Just write it! Most want to be traders do not do it but they should if they want to be a successful trader!
Being a trader is not easy especially if you are doing it part time or are trading alone at home. Besides trying to understand and trade the market with a sane mind set.
If you are trading from home and mostly alone, you are most likely going to get bored to death or make mistakes easily when distracted or in a moody state. Trying to maintain discipline when trading is a tough job and if you do not keep a tight ship you are going to hit some nasty waves or rocks that will damage your account if not worse.
So how can you maintain your framework and discipline when trading?
Keep a trading journal!
A trading journal helps you justify the trade to yourself before you enter it. Stops you from making emotional and rash decisions. Allows you to plan the trade and calculate risk return properly.
Once you have a plan written down it is harder to get off track and do something irrelevant and stupid, mind you the risk of doing something stupid is always there as our psychology changes at an ad hoc rate.
Also the trading journal gives you the opportunity to do a postmortem. When you make a series of losses or wins, it is a good idea to evaluate the reason for your losses or wins. The mistakes one makes is easily identifiable if it is written down. On the same token it will also show what you are doing right after a series of good trades. This allows you to make adjustments and improve your trading over time and keeps you in a frame work which allows you to make sensible decisions.
At the GlobalTrader.Club we have a template for keeping a trade journal and also a risk return calculator that will calculate risk and return ratio.
So how should one fill out a journal?
This depends on your technical analysis approach and strategy. At the GlobalTrader.Club we have a five step approach for every trade. We also make sure there is trade management in place and results and a post mortem part.
Making sure every trade is planned out. No rush jobs, especially when trading!
