First of all I just want to introduce myself. This is my first post but I’ve been following this forum and baby pips for about 5 months now. I’ve been demo trading quite successfully for about 4 months now and have a sound system and trading strategy. I opened a demo account (mini) and started trading this week on Monday… ummm I really got my A$$ handed to me in my first 5 trades… why you ask ?..well I did almost everything your not supposed to do… why you ask I did this… psychology.
So my question is, while demoing I did amazing like most do, I freaked out during my first day and recovered from it and identified why my trades went south on me. I’m OK now, but what do some of you experienced veteran traders do to keep the emotional aspect under control, whats the process you guys/gals run through ? Any advice would be much appreciated.
I wish this could be easily answered but is the key task to undertake once you go live. Mark Douglas’ trading in the zone’ and books by Brett Steenbarger are worth reading to give you some ideas about the psychological aspects of trading
Ya I know you’ve recommended the book many times, i was planning on picking it up this weekend. Just wondering if you or others have a certain process or mentality that get them ready for trading ? Or are all of you just steely eyed killers LOL
Its a good question. I go through a series of simple mental and physical processes to promote relaxation and have a number of sayings on my trading desk such as ‘follow only the rules’ to remind me of the key issues. The most important thing I do though is review every trade in the light of my rules. I never forget early on in my live trading going 0-9. When I reviewed the trades with the rules the score ‘should’ have been 4-5. Although not flash it was quite clear that the problems existed with me not the model
Hi,
When you trade demo, then you know in your subconscious mind that it’s demo and you will, under no circumstances lose money. But when you go live, your conscious mind comes into alert mode and even the smallest drawdowns can trigger fear in you.
So, live rading is really different from demo.
a few advices:
- always shave off your beard before you start trading. It’s Important.
- Don't look for market tips. Create your own system. Only the creator knows how to practically apply his system. Systems and signal sellers available in the market will only confuse you.
- If you can't create a system, apply only and only fibonacci. Knowing 3 different systems will not make you an expert but mastering just one system will definetly make you a successful trader. Fibonacci series is strong enough to make you a multi millionaire.
- Never use stop loss. Use ' doubleup stake ' at definite intervals.
-don't ever jump to commodities or stocks to make more profits. Keep your portfolio limited to currencies and only a few.
- have clear monthly profit targets, 10%/20% and then decide on your strategies.
- Exit point should be the reinvestment opportunity.
always shave off your beard before you start trading. It’s Important. I love this quote, I knew I was doing
something wrong.
Or are all of you just steely eyed killers
Also love this one as well. :lmao:
The idea really is to get a system which works for you &
stick to it. You must trust your system implicitely, know it
inside out & back to front.
Also in time one does become hardened to the wins & losses.
Basically in the end you do not care whether you lose,
because you know that your system works & your wins will
out pace your losses.
I hope that doesn’t sound too pretentious, it isn’t meant to,
but it is the only way I could think to sum up the emotional
feelings of trading.
This feeling does not just happen over night though, it is akin
to learning how to trade. When traders write things like, " I just slap
on a stoch, have a quick look at the charts & bingo, another 1000 pips" it really makes
me laugh, because they have missed out all the times, maybe years,
when this did not happen.
They over simplify the whole concept of trading, which basically
gives new traders the wrong impression.
Do your research, backtesting of various systems, get to know the
different mechanisms, there are no short cuts.
An investing strategy in which a trader doubles his or her current position in an asset when an adverse price movement occurs. By doubling the risk, the trader hopes to earn a larger return when the security moves in a favorable direction.
When executing a double-up strategy, the investor believes that the latest adverse price fluctuation is only temporary and will shortly correct itself. To capitalize on the price reversal, the investor amplifies his or her current position. Doubling up is a risky strategy, but it can yield large returns.
I think that when we backtest and demo a system we focus on how well (or poorly) the system works.
I think we should also be consciously be focusing on ourselves…getting comfortable with how the system works…become one with the system. It becomes a matter of trust. Can I trust this system? Yes, the demoing and backtesting showed me that we can work together.
I wonder if that may even be a hurdle for those traders purchasing a system. Since they have the claims and testimonials, they might not backtest and demo it. They know it works … but they have not trained themselves to trust the system.
I appreciate everyones responses, I guess it take a lot more trades to get down to the point where I trade like the Terminator. I knew demo trading was going to be a lot different from live, but I didn’t think it would be that different. Anyways anymore tips or ideas would be appreciated (ie in terms of making the demo to live switch). And as far as the beard goes I’m going down to store and throwing my crappy disposable away and getting a Mach3 or Gillette Fusion or something, I must do this right:D
Keeping your lot size so small that a loss is irrelevant will help you. The psychological impact will be minimal and it allows you to check that your model works with your chosen execution provider
i strongly agree with trusting your system…
i will give an example;
for the past 5 weeks i have been trading with a sytem i developed with what i learnt from this forum (thanks to DDreamer, Tess, Jocelyn and Tonymand) and my pips have been very very grwwn :D:D
last friday, i saw an entry, and went in, i didn’t put a s/l because i was baby-sittng the trade, and boom!!!..
my internet connection went off!
don’t worry, it was only a demo, but if you know how passionate i am with demo trading, you will think its my money.
this morning, i checked the price board, and price has already hit my TP.
i was 80% certain price will go my way b’cos it has happened like that these past weeks. and i am now used to the system.
this is a good encouragement especially since i plan to go live soon.
anyway, i think there are things for me to learn from this experience but i am saying it here to let you guys know that ur system has to be original and you must trust the sygnal u see befor entring a trade.
and…please use S/L, its important, things could have gone the other way for me.
Have you or anyone of you read the book “trading in the zone” by Mark Douglas? I heard it’s a good book… It’s about psychological realities of trading…
I love this quote, I knew I was doing