have to be able to work the method, regardless of whether the method works for someone else. Welcome to trading. Trust your own ideas.

Absolutely. Make sure to re-read that part about ideas that you can get your brain around. No sense learning rocket science if you want to make money trading.

I approach my trading day like a job ( a very nice easy job since I can trade or chose not to trade). I just come in and make the donuts and be done. I spend the rest of my day helping my trading buddies, and just enjoying the day.

Started with a wake up 2am stop out , but got it right. Almost got smacked. I think I will make some coffee, maybe put some trousers on and not trade in my pajamas... Mr autoentry-bot got me into a couple of good ones, and I got shaken out of the 100 tick long...sigh...

Traded the TF - Russell this afternoon. Had to wait until it hit the brick wall so I could get some reliable signals.

No, keep them coming. Those damned auto bots are trying to take over the market and put us discretionary traders out of business. If it wasn't for us discretionary traders, those auto bots would not have even been invented. As a matter of fact, they couldn't trade spit without us to hold their hands...

Good day considering all my a.m. computer problems and watching the CL tank without me....at least I earn a living. I have to give some credit to my autobot....thanks.

Ha ha ha ha ... you better get that thing checked. Could be a lose screw!

The overnight was pretty good. Letting my robot do the trading for me while I sleep.

Within this forum is something called "the Acid Test" In order to pass that test many of your trading actions are going to have to be correct. Sim can not duplicate the emotional content of cash trading, but if you shift your focus to performance based, then you can get a good idea of how you are doing technically, and money management wise, whether your method matches your personality, and quite a few important issues that can be dealt with without risking your real cash. Keeping a detailed journal for the test is extremely important also. The ability to control yourself while trading is impossible if you do not recognize yourself while trading. If you cannot pass the test...well then you need to find out why. So, keep that journal as precise and comprehensive as possible. It may be the best way to understand that person who is actually doing the trading.

Organizing yourself is easier with a plan. This plan will probably change a lot over time, but it is a good start. Make a learning plan. Define a reading list. Define a task list. Such as learn about various types of price charts. Learn about various types of tool sets. Learn about various types of approaches..ie - price based, indicator based, auto systems, mechanical systems, rule based discretionary systems. Learn about various methods and read about how successful traders have used them. Keep the focus realistic. That is a large hedge fund manager's method and approach to the market while very interesting, may not do as much for you as some of the methods and approaches you find described in this forum. So, keep the big picture in mind (its very attractive) but focus on steady progress towards hands on trading. Making a list or chart as to the things you think you want to learn is a good idea. Just go down the list. Many times traders turn to structured trading education institutions because they are looking to shorten the learning curve, looking for someone to tell them what to do, or just looking for a safe easy way. There is no shortcut. There is no easy way. There is the cheap, slow, methodical way that can lead to real sustained success....but the key word is time. How much time are you willing to devote to this? Here is an interesting fact. Once you have gone through a learning period and have garnished a fundamental understanding, then start trading sim, and then limited cash. However, as you start to trade, spend less time jumping around the library from shelf to shelf, and more time focusing on developing your own style through careful observation and detailed note taking about what you are doing and the results you are getting. Simple is best.

A few swing trades dragged down my PnL... Otherwise a good month. Too many trades. My goal this year is to get my average trade up to $38, and reduce the number of trades. So far I am realizing that my percentage may have to slip a bit in order to keep the bigger trade. We'll see.

Smoking day today... caught a tiny bit of it.

Pretty good day. Started with a wake up call...

A little bit of Dax, little bit of Crude, and some TF

All I need is 2c, a little volume, some extended runs if you have them...and I am good.

Caught some good moves today.

missed the monster move up and down on the report...but managed to get the left overs.