You may have heard of a trading journal. This is where day traders track their trading activity. It is one of the most important things you can do as a trader. Trading is not just a bit of fun – it’s a job, and because of that, you need to track your performance so that you can make changes if necessary. Even if you’re tired or stressed after a long day of trading, it’s important not to become careless or complacent, and to spend the time filling your trading journal.
How to Track Your Trades
Tracking your trades may seem like a daunting process. You may even feel like it will take your time and attention away from trading and could lead to you missing the right trades. The good news is that a trading journal doesn’t need to be time-consuming, especially these days. Certainly, you can write in a journal in the old-fashioned way with notes and comments and if that works for you, it’s perfect. But, there are other effective ways to store information that are quicker.
Set Up a Spreadsheet
This may take a little time to set up, but once it’s organized, it’s just a matter of plugging in the information. Have a different column for each bit of information – date, time, price, profit or loss etc – and input the information as it becomes available. Make sure to include notes on the side, even down to noting if you were feeling ill that day! At the end of the day, you’ll be able to go through every trade you made to see how you performed over that day, week or month. With a lot of trades, this sort of manual tracking may become difficult, but some trading platforms may have this information stored for you so that you can simply download the data onto your own spreadsheet. You can then add comments and notes to describe the market conditions at the times of the trades.
This might sound complicated, but it’s actually probably the quickest and simplest way for you to track your trades. Most traders have charts which they mark throughout the day, which include lines and indicator levels, and are used to help them determine trends and find target points. You can use these exact charts for your tracking. Even better, these charts show the market conditions being traded in a more objective way than comments in a journal could. You can just take a screenshot of these charts and type up a few comments on the side.
Keeping track of your trades can be a simple and quick exercise, but one that is very important if you want to become a successful trader. Whatever method you use to track your trades, you need to go back at the end of the week, and the month to analyze your trades. This will help you see patterns, determine your strengths and weaknesses, and spot common problems. It is only by using this information that you will be able to improve your trading strategies and remove your obstacles to success.