Trading Success Through Journaling: Reflect, Learn & GrowHello traders, today we will talk about how journaling can be a really helpful tool for you in your trading journey. Journaling is a simple yet powerful tool that can help you gain insight into your mental and emotional state, identify patterns and triggers, and make more informed decisions. In this post, we'll explore how you can use journaling to improve your trading performance.
1. Reflect on your emotions: After each trade, take a moment to journal about your emotions during and after the trade. This can help you identify patterns in your emotional responses and provide insight into how certain emotions may affect your trading decisions.
2. Identify triggers: By journaling about specific events that preceded a trade, you can identify the triggers that lead to your emotional responses. This can help you take steps to manage your emotions before they affect your trading decisions.
3. Evaluate your decision-making: After each trade, take a moment to journal about the decision-making process you used. This can help you identify any biases or patterns in your decision-making that may be affecting your trading results.
4. Set goals and track progress: Use journaling to set goals for your trading and track your progress over time. This can help you stay motivated and focused on your long-term goals.
5. Increase self-awareness: Journaling can help you become more self-aware of your thoughts, feelings, and behaviors. This can help you identify any negative thought patterns and work to change them, which can lead to improved trading performance.
To make the most of journaling, you should be honest with yourself and write down what you truly feel and think. Journaling is a powerful tool for reflection, learning and making adjustments for the future.
It's important to note that journaling is not a standalone strategy, but rather it's a tool that can be used in conjunction with other analysis and indicators to inform trading decisions. Also, you don't need any specific equipment, just a pen and a notebook, and you can journal at any time.
In conclusion, journaling can be a powerful tool for traders looking to improve their performance and manage stress. By gaining insight into their mental and emotional state, traders can make more informed decisions and improve their overall trading results. Give it a try and see how it can help you in your trading journey.
I would love to hear about your own experiences with journaling in trading. Please feel free to share your thoughts, feedback, and tips in the comments section below. Your input and feedback is valuable to me and to the trading community!
Journaling
USD JPY Journaling!You can see my past charts for the plays! - Journaling so I can help some people out and confirm their biases and trends!
XauUsd SELL off to start of the week?!I see this setup as a great trade opportunity to finish the year strong.
I believe Gold is going to take out this previous week low, I have my reasons for that and if it's so I'll update them to this idea
after take profit or stop loss gets hit.
As always I use this as journaling/learning purposes.
GBPJPY AnalysisWe got stopped out after price printed a pin bar rejection against the trade. Should have gotten out of the trade but was hoping for a miracle. Always market over mind
Honestly, was looking to enter a short at retracement, should have worried about the present instead.
Meanwhile on 4H
Unto the next trade
Documenting Your Trades (For Fun and Profit)How do you document your trades? In a spreadsheet? In a trading journal? Directly on the chart? How much is too much? How little is not enough?
I say you need to document enough to tell the story properly. Every trade tells a story. As with all good stories you have a protagonist and an antagonist. Good guys and bad guys. The hero and the villain. And then, there's the journey.
In the markets you are the hero and the market is the villain. One way I make trading "fun" and what helps me "tell the story of the trade" is to "Trade Like a Pirate" and use the vocabulary of Jack Sparrow. I have already written on this topic when it comes to analyzing profit targets (seizing treasure and plunder) but let's look at how we learn what we did on a trade by trade basis.
When you do an after-the-trade analysis (what I call a postmortem) you should be able to see what you did right, what you could have done better, but most importantly, what you may have done wrong; not to beat yourself up, but to make sure that you *never* make that mistake or repeat that behavior again. (Fool me once, shame on you... fool me twice, shame on me!)
For instance, I once lost three trades in a row and asked "How the heck did that happen?" and later when I looked at the actual trade screenshots I realized that both my trading timeframe and trend timeframe was the same! Somehow instead of having my charts on the 60-15 minute charts they were *both* 15 and I realized if I had my chart timeframes right I would have never entered those particular trades, saving me from experiencing those losing positions. Thanks to those trades, though, and thanks to my post-mortem analysis, the first item on my "pre-flight checklist" is now "Verify Trade Timeframes." Thanks to journaling and the postmortem process I'm *never* going to make *that* mistake again.
But what about the *psychology* of the trade? *Why* did you enter it, *what* were you thinking once you were in it, *why* did you adjust your stop, *why* did you choose your target, *what* might you have done out of fear that got you out of the trade early or prevented you from realizing as much profit as you could have?
Journaling your trade, or documenting the trade *properly* will help you with that.
In the example above you can see a recent trade that presented itself to me and my pirate "Crew" in the Gasoline Futures market. I talk about the "weather conditions" before getting into the trade (the wind and the tide), other environmental factors like the "shark feeding frenzy area" helping me decide where I will target my profit (there be treasure *here*), what was going on when the trade actually entered, and finally, managing the trade to my target. In addition, during the postmortem I found an opportunity where if I had used a trailing stop, I could have gotten an additional 42% profit, or 'treasure'.
As I mentioned in my Backtesting series, one of the reasons you backtest is that through repetition, you can often find patterns in your system that will prompt you to tweak it to either *improve* results or *eliminate* inefficiencies. In this same manner, through repetition in documenting your trades you may very well find a pattern of behavior that is holding you back from your full potential.
For example, In the trade above, after securing 3R, (the minimum I am willing to take in a trade), if I followed price using my trailing stop strategy instead of a target, I found that I could have made an additional 2-3R profit. What if after documenting 20, 30, 40+ trades I find a similar pattern, that I am often "leaving money on the table"? I can then test several exit strategies to see which ones would give me the biggest bang for my buck and increase my R per trade.
The other big benefit of having your trade journal "tell a story" rather than "state facts" is you begin to *personify* the market and see it as someone who exhibits certain behavior patterns, and that is what the markets present to us every day: PATTERNS. And if you can determine someone's patterns, you can predict their behavior.
If I know that whenever my wife is browsing through a jewelry catalog and consistently goes "ooh" or "aah" over earrings with blue stones in them, I can guess with a high degree of accuracy that if I buy her a set of sapphire earrings she (and consequently*I*) will be a happy person. Likewise, if I can predict with a high degree what "Mister Market" is going to do based on certain patterns, I can keep setting sail, with confidence, day after day and see gains in my trading account (which makes me, my crew, and most importantly the missus, HAPPY! (Because when momma's happy, everybody's happy!).
Trade well! (And Journal Well!)
PS: Let me know how your journaling journey goes in the comments! I'd love to know how it "upped your trading game!" You can only improve what you analyze!
-Anthony
