Diary of Heroes: Why You Need A Trading Journal

20 Nov 2020 · Uncategorized

WRITTEN BY ThorFX

The Hero Maker

Having a work log is not uncommon in many industries. It is also used as a powerful educational tool. That’s one of the reasons why traders resort to the journaling method to enrich their knowledge on trade tactics. Thunderbolt success in trading is achieved with the accumulation of experience. So, what is a trade journal? And why is it truly a diary of heroes?

A trading journal is first and foremost a power tool. Beginner or experienced traders log their every move. The information that goes in a diary is detailed and aims to be thorough in a way that covers everything to know about a trade. From a technical perspective to an emotional one, nothing is unimportant. This meticulous approach gives traders the data they need to learn from and derive connections between events. For sure, once you begin utilizing the journal’s data in an analytical way, your performance will improve. So, a trading journal is unequivocally the key to transforming into a hero trader.

Yield the Power of the Trading Journal

If you had any doubts about the benefits of logging your trades, here is a breakdown of the reasons why it is a necessary process on your way to excellence.

Wielding the hammer of effective tactics

Every trader is in it for profitability. At the end of the day, your success is dependent on the efficiency of your strategies. In order to achieve a certain dexterity in planning and tactics practice is needed. Trials and errors are needed too. Therefore, writing your thought processes for every trade can only contribute to making you a better trader.

Controlling emotional interference

Your emotions and mental state can interfere with the decisions you take in trading. These can be impulsive moves that lower the overall trade performance. Therefore one big asset of successful traders is their ability to control emotions. Learning more about emotional intelligence through training or readings is important. But also, writing about your own feelings and triggers in the trading journal will bring you one step closer to understanding yourself as a trader. This method will enhance your discipline and promote self-confidence.

Strengthening trade performance

As a trader, the one thing that should steer your actions is performance. There is no doubt that controlling impulsive moves, or preparing effective strategies are important points. But ultimately, they are stepping stones on the way to strengthen your trading performance. That is why analyzing your logs and assessing the results of your past tactics is key.  Doing this regularly will help you craft more efficient tactics for your next trade.

How to Journal Like the God of Thunder

Practice makes perfect. That popular saying couldn’t be more true for trading. Using the trading journal method in a consistent way will allow you to reap those benefits. Once you have chosen the platform of your choice for logging trades, focus on the information you should register. Here are 10 things to keep track of to journal like the God of Thunder:

  • Note the entry and exit dates
  • Trade execution: order type, length, size, capital
  • Note the outcome of the trade
  • Market events and news on the day of trade
  • Reason for trade entry and exit: goals and conviction
  • Perceived strengths and weaknesses of the trade (errors & fixes)
  • Register any emotional triggers, state of mind, rash moves
  • What skills did you use, acquire, or lacking?
  • Rate the performance of the trade
  • Personal notes for your future self

Finally, this is your trading journal. So take the time to explore the parameters and settings surrounding your trades and decide what you would add to the log. The purpose is to help you identify market patterns and draw analysis from tactics and moves. In addition, the diary’s intent is to diligently track your trading performance. So there is no reason for you not to write down every error, weakness, or skill gap. As you go along your trading journey, increase your confidence by filling these gaps.

We leave you with a thought: it is counterproductive to write in the journal if you don’t review it regularly.  The logging is only half the job done. You are your own instructor. Therefore, to really wield the hammer of success, go back to your notes and study up.

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