Education

Trading Strategy: Documenting Your Trades

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A day trader’s day begins long before he starts trading in the market, and should end some time after he has taken the last trade of the day.

Today we will review the activities that should have to be done at the end of the day in order to maximize our learnings from the day’s activities, and grow professionally.

The trading journal

The trading journal is nothing more than our tracking sheet and a particular record of all the trades that we are making during the trading session. The standard trading journal should incorporate the basic information of each trade: time and price of entry and exit, market/ product traded, result of the trade, stop location, etc.

However, my recommendation at this point is to have a trading journal that goes a bit beyond the coldness of numbers. After all, the trading journal should be a useful tool for the continuous improvement of our trading, and I doubt enough that such cold information gives us something positive with the passage of trades, beyond pure and necessary statistics of our trades.

In this vein, it is interesting to point out, for example, our emotions during the course of the trade, to be able to have a more specific control of what is known as psychotrading, or to specify the technical reasons for which we have entered into a concrete trade.

Any information that may be useful to improve our trading should be incorporated into that trading journal, and the more information we have, the better conclusions we can draw from the session. To me, for example, I like to always record the maximum ticks that the price has been moved against my trade and the maximum ticks of movement in my favor without pulling back. That information is very practical for adjusting my profit/risk ratios.

Conclusions of the day and learning

In order to finalize a trading session properly, a brief review should be made of all trades taken and even those that have not been taken. A post-analysis is always much more reasoned than what one can do during the session, consolidating what has been done well and trying to improve on what you haven’t done well.

One goal that I try to mark day after day is to be able to get at least one learning or detail to improve in my trading. Every day, yes. Do you know the level of success one can achieve if you are able to detect an area of ​​improvement in any professional aspect of your life every single day? You’d be surprised. Happy Trading.

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