Test entry, exit and abstention as one procedure

Two jobs before real money

The archive sequences training as two jobs. The first job is to learn the house methods and techniques. The second is to remain on a simulator for a long period before using real money.

Regardless of market choice or prior experience, practice still starts on a simulator so the techniques can be learned without risking money. Early cash losses are said to produce frustration that stops learning.

The practiced habit is a repeatable checklist of entry, management, abstention and rehearsal, kept until those pieces fire as one procedure instead of as improvisation under stress.

A simulator is only a rehearsal if fills are realistic

A simulator is treated as adequate only if fills are realistic. A fill that occurs merely because a desired price is touched is judged an unrealistic rehearsal.

Extended simulator rehearsal is meant to model fills and news conditions realistically enough that the same rules can later be executed with money.

Every listed rule has to fire

Recipe-style techniques require five or six entry conditions to align. If any one is missing, the trade is not taken.

Taking a trade after only some checklist items fire is treated as a discipline failure. The standard is that every listed rule must be satisfied.

A widespread execution failure is holding losers and exiting winners.

The stop bounds the loss and the entry

Stop-losses are required on every cash-market trade discussed. In the S&P emini the usual bound is no more than two points, or 100 dollars, per contract.

The stop is a pre-placed point-based bound that also caps the acceptable entry, so loss size is decided before the order is sent and remains attached for the life of the position.

The stop is used as an entry map. If planned risk is two points and the stop sits at 1505, a buy above 1507 is refused.

An open position without a stop is treated as unbounded risk because a policy surprise can invalidate a familiar chart, and a single flush can erase the account.

Practice can last a year

Simulator work can last as long as a year when the trader cannot yet apply the recipes or the required mindset. Practice includes watching news in a realistic fill environment.