What’s a buying and selling journal: what knowledge do I want to research?
We discovered it vital to research the buying and selling diary by pulling out the next vital knowledge:
- Screenshot comparability
- Profitability of revenue and loss and RR
- the error you’re making
- In case you deviate out of your buying and selling plan
- Your feelings all through the buying and selling course of
- Submit-trade info
- Missed buying and selling alternatives and why
Let’s talk about every intimately and see what you may get from every.
screenshot evaluation
inaccurate evaluation
Your preliminary guess concerning the value vary could also be mistaken and trigger you to make unhealthy buying and selling selections.
For instance, you understand that the assist or resistance stage you recognized is definitely barely decrease or increased than you initially thought.
Recognizing this could enhance your analytical expertise and make you extra cautious when on the lookout for key buying and selling zones.
greatest setup
Evaluating successful and shedding trades by screenshot evaluation can reveal patterns and variations in commerce setups.
Fastidiously examine the candlestick formations and value actions main as much as the entry factors for each successful and shedding trades…
It is best to search for similarities or distinct options within the setups of successful trades that weren’t current within the shedding trades.
This sort of evaluation will enable you learn to commerce efficiently.
As at all times, you will need to be sure that the pattern dimension is giant sufficient to make this evaluation dependable.
Keep away from unexpectedly adjusting your buying and selling technique primarily based on a single occasion of success or failure.
Analyze revenue and loss and dimension of losers vs. winners
Analyzing revenue and loss (PnL) could seem easy, however there’s extra to it than simply calculating your successful proportion.
I need you to grasp that normally, successful proportion doesn’t suggest that a lot.
“Reiner, wait a second…Does it matter if I do not win?!”
Nicely, successful proportion itself doesn’t essentially imply profitability.
It is best to take into account whether or not you can also make extra money on successful trades than you lose on shedding trades.
Let me present you…
Buying and selling outcomes desk:
OK, this is a small pattern dimension of seven offers.
Even when your win fee is as little as 28%, you possibly can nonetheless see constructive outcomes by specializing in threat administration and maximizing your earnings on successful trades…
On this instance, a $10,000 buying and selling account and a 2% threat per commerce would end in a rise of $560.
Whereas this situation is probably not sustainable with such a small pattern dimension, it highlights the significance of prioritizing high quality over amount of offers.
Analyzing revenue and loss knowledge permits you to establish patterns akin to shedding streaks and the necessity to decrease losses, that are key to enhancing and strengthening your buying and selling system.
Figuring out and eliminating buying and selling errors
Early on in my buying and selling journey, I noticed the significance of decreasing the variety of errors.
Each mistake, whether or not it is a small mistake or a significant setback, cuts into your backside line.
Nevertheless, making errors is a part of the educational course of, and it is okay to confess your errors.
What I’ve discovered from expertise is the significance of specializing in just one or two errors at a time.
As an alternative of attempting to repair all the pieces without delay, repair one or two of them over the following month.
For instance, if I am continually overtrading or not following threat administration guidelines, I will take a look at that.
This fashion, you possibly can work on making good buying and selling habits part of your day by day life.
Then deal with the following downside.
This step-by-step strategy permits you to make significant progress with out getting overwhelmed or overextending your self.
Over time, this methodology has confirmed to be efficient in enhancing my buying and selling course of and making it extra secure and worthwhile.
Evaluation of failure to observe the buying and selling plan
Serious about occasions while you failed to stay to your buying and selling plan will help you perceive the way you make selections.
Attempt to perceive the true causes on your actions…
Have your feelings gotten in the best way of your rational pondering, inflicting you to deviate out of your plans?
Take a step again and truthfully assess whether or not you’re sabotaging the system.
By recognizing these moments and on the lookout for the basis trigger, you possibly can develop methods to forestall comparable habits sooner or later and develop into a greater dealer because of this.
Monitor sentiment throughout trades, not simply earlier than and after trades
On longer time frames, giant market fluctuations can happen through the course of a commerce and are topic to sentiment.
Chances are you’ll be tempted to exit the commerce early for a small revenue or a small drawdown.
These feelings can tremendously affect resolution making and result in poor buying and selling outcomes.
That is why it is vital to trace your feelings earlier than, throughout, and after a commerce.
Take into account taking fast notes of your emotions and ideas because the commerce progresses. However do not soar into motion instantly.
This strategy permits you to brazenly view your feelings with out interfering along with your buying and selling system.
It helps you keep disciplined and observe your buying and selling plan, which finally permits you to enhance your total buying and selling.
It could be doable to research what occurred after the termination
We extremely suggest that you simply analyze your trades just a few days after you shut them.
why?
First, over time, your feelings will transfer away from buying and selling.
This implies you possibly can clearly and realistically assess the precise efficiency of your trades.
Secondly, this evaluation permits you to see if there’s potential for enchancment in any space of your buying and selling technique.
For instance, in case you assessment 10 trades and discover that in 8 of them the worth continues within the course of the commerce after the commerce closes…
…This can be a fairly sturdy indication that there could also be room for enchancment within the exit technique.
Armed with this strategy, you possibly can modify your revenue taking and even perhaps run your winners additional earlier than exiting.
Lack of buying and selling alternative
Documenting these alternatives in your buying and selling diary can be a invaluable behavior.
As soon as you’ve got recognized the set off on your missed entry, take into consideration what was happening on the time.
Have been you away on private enterprise?
Or is it merely a missed alternative? (it occurs)
Realizing why offers are missed will help you enhance your processes and make higher use of your time.
It will enable you see in case your technique is appropriate throughout totally different pairs and time frames.
Serious about why you missed out on these offers may also enable you perceive deeper points akin to worry, doubt, and laziness.
You’ll be able to determine tips on how to take care of these issues and observe your buying and selling plan with extra self-discipline.
In any case, it’s a motivation that can serve you nicely and remind you ways vital it’s to stay alert and disciplined when buying and selling.
