Do I need a reality check? | Forex Factory

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Do I need a reality check?

  • #1
  • First Post: Sep 4, 2006 11:54am Sep 4, 2006 11:54am
OK. For two and a half weeks now I have been feverishly studying and learning all I can about day trading and forex. I've read a couple books, I've read a few threads here. I've practiced on a demo account for two full weeks, the first week losing $20,000 - admittedly having no clue of what to do, the second week gaining $6000. I've laid out a trading plan, which appears with as much historical research that I can do, that is pretty reliable and is mainly the source of the $6000 success (trading $10,000 at a time).

At this point, I feel I know nowhere near the extent of what a lot of you guys on here do. However, I also feel that I have a darn good grip on the basics of how this works. I also feel that my trading plan is pretty solid - not perfect, but probably pretty darn good for a new trader. I feel I have a good grip on money management, also - I've never been one to risk much money (percentage-wise) on anything.

I honestly feel, that after a week or two more of trading my plan, that I could go live with real $$$. Is this a bit pretentious of me? I've always gotten the feeling that I accelerate faster than others with new information, so I guess what I'm asking, before I go out and blow my wad, is if any of you others out there started up a live account after 1 month and have been continually and progressively successful since then?
  • #2
  • Sep 4, 2006 12:04pm Sep 4, 2006 12:04pm
Quoting mwfromva
OK. For two and a half weeks now I have been feverishly studying and learning all I can about day trading and forex. I've read a couple books, I've read a few threads here. I've practiced on a demo account for two full weeks, the first week losing $20,000 - admittedly having no clue of what to do, the second week gaining $6000. I've laid out a trading plan, which appears with as much historical research that I can do, that is pretty reliable and is mainly the source of the $6000 success (trading $10,000 at a time).

At this point, I feel I know nowhere near the extent of what a lot of you guys on here do. However, I also feel that I have a darn good grip on the basics of how this works. I also feel that my trading plan is pretty solid - not perfect, but probably pretty darn good for a new trader. I feel I have a good grip on money management, also - I've never been one to risk much money (percentage-wise) on anything.

I honestly feel, that after a week or two more of trading my plan, that I could go live with real $$$. Is this a bit pretentious of me? I've always gotten the feeling that I accelerate faster than others with new information, so I guess what I'm asking, before I go out and blow my wad, is if any of you others out there started up a live account after 1 month and have been continually and progressively successful since then?
I could be wrong but I feel compelled to say...


Yes. You do need a reality check.

Patience. Stay with the Demo or at most, a Live Micro for a while yet.
  • #3
  • Sep 4, 2006 12:07pm Sep 4, 2006 12:07pm
Greetings and welcome to the Factory. This is probably the best place to be and ask your Q's.

As for your Q. Different Strokes for Different Folks. Most here have demo traded for some time. I know pros that still have demo accounts to tweak a new idea and such. FWIW, i'd recommend reading everything you can on trading Psych here at the factory. Read all you can find writen by a memeber called "fiji". Another good place to learn is over at the James16group, there is a private side, and here is the public side, fiji is one of the founders. Good stuff. This is in the end is not much more than a mind game between you and the market. Systems, Indicators, and "Sources" come and go...But our mind and psych will always be either our best friend or worst enemy.

IF you insist on rushing into live trading, many here will recommend you begin by using a b r o k e r that you can trade 10 cent lots, or what is called a micro, or supermini account. There are many that offer such. The one i use is FXsolutions and it also has the advantage of utilizing trades in both directions at the same time on same currency.

Cheers,
Thom
  • #4
  • Sep 4, 2006 12:08pm Sep 4, 2006 12:08pm
Why blow your wad. Start out with a mini account of $300 to $500 ... and see how you hold up. If you're as sharp as you think you might be at trading - then you should be at (or above) a $10K balance within a few months. Then you can start making the real money. If you were planning to go with a larger funded account... you might want to reconsider. Just look at it as - "I haven't earned the right to trade big funds yet... since I'm still green." Anyways, I think you might be surprised at how different trading feels when there is real money involved... yes, even a small amount like $300.
  • #5
  • Sep 4, 2006 12:20pm Sep 4, 2006 12:20pm
i would suggest doing the demo for a entire month and study just one currency pair.
My suggestion would be Eur/JPY that is my favorite at least.
But i like long trends.

Also when you do go live make sure to start with a Micro account and only trade in 1,000 dollar blocks
that way each pip is $.10 each.
Learn your support/resistance levels on your chosen pair.
Buy if it holds support, sell when it nears resistance.
  • #6
  • Sep 4, 2006 1:45pm Sep 4, 2006 1:45pm
get a live micro. i think oanda and interbankfx do $0.01 per pip. real money acts different, i have no idea why, i think they set the demo level to easy

if you win / break even on micro you willl be learning. if you loose it will teach respect for the demo. some times it's like poker, if nothing is bet then it isnt working.
  • #7
  • Sep 4, 2006 1:55pm Sep 4, 2006 1:55pm
Whien I began trading currencies, I went straight into a live trading account, but, I had successfully traded equities, futures, and options. Currencies are their own animal, if you have no background in trading any other vehicle, you do need a reality check.

Would you drive on the DC beltway with only a trip out of your driveway as your only experience?

fwiw...
  • #8
  • Sep 4, 2006 2:03pm Sep 4, 2006 2:03pm
Yep agree with all, open a $300 - $500 Demo account, real money even if only peanuts is alot harder than a Demo account, well is for me, maybe you won't suffer.

Limit the amount you add each month aswell ( $200 say ) and while the account is unservicable trade Demo again ( I hope you ofcourse don't need these rules.

Personally, I say forget putting in big money, protect your capital and just grow your $500 account, by upping the Lots when you get good and as the account will take it. ( be my plan anyways )

( personally, Demo I rock, can't lose, real started £300 UK, I've added £500 since, but getting it back at the moment, down £200 over all, hard game )

My Spread costs, work out at over £1000
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #9
  • Sep 4, 2006 2:16pm Sep 4, 2006 2:16pm
If something is working for several weeks... go at it with small dollar amounts. Dont let people scare you away from giving real money tests and trials a go. That is the only way to feel good about yourself. It will also test your true diligence and commitment to the trading at hand.
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #10
  • Sep 4, 2006 2:35pm Sep 4, 2006 2:35pm
Just seen to many traders ( with stocks ) plow in with 100K+ as they think they need big $$$'s to make it work, then lose a chunk then get gambly to get it back, once that happens it's all gone pretty quickly.



But each to there own, someone has to lose so someone else can gain, shame it's rarely retail traders that gain though.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #11
  • Sep 4, 2006 6:57pm Sep 4, 2006 6:57pm
At this point, do you guys think the private James thread would be a good idea?
  • #12
  • Sep 4, 2006 7:06pm Sep 4, 2006 7:06pm
Yes, One of the best there is.
Warning, lack of trading is dangerous to your survival......
  • #13
  • Sep 4, 2006 8:34pm Sep 4, 2006 8:34pm
As someone who recently started using real coin.

For me trading with real money is different. For example you know when you say you lost 20k then you made 6K, next month you could lose another 10k,
and you will know the reason why AFTERWARDS. I'm not trying to be negative it's just that psychologically it appears there is a difference using money and not, plus you are always realising stuff, that you didn't even think you needed to know.

I am glad I started trading really small. As an example one of my stops got triggered, and I found out that I had not allowed for the spread in my calculations. This little newbie things can cost you money. So make it cost you as little as possible. Definitely go with the cash, when you are ready but don't move up to the big coin until you have completed your education at that level.
  • #14
  • Sep 4, 2006 8:39pm Sep 4, 2006 8:39pm
Trading in the Zone.

Read it. Then come back.

You'll thank me later.
Mr. Trend
  • #15
  • Sep 4, 2006 9:11pm Sep 4, 2006 9:11pm
I just finished reading this book for the 3rd time this weekend.. It is a must read no doubt.



Quoting Mr Trend
Trading in the Zone.

Read it. Then come back.

You'll thank me later.
  • #16
  • Sep 5, 2006 12:05am Sep 5, 2006 12:05am
Quoting smjones
I just finished reading this book for the 3rd time this weekend.. It is a must read no doubt.
Isn't amazing how you can read a book a few times and pick something up each time that you hadn't before? Reminds me of the Bible.
Mr. Trend
  • #17
  • Sep 5, 2006 1:32am Sep 5, 2006 1:32am
Quoting Bemac
I could be wrong but I feel compelled to say...


Yes. You do need a reality check.

Patience. Stay with the Demo or at most, a Live Micro for a while yet.
I had to read no further than this answer. This your answer and it good advice. Demo only good to learn the Platform you trade on. Real money becomes a different "Reality".
Here come my Poker talk again! I played poker on a demo for about 6 months. I know Poker, believe, I know, but, I not know how on-line work. Many people playing on the Demo are loose and easy, because they know they get more money when they go broke. Easy to pick up Fantasy Money! But, when I funded a Real Money account the game was different. I started playing the 4-8 cent table. Yea, small money and not win much! But, it helped me to get my mind back in the game as I not get to play for real much. I slowly moved up in time to the bigger tables. Now, with this said, if you feel you ready! This what you do. First, I DO NOT endorse a Broker, that every person's opinion. Oanda you can start with a small amount. OK, you think you ready? Then drop $100 into Oanda Live and see!!!! IF, you can not build up $100 because greed wipe you out you not ready. People think they need big Leverage and Money to win, NOT TRUE. What Oanda do is make you learn patients!!!! When you only get 10 cents a pip and have to build on that...............then you know if you ready for 100-200:1 leverage. But, this my opinion. :
  • #18
  • Sep 5, 2006 4:40pm Sep 5, 2006 4:40pm
I have been reading "Financial Freeom through Electronic Day Trading" by Van K. Tharp and Brian June.

Would these two books be similar or is there something phenomenally different about the Mark Douglas book?
  • #19
  • Sep 5, 2006 4:45pm Sep 5, 2006 4:45pm
Trading In The Zone is not about FOREX. It is about learning a mind set that will bring about success in trading and in life.

Quoting mwfromva
I have been reading "Financial Freeom through Electronic Day Trading" by Van K. Tharp and Brian June.

Would these two books be similar or is there something phenomenally different about the Mark Douglas book?
  • #20
  • Sep 5, 2006 5:01pm Sep 5, 2006 5:01pm
Quoting smjones
Trading In The Zone is not about FOREX. It is about learning a mind set that will bring about success in trading and in life.
The book I'm reading isn't about forex - it actually starts off with psychology. It actually says after the psychology part of the book, that if you were still reading, you must be serious about trading because most people would have tossed the book by that point.
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