Journaling and recording your trades can be the difference between profitability and losing money. It’s no secret that the simple act of keeping written records of your trading behavior can point out both good and bad habits. Once you can physically see what you are doing right, you can emphasize that practice with future trades. Seeing the things that you do wrong in black and white can also help you to become more aware of those negative practices and avoid them in the future.
So what should a trading journal entail? Well, for starters, you will need to include the basic “bio” of the product you are trading. What were the entry and exit prices? What was the range of actual price during the period in which your trade was open? What did the chart look like? Keeping your journal on your computer is probably the easiest way to do this since you can take a screenshot and post it to your journal, thus capturing all of this information in a single place. The Disciplined Trader teaches you all about this and more.
Other, more obscure, information can also be helpful. What was your reasoning for entering the trade? What kind of emotions did you experience while the trade was open? These things might seem worthless, but this is far from the truth. Your mental state when it comes to trading is just as important as your technical knowledge. Grasping at the source of your decision to trade can illuminate bad habits that might lead to more frivolous Forex trading behavior. If you can pinpoint these rash decisions, you can start to improve your trading and replace it with better trades.