UKTraderGirl

I just re-read some of the previous posts. I want to make it clear i'm not suggesting someone go out and blow up lots of accounts until they make it- and do it fast. My post wasn't in agreement with that. The best things come to those with patience and perseverance. This is not the same as getting through a lot of accounts. It means learning to apply very strict money management so you don't have to blow up lots of times! Risking 2% of an account would take 50 losses in a row to blowup- if you manage to do that i suggest stopping trading and taking a serious look at your strategy- and doing the opposite of the signals it generates!

Not really. Nothing is quite like the real thing with trading. No matter how much you imagine it is like real money, when you actually trade with real money the psychology is quite different- and psychology is at least 50% if not more of what trading is about. Paper trading has its place for sure- and i would never recommend jumping in without trying it out first and using it to hone a strategy. You can vastly underestimate the effect that even a small drawdown can have on you. A 10% drawdown most of us feel is not much and we can easily deal with it- experience it for the first time in your live account after having 5 losing trades in a row (very possible with nearly every system) and it certainly effects you differently. Note i'm not saying, go throw thousands into the markets at random! Rather, placing a small amount into a trading account and considering it your 'training' fee is what i'm trying to get at.

How are you using it? I've never come across the ZigZag indicator. When i read it here i looked for it in my charting package- and there it was!

The trick is in coming to a turning point without having to go through the pain of a huge drawdown or loss of capital entirely. The fact that you are aware and know there are problems is a good start. Don't ignore it- figure out a way to do something about it instead. Drawdowns will happen, sometimes big ones, even if you are following a winning strategy perfectly- so you certainly don't want to increase the odds of this happening even more than they already are. The points you mention really do all boil down to discipline. You have to work really really hard at keeping your finger away from the mouse when it shouldn't be there! If you want to try out other strategies or ways of trading why not open a demo account and have a play around there instead? Stick notes all over your computer "I will only take trades following my exact strategy"- or other messages- do whatever it takes to ensure you stick to your rules. The above is especially important if you are going through a bit of a rough phase with your system. If you can't stick with it in good times, it's going to get even harder in times when it might not be performing quite so well. (incidentally, if the system stops performing so well scale down your trades until the market conditions adapt to suit the system better). "Come into my trading room" by Dr Alexander Elder is a good book which discusses trading psychology in some detail and may help you. Do you document all of your trades? Keep a spreadsheet as well as a diary. Perhaps print out charts of every trade you take, marking on the charts your entries and why you took that trade. "i took the trade because the moving average lines crossed and my system says to enter", or "i took this trade because the chart looked good". Doing this you can see exactly how much of a problem you have on your hands, become acutely aware of it and have a little bit of accountability to yourself for your actions. The problem with trading is that no one sees what we do-- we can have a sneaky trade here and there and no one will notice. Don't do it! Take every trade as though you need to explain yourself to everyone here. Umm.. i'm going on a bit now, i'll stop. Hope this has helped anyway.

Reading this thread i get a huge sense of deja-vu. Seen other threads almost identical to it on other forums... same problems re. lack of money management, etc. This system may very well work okay if give appropriate money management/risk management techniques to work alongside it. However, a stoploss of 20 and take profit of 5 (as mentioned on other forums) in my opinion is really not workable. Note: TRO doesn't specify these as a matter of course so i'll reserve judgement to the masses. Just wanted to say to be careful if you follow this and make sure you take appropriate measures to protect your capital should you have a string of losses. Note i'm not saying this is a very bad or wrong strategy- just wanted to put a word of caution.

There are so many ways to answer this question!!! When first starting with a real money account i would just for a short while trade the barest minimum possible- just while you get a feel for any differences that occur between demo and real money. -- You may want to risk say... for example 2% of your capital on any trade. There are several ways to do this... you can go down the route of trading a fixed number of contracts every time, and hence your stop is always the same distance away on all your trades. Or, you could work out the current volatility of the market (perhaps using average true range, ATR). Using this, you realise that greater volatility usually calls for greater stoploss distances to make a strategy effective. Less volatility allows for tighter stoplosses. Hence, on big volatility trades, risking 2% capital will mean buying fewer contracts, and on low volatility, purchasing more contracts. It may also mean that in these very volatile times you might not want to purchase any contracts at all. The above is just a rough idea of an area you might want to explore, and really only touches the tip of the iceberg on this topic. But, in my experience, it is very worthwhile using 'dynamic' stops/money management. It means you are more comfortable trading volatility, as it will only effect your account in a similar way to a non-volatile trade. Anyway, not sure that the above makes sense, just something to think about. Good luck.

I'm not sure that auto-trading accounts for even a slither of market action at the moment - though i could be wrong. Any automated system will need to be able to adapt to market changes. A system that worked this time last year in a nice trending upwards market will most certainly be failing in times such as those we are in now. If anything, trading against a computer might be more profitable. If all the computers start buying at the first sign of a breakout- you can just jump on board and enjoy the ride. The problem is, not all computers will trade the same, just as all humans will not trade the same. Everyone each has their own profit targets/goals/loss thresholds. So we are just back to the beginning again. So the market carries on. I don't think we have to worry about automated trading taking over for quite some time yet.