I have attached a copy of a trading journal that I have used for years, it has helped me keep track of my progress. How important is keeping a trading journal to one's success?
I think its very important in that hopefully it brings to light the mistakes one is making by looking over ones trades. I use a free google spreedsheet that I can bring up on any computer. Today was important since I noted that I did not chase my entries like I sometimes do. This allows me to get into the trade with a reasonable stop and a decent target. Also, you can easily see if you are over trading during a bad losing day vs less trades on a winning day. Let's say for example, on a winning day you make 3 trades. You don't want to make 10 trades on a losing day and end up have a double or triple loss vs a winning day even if you were using the correct stops and targets for each trade. I was able to get into the trade with a limit order, I said to myself if it does not let me in and runs away without me that is fine I can always take a trade later in the day or even the next day. I also was able today to get out at my target price with a limit order. I did not make the mistake of lowering my target due to fear that price would retrace and get me stopped out. I did decide to take a walk after I was in the trade so that I would not feel any emotional response once price started moving and was able to come back and the trade was done. I think its sometimes better to lower your stop a little rather than your target but you still need to make sure you give the trade enough room to run. You can't jump into or out of trades on minor movements for or against you. Also, you need to be patient to get long or short at the correct price setup based on your edge (defined as a profitable trade setup based on either past experience or hours watching price charts and price action). You can't trade every minor support or resistance level that price will not respect. You need to see that during the day price is respecting the TA. For example, some days are in fact more random. If price is not respecting TA that day, you don't want to keep making bad trades. Instead wait for another day. My trade spread sheet has the following: Day Trade setup Trade result win/loss summary. Day = day of week. Trade setup = why you got into the trade. Trade result = what happened during the trade. Summary = what you think you did right or wrong. For example, today I put down that I did not chase my entry and let trade go to target. For win/loss you should put a number. Then you can either use that or the Trade Report tool of your charting program to calculate win%. The lower the win% the farther away you need for your target vs your stop. The higher the win % means you can have an equal risk vs reward and make money.
On thinkorswim charts I place a simple line showing the price & time of buying/shorting and extending to the closing price & time of the trade. Using the edit function dialog box I can be fairly accurate. I use one color and a heavy thick line for gains and another color for losses. I then save the settings on an ongoing basis. Makes it easy to see in various time frames.
If keeping a trading journal leads you to successful trading, then it was important. If keeping a trading journal for years has lead you nowhere, then it wasn't important, except to establish the fact that trading isn't for you.
Don't keep a journal per se, i should! I do, however, play back the day that evening, I never miss. Examine the trades I took, those that i should have taken. It must be THAT EVENING while it's fresh in the mind. Not a day later or two.
I fully agree, even though it is very taxing i feel as if it helps me to get a picture of how many trades i made, how i felt when i traded, was i happy when i made the trade, did i win or loose the trade etc. I was able to get a picture of my activity based on a daily or monthly journal.