What is a trader's diary and how to keep it?

What is a trader's diary? Why do you need a transaction log? How to keep a trader's journal? The answers to these questions can be found in our article.

Hello gentlemen traders! There are many examples of how useful a trader’s diary is, they are written about in books and professional traders speak, but not everyone uses it. Hence such disappointing Forex trading statistics. And all because novice traders do not want to keep a journal of transactions because of their laziness and as a result they fail because they cannot control their emotions and do not observe trading plan . Today you will learn what a trader's diary is, why it is needed, how to keep a trader's journal, and how it will help you to succeed in trading.

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What is a trader's diary?

The trader's diary (it is also called the trader’s journal or the transaction journal) is the statistics for all transactions that you made during trading. It is usually filled manually or lead to Excel. Many traders may argue about keeping a trader's diary, as there are now many different services like MyFxBook that collect all your data about completed transactions automatically. Here you can see all the statistics about your transactions, maximum drawdowns, yield curve and much more. But MyFxBook does not replace the trader’s journal, it complements it, since the trader’s diary is not just a report of your trading, it is an indicator of your discipline. You can always go back to your trader’s diary, see which deals you have made, to understand the reason for your failures and how to improve your trading system.

Trader Diary Application

Trader's magazine will be effective in all types of markets, including Forex and stock market. It can be used on any trading instruments, such as currency pairs, stocks, indices, futures, options, cryptocurrency etc. A trader's diary can be kept regardless of which terminal you are trading in - MetaTrader, QUIK or web terminals. It will also be useful on real accounts and on demo accounts. If you want to improve your trading results, you need to start keeping a trader's journal.

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How to keep a trader's log?

There are several aspects for keeping track of a trader’s trade journal:

  1. First, we record the deals in the trader’s journal and only then open them in the trading terminal. This will prevent you from opening random transactions that do not comply with the rules of your strategy and your trading plan;
  2. Always take screenshots of your transactions immediately after opening a position and after closing it;
  3. Record comments, for what reason did you open this or that deal (the intersection of moving averages, the appearance of candlestick model , etc.), and why you closed it (the appearance of the opposite signal, closing by stop-loss or take-profit, news output, etc.);
  4. Set up a separate transaction log for the trader for each trading week and sort them by monthly folders, and keep monthly for annuals. It is very convenient and simplifies the search and analysis of transactions;
  5. View your trader diary for the week and month, analyze your actions and make changes to your trading plan, if required.

Create a table in Excel and write the following transaction information there:

  • time to enter the market;
  • trading instrument;
  • order type (pending or market);
  • buying or selling;
  • the reason for entering the transaction;
  • transaction volume;
  • stop loss size;
  • take profit size;
  • reason for closing the transaction;
  • The final result of profit or loss (in points and a percentage of the deposit).

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The trader’s diary helps you understand how you control your emotions when opening trades, during trading and when closing positions, and how clearly you follow the rules of your strategy, trading plan and money management . After the end of trading, you can look at the transaction log in order to evaluate your actions from the side and understand what weaknesses you have that hinder you from trading profitably. For example, you may notice that you open trades too often, even where you don’t, that you take profits on trades too early or hold losing positions for too long. Thus, the trader's diary allows you to soberly assess those moments that prevent you from succeeding in trading.

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