How to Keep a Forex Trading Journal
When you trade it is important that you have a forex trading journal. It is important that you know why you should be keeping a trading journal. You should also consider how you should be keeping your journal. There are a few variations to this that you need to know so you can choose the one that suits you best.
Why You Need a Forex Trading Journal
Before you can look at how you should be structuring your trading journal you need to understand why you should be keeping one. A trading journal is a great way to keep record of all aspects of your trading. While it is possible to print a report from your trading platform regarding all the trades a journal offers something extra. With a journal you are able to see the though process that went into the making of each trade. Of course, this is only possible if you keep an accurate record of everything you do.
What Should be in Your Journal
When you start keeping your journal you need to know all the points of trading that should be included. You need to keep a record of everything that made you open a trade. This includes the fundamental and technical indicators as well as any insight from experts you may have looked at. If you are using a signal services you need to include what the signal said and when you got it.
In regards to your trades you should also state what price you entered the market and the price you exited the market. Some traders find it helpful to include the profits they have made as a separate entry. You also need to list all the aspects of your trade including the stop loss orders and the take profit order.
Structuring Your Journal
Once you know what you should keep in your journal you need to know how to structure the journal. In your journal you should have a columnar list of all your trades. By placing the trades on a column you can easily total the profits and losses of each trade. Many traders keep their trading journal as an excel file as this makes it easier to keep track of all the trades. If you feel better with a paper journal you can use this as well.
If you are using an excel spreadsheet you need to have the following columns:
- The date of the trade
- The entry price of the trade
- The spread for the trade
- The stop loss point
- The take profit point
- The trade exit price
- The profit or loss
In a separate file you should keep a copy of the charts that lead you to the trade. The chart printout needs to have the analysis tools on it. Once you have the printout you can save this as a picture on your computer or print it out if you are keeping paper records. With both of these options you have to point out what the indicators were and how you came to them. It is also important that you include any thoughts that lead you to change the trade.