vecchp 

I'm pretty sure that replay data from ninjatrader is tick by tick data of a previous session. While it probably doesn't emulate slippage I should be getting a similar experience. I suppose calling it simulation was the wrong term.

Accurate data is not the problem in my opinion.

The problem is how people trade. When you trade on sim, you make decisions that you would never make on cash. So trading sim is for the most part worthless, after the initial break-in period of getting used to your platform and your setup.

Mike

sysot1t 

if you want to learn PA, why not just do PA from FX (not futures) with a live account ($20-100) trading $1 or less.. if you can be consistent with that, then you can make it with the rest.. I mean, PA is PA after all.. and trading in sim is, well... trading in sim.. anyhow, good luck.

I disagree with you here. The PA is a bit different on different instruments and FOREX runs a bit different. Just my experiences. There are nuances to each instrument and market in my opinion that one has to 'hone'.

bluemele 

I disagree with you here. The PA is a bit different on different instruments and FOREX runs a bit different. Just my experiences. There are nuances to each instrument and market in my opinion that one has to 'hone'.

price action is price action, the same principles apply... nuances are merely individual characteristics of any given instrument which would imply PA is specific to a instrument, when that is not the case... PA is PA... honing to a given instrument is merely specializing, not an indication of the PA skill but an application of the PA skill to that specialization..

would you agree?

While I agree that live experience can't be beat, I feel that there is something to be learned with replay simulations. Jumping in with both feet can allow one to develop bad habits without noticing them until you've gone broke.

In my early stages of learning, I feel that it is important I take advantage of all resources available. For example, with my current plan, I am capable of doing a simulation session and then immediately compare with that of Al Brooks or another successful price action trader such as Cadaver. This is extremely beneficial the session is fresh in my head. If i do it live, I have to wait at least a couple hours to a day for their analysis.

I also like to compare my trading endeavor with my online poker days. My first attempt I just jumped in with 50 dollar deposit thinking, "hey, nothing is like the real thing!" Within a month that money went to 0. I attribute that loss to focusing on winning money rather than making the correct play. A player that makes the correct plays will generally be a profitable player. However, that does not mean he will win every hand. So instead of focusing only on the play, I worried about losing money.

I started over and this time I began in the play money rooms. Until I was capable of beating that madness consistently, I would not deposit another dime. I focused solely on the move, not caring about my money but only whether or not the play was correct. I have to say that this is where I learned very important lessons in my game.

After consistently beating that level, I eventually moved on to low stakes taking the knowledge I gained with play money. While the first few hands felt different in a live game, I kept repeating to myself that I need to focus on the play rather than the dollar signs. Eventually I was able to detach myself from the dollar sign and again focused on making the correct play, regardless of whether or not I won the hand. Over time I became consistently profitable and slowly moved up the ranks.

The only time I consistently lost money was when I deviated from my game plan, like moving up a level before I had enough statistics to justify doing so.

So I consider session replays to be very like the play money situation. This is important to building my fundamental knowledge of price action. I have to focus on making the correct play in the market at the time. If I cannot do this correctly on a consistent basis in simulation how do I have any chance of doing it live?

I also view this period as a lesson in patience and self-control. If I am not patient enough to trade simulation until I unlock my initial achievements, how can I say I will be patient enough to sit and wait for correct trades while live? No matter what my feelings are, until the numbers say I'm ready I have to wait. If I can't do that I know I am going to jump into trades that I shouldn't in live, I will let my emotions run the show instead of the trading plan and method I have laid out.

I really think a trader must start with discipline in mine. I already set a goal and I believe that altering it because "I think" I'd get a better experience going straight to live is just fooling myself. I believe this will lead to many other situations where I let myself bend the rules just because of gut feelings; leading to unprofitable trades.


I appreciate everyone’s response so far and look forward to your continuing interest in my journey.

vecchp 

While I agree that live experience can't be beat, I feel that there is something to be learned with replay simulations. Jumping in with both feet can allow one to develop bad habits without noticing them until you've gone broke..

you missunderstand what we are arguing... trading actual cash (even $100 that you can replenish) forces you to trade with proper risk management (remember, you can replace the account unless you wire $$$ and costs you $$$)... nothing to do with going broke while doing so, hence the whole point of learning PA with FX... or even with equities... only issue is that equities requires $25K min, while Futures $5K min (AMP lets you open an account with $500!) .. and of all FX is the best... you can trade $1 on a $100 account with oanda.. sure, you wont make millions while learning, but you wont go broke either...

sim is sim, cash is cash... two different mind sets.. there is no reset button for one.. that is our argument..

I think there are mainly two issues between sim/cash.

Physical and Psychological.

I believe you are both RIGHT, but who cares, we are all right.

1. If trading real cash, there are issues with having a large enough account or other physical limitations that would alter the way you trade.

2. There is a psychological issue when trading live as well whereby you can't accept being 'wrong' or whatever when real money is on the line.

Some people can accept #2 and move on. However, #1 can't be overcome and many systems don't allow or set up proper expectations for failure. The biggest issue is trading on too much margin.

Like I mentioned, you are just describing the different side of the coin. Same coin.

So after my big response about sim vs real trading, I thought about it some more. As long as I keep my losses and money at risk very small then I will get more real experience by trading in a live account.

So I opened up a Forex account at MBTrading. My first day I lost a few points on trades which would have been very profitable but for some reason the MT4 software would immediately close me out of the trade once it was placed.

Day 1
-75.5

I don't have a picture of the trade setups since I got frustrated that MT4 kept closing my position immediately after execution causing a loss. I set my stop losses very far from my entry so i'm not sure what was causing the problem. This happened for 3 orders so I just closed the program and decided to try again the next day. However, 2 of the trades would have been good if they stayed executed.

Day 2
I came back from work and saw a possible M2s entry. Since MBtrading gives you a better commission for limit orders. I set a limit order at 1.35589, stop loss @ 1.35733, and take profit at 1.35589 (close to the low of the forming channel)

Trade was good so +102 pips
Total Profit: 26.5 pips

[Edit] The initial prices i input were wrong for the Day 2 entry. Here are the correct values

Entry: 1.35691
S/L: 1.35733
T/P: 1.35589
Close: 1.35582

Pips: 109
[/Edit]

vecchp 

So after my big response about sim vs real trading, I thought about it some more. As long as I keep my losses and money at risk very small then I will get more real experience by trading in a live account. So I opened up a Forex account at MBTrading. My first day I lost a few points on trades which would have been very profitable but for some reason the MT4 software would immediately close me out of the trade once it was placed. Day 1 -75.5 I don't have a picture of the trade setups since I got frustrated that MT4 kept closing my position immediately after execution causing a loss. I set my stop losses very far from my entry so i'm not sure what was causing the problem. This happened for a 4 orders so I just closed the program and decided to try again the next day. However, 3 of the trades would have been good if they stayed executed. Day 2 I came back from work and saw a possible M2s entry. Since MBtrading gives you a better commission for limit orders. I set a limit order at 1.35589, stop loss @ 1.35733, and take profit at 1.35589 (close to the low of the forming channel) Trade was good so +102 pips Total Profit: 26.5 pips Attachment 50600 Attachment 50601

I'm a little confused...your limit and take profit are the same ?...typo

kbit 

I'm a little confused...your limit and take profit are the same ?...typo

Oh! Yes that is a typo and I'm reading the MT4 order summary incorrectly. I didn't know that your T/P could be different than the actually price you get.

So

Entry: 1.35691
S/L: 1.35733
T/P: 1.35589
Close: 1.35582

Pips: 109

vecchp 

So after my big response about sim vs real trading, I thought about it some more. As long as I keep my losses and money at risk very small then I will get more real experience by trading in a live account. So I opened up a Forex account at MBTrading. My first day I lost a few points on trades which would have been very profitable but for some reason the MT4 software would immediately close me out of the trade once it was placed. Day 1 -75.5 I don't have a picture of the trade setups since I got frustrated that MT4 kept closing my position immediately after execution causing a loss. I set my stop losses very far from my entry so i'm not sure what was causing the problem. This happened for 3 orders so I just closed the program and decided to try again the next day. However, 2 of the trades would have been good if they stayed executed. Day 2 I came back from work and saw a possible M2s entry. Since MBtrading gives you a better commission for limit orders. I set a limit order at 1.35589, stop loss @ 1.35733, and take profit at 1.35589 (close to the low of the forming channel) Trade was good so +102 pips Total Profit: 26.5 pips [Edit] The initial prices i input were wrong for the Day 2 entry. Here are the correct values Entry: 1.35691 S/L: 1.35733 T/P: 1.35589 Close: 1.35582 Pips: 109 [/Edit] Attachment 50600 Attachment 50601

that is very good... glad to see you practice with real cash... ... now, keep in mind that your rules for trading a tiny account should be no different than trading a large accont... by that I mean, if you risk only 1% of the account per trade and you have a $500 account, then you should not risk to lose for a stop anything greater than 1% per trade... if you can adhere 100% to your trading plan wtih $500, you can do it with $500,000... that is my opinion...

as an FYI... OANDA also is now supporting MT4... I downloaded it the other day and setup a subaccount just for it to play around.. it is not bad and it works well over cell wireless... their spreads are better than MBT... only issue is some of the orders behave a bit strange... I will trade live with it next week and see how it behaves.. I spent this week on learning the new interface on MT4 and tracking down the indicators i use...

I personally like OANDA because I can also use their iPAD based application to keep and eye and trade positions. Comes in handy when I am @ the office.. and I can even use my iphone as well...