Page 452 - THE MARKET WHISPERER

448 PART 13 - How To Get Ready For Your First Day Of Trading

can shoot incredibly during a real time game? Very few!” Here too, it’s the
same basket, the same player, and the same game… but the outcome in
competition is very different. There’s a well-known story about a dueling
champion who was invited to a pistol duel. Beforehand, he warned his foe
that he was able to hit the stem of a champagne glass from a distance of ten
strides. The foe, more experienced with real battles, answered, “Let’s see
if you can hit the stem of the champagne glass when the glass is aiming a
loaded pistol at you…”

One vital component is absent in demo trading: emotion. When you
play with real money, a loaded pistol is being aimed at your brain. Basic
weaknesses such as fear and greed make it much harder for you to remain
cool and rational. You simply will not be the same person in real time as
you were in demo time, and even though right now you are certain I’m
wrong, you will quickly discover how profits on the demo easily turn into
losses in real time trading with real money.

Don’t be mistaken: I’m not saying you shouldn’t use the demo. If you
keep its disadvantages in mind, you will benefit well from its advantages. A
trader profiting “on paper” during the study period will always remember
that in an environment without pressures, it is easy to beat the market.
If and when that trader loses money in real time trading, he or she will
smartly seek the differences between demo training time and real money
trading, analyze them, internalize them, and correct what needs correcting.
Sometimes the new trader may even stop trading in real money and go back
to the demo for a very short period, to better understand the differences
now that some real experience has been gained. Demo trading trains the
trader to execute technical actions quickly, and more importantly, teaches
that it is possible to make money if you maintain the rules and do not
involve emotion.

Avoid internalizing bad habits when you practice with the demo. Use the
demo to improve your reaction speed, practice trade orders, and learn the
trading program inside out. Even when using the demo program, trade in
small quantities and small numbers of trades, as though you were dealing
in real money. Analyze each trade well, as though it was executed with real
money. Stay tuned to experienced traders in the online trading room. Don’t
trade alone. And don’t bite off more than you can chew.

Preparing for the Day of Trading, Step by Step

The work of day traders begins a while before trading opens. Readying
yourself from the technical and fundamental aspects is important for