Why you need a Trading Jounal

At its simplest level a Trading Journal (or Trading Diary) is a record of your trades. It shows you all the winners and the losers and gives you breakdown information on each of them.

Now you may wonder why you need to record your trade data separately given the high level information is going to be available from your broker/charting system but bear with us, we think it's important to help you maintain your trading consistency and profitability.

Record the Data

Over time your Trading Journal will give you a historical perspective of your trades. It will show not only your trades but the status of your trading account so it is effectively your personal performance database. And the more data you capture the more useful this historical record will be, so in addition to the entry and exit points capture the timeframe you were trading on, what the market sentiment was at the time, how you were feeling, if there was any economic news that day etc. etc. The richer you can make the picture the more useful it will be.

Planning

Now that you have a historical record of all your trades you'll be able to see which set-ups work best for you, on which markets, at what times and on which timeframes. These you can feed into your Trading Plan. Your Trading Plan becomes your 'bible' on when to trade, when not to trade and which set-ups to take. As you take more trades, you feed these into your Trading Journal and then reviewing the journal enables you to update your plan. Think of it as a classic quality circle: think, do, check, act. That way you can continuously improve your trading performance.

Trading Strategy

The journal is a way of recording your thoughts and actions which you can then analyse and improve upon. There is nowhere to hide, a Trading Journal forces you to evaluate the decisions that you made in the cold light of day against the profit or loss that you made. You'll know when you took a good trade or when you took a stupid trade. If it was a stupid trade, look at what you're recorded and find out why. The forensic review of this information will help you improve your trading. Once you get in the habit of reviewing your trades and finding out the good, the bad and the ugly you will be able to update your Trading Strategy. This means you'll take better trades overall by doubling down on the great trades and avoiding those ones were you didn't do so well.

Trading Psychology

Trading can be an emotional game and the key to being consistently profitable is to avoid those emotions. Having a clear Trading Plan sets you up in the right way. But in the heat of the moment it can be too easy to be swayed by what you think 'looks' like a good trade. However, if you've done your Trading Journal and put in the hard yards doing your analysis the good and bad trading habits are now embedded within your brain. That means you are more likely to revert to the correct behaviour and less likely to revert to the incorrect behaviour. The more you do your journal the more these good practices will get embedded in your way of working.

How To Create a Trading Journal

You can create your own Trading Journal but it's worth taking a look on the internet as there are many free ones available. Often these interface directly into your charting package saving you some of the work. Some will even download a snapshot of the actual chart, the more sophisticated they are the more you will pay. Whatever you do make sure that you get two key pieces of information for all your trades: the numeric details of the trade itself so you can do modelling on your winners and losers plus a printout of the actual chart indicating your stop loss level, your target level, the actuals and mark the reasons you made the trade on it i.e. why did you think it was good at the time.

 Understanding what you did and why is key to helping you improve.

With Inteligex you don't need to learn complicated technical analysis. It gives you all the indicators you need to make great trades day in and day out. Importantly the Inteligex 3 Step Process brings discipline to your process which gives repeatability and helps with your trading psychology. Inteligex is supported by full training and support, we're with you every step of the way. Our customers love us, come see what they say.

To find out more about how it works sign up for your FREE no obligation Personal Consultation.

Useful Links: Common Trading Mistakes, What is a Recession, The Problem with Economic Forecasts, What is Monetary Policy, What is Fiscal Policy, Picking Stocks in 2023, Your Best Shot at Goal, Speculating vs Investing, Profile of a Futures Trader, Invest in Yourself

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