Starting a new hobby can be overwhelming. Some of us try too hard in the beginning, burn out in a few weeks, get frustrated, and quit right away. The same can happen to you in foreign exchange. Keeping a journal of your progress, however, can help you revise and build a better tactic.
You will be able to note down your preferred currency pairs, emotions after reading the WForex review and other broker feedback on FxCash, what works and what doesn’t when you open positions — everything that’ll help you learn and improve.
Understanding a Trading Journal
A trading journal includes everything related to your forex positions. You dictate what is written down there. That can include:
- date and time of the trade;
- currency pair of the trade;
- buy or sell details;
- entry and exit prices;
- how big the position was;
- stop-loss and take-profit levels;
- why did you decide to enter;
- outcome.
When you’re done with the position, you can use the rest of the entry to talk about your headspace. Write how you felt throughout the process and what you feel after closing the position. Understand if there are any negative emotions deep inside you — don’t let them influence your strategy.
You can keep a traditional paperback journal, use a specialized app for investors, or create a spreadsheet on your PC. Since trading is mostly done online, you can also attach screenshots to your entries.
Stay consistent and honest in what you write. This will help you gain multiple benefits that we will explore next.
You Learn From Your Mistakes and Wins
Just like in any other venture, you can’t expect to become a pro overnight. It takes time to learn the basics, understand the market, and gain enough experience to see positive results. Even then, experts constantly make mistakes. In forex, it’s a natural part of the process. All you can do is learn to accept them, learn, and adapt your plan.
So, journaling lets you see negative patterns in your approach, either practical or emotional, and take proactive measures to improve. Similarly, you can spot what you did right and learn from your wins. As time goes on, you can spot and focus only on the best strategies.
You Train Your Discipline and Track Progress
Although no one except you has to read what you write in the journal, it will still help you be more disciplined and stick to your original plan. Knowing you will have to explain your trades on paper or in the app, you will be less likely to break your own rules or act impulsively.
When everything is going well, you might not notice it until you track it manually. Keeping a journal lets you read through it once in a while and remind yourself that you are doing great, and there’s proof.
A Simple But Powerful Tool
Keeping a journal is not a new idea, but it’s a powerful tool that allows you to build new habits and reach your trading goals. By noting down your experience, you will be able to learn from your mistakes and tailor your strategy until it’s perfect.