Daily Trading Journal

Record your thoughts and emotions on a daily basis with a Daily Trading Journal to improve your trading. This is one of the easiest and simplest steps that can be undertaken and also one of the most important. Think of your day of trading as nothing more than an information gathering exercise. Imagine all that information and experience you collect as you trade. Everyday no matter what level you are at as a trader you learn something new. Without a journal you are throwing so much of it away and significantly without a journal you are in serious danger of repeating your mistakes. In this regard, keep-ing a journal is a money and risk management technique. By identifying possible trading problems, you can start to resolve them. And enhance your trading system.

What should you record in your journal?

1. Have a copy of your goals, and note your progress in achieving them. Do this daily and at week’s end and then for a macro perspective do it at month’s end
2. The anatomy of every trade. Write down, from the moment you started analyzing a stock to the moment after you sold it, how you felt at each key moment about every activity you undertook. For a scalper this may indeed a brace of trades as you are in a groove. For a basket scalper it alludes to the set ups you reacted on.
3. Evaluate & compare how you should have reacted, in light of what your trading rules book. For example, how did you feel as you approached your stop-loss? Write down what feels good and what feels uncomfortable about what you are doing. Remember your aim is to get into a zone, a groove or a flow.
4. Be alert to outside influences, news, market emotion, other traders - ask yourself do they help or hinder.
5. Notice a pattern, types of stocks, sectors, single positions, and multiple positions – what suits your personality? Are you letting things happen because something doesn’t suit you & you don’t speak up?

What do I get from the journal?

1. Discover yourself and your trading when you actually record your thoughts – this is a necessity to bring your trad-ing to the next higher level.
2. Learn the importance of tracking all your trades and learn how to interpret your performance to improve your trading results.
3. Learn how to view your trading from a macro to a micro level of performance and what information is really im-portant and what isn’t!
4. Know when you are in the flow, think of our emotions as more of an invaluable guidance system. When we're feel-ing good, the energy is flowing freely our emotions are telling us, 'that's right, you're in the flow, you're where you belong.' When we're feeling "negative" emotions such as fear, loathing, anger, etc we become self-destructive. It is like there is a little man inside you cutting you off from your power source and causal effect is you resist the well being that always surrounds you – it is simply whether you see it!
5. Nothing is more painful than to be cut off from your source, and negative emotion is the quickest, most reliable signal of being off-track. You need to know when this happens, what leads you that way off course and you have to believe that you "deserve" to succeed and that suffering is not in some way ‘character building,’ Yes it is but this stage in your trading you could do without that bit of character building!
6. Guess what when your emotions are in check trading the benefits are huge for your whole life! The positive en-ergies flow onto others around you and back to you – a perfect circle! “What goes around comes around” 7. Of course if that circle is broken it becomes a downward spiral and that is what we guard against and that is why we never stop keeping the journal.