Trading Journal Book
trading journal will track all your trades in a trading journal. By following this simple, easy to follow trading journal writing tip, you as a trader can easily improve your trading results. Here is how you do it:
Step 1 - Write down WHY you are making a trade BEFORE executing a trade transaction on your journal.
Prior to opening a trade position, write in a journal the reasons why you are making the trade. It doesn't have be long; it doesn't even have to be in compete sentences. Just write in the trading journal a few key reasons why you are making this trade.
Be honest with this stock trading journal. If you are honest, it will prevent you from making the biggest mistakes in your trading. If you see that you are making the trade because of anything other than a sound strategy. DO NOT MAKE THE Indices TRADE TRANSACTION!
If you make a losing trade, do not open another trading transaction immediately so as to make profits to neutralize the losses you have made, this is referred-to as revenge indices trading, do not revenge against the stock trading market. Switch off the PC computer, walk away, and take a very cold shower to cool down. And remember that you will never lose money which you do not put in. A winning strategy isn't only about how much you win, but how much you do not lose.
Step two - Write down how you will exit the trade BEFORE making the trade.
Don't get trapped with a great entry trading strategy without an exit strategy. Your trading strategy should have both great entry & exit strategies. One is useless without the other.
But you ask, Why bother? I know my trade exit strategy. Why do I have to write it down?
Well, the reason is this: human beings are at best irrational, impulsive, and emotional creatures. If you have your trade exit strategy written down, you have a point of reference when you get out of a trade position. You will refer to your trading journal BEFORE exiting a trade. If you're closing a position for any reason other than your original trade exit strategy, you must ask yourself why?
Your trading journal will save you more money than you can imagine. It will prevent you from making impulsive moves, which is usually why people lose money in stock indices trading.
Step 3 - Write down why you exited the trade position.
This should be same reason that you wrote in step 2. If it is not, it is up to you to interpret it. The most common reason why traders deviate from their trading strategy is lack of discipline. Your trading journal will be looking back at you with glaring evidence of exactly why you are not a winning trader.
Step 4 - How Do I Analyze the trading results
You must learn from your own mistakes in indices. This is the best way for any trader to improve their profits. Everyone makes mistakes, but great traders are able to learn from them & not repeat.
And best way to learn from your mistakes is to document them in a stock trading journal. A few years down the road, you can still look back and realize that you are still making the same errors you were when you first began trade online.
This information cannot be found in any book or seminar. Your trading journal is personal and is uniquely you. Your personality will determine type of trader you will become, and will also determine type of mistakes you will make.
Not only does your trading journal highlight your weaknesses, it will reveal the trading transactions that are most profitable. After a little while you will see the type of trading setups that make you most funds, and a pattern will emerge. Don't let this data on your journal go to waste.
You should do all effort to understand why those trades went well & try to replicate it as often as possible. Profitable traders know their strengths & weaknesses. They play on their strengths & try to minimize their weakness.
Do not get lazy and forget to write in your trading journal. Documenting your thought process is fastest and surest way to get better at indices trading. Do this consistently, and you will learn more about your habits than you can imagine.
Your trading goal is to spot & break the bad habits as soon as possible. If you notice that you always cling on to a losing trade transactions too long, you should do everything that is in your power to prevent this from happening again.
Summary
Your trading journal is indices. It contains a wealth of information that will play a vital role in your success as a trader.
We urge you to use it for atleast one month. If it hasn't helped improve your profits in thirty days, then feel free to stop.
But be sure to try it prior to deciding not to. It might be just the trading tool needed to push your trade to the next level toward becoming a successful trader.
