ETF trading journal can play an important role to boost up a trader. Obviously, Many traders lose their hopes after facing multiple market crashes. To be a successful Forex investor, you must keep a trading journal to assess your performance and figure out your weaknesses.
What is a trading journal?
A trading journal is like a book, which keeps all the records of your previous trades. You can write down all your business activities in a business journal. There are several benefits that an investor can get from the journal. After losing a series of trades, a businessman can take a break and analyze his previous trades. In this way, he can find out the reasons for losing those trades. Keeping and maintaining a business journal is like operating a nice spreadsheet in the PCs.
Many experts in Singapore opine that a business journal can be beneficial to generate consistent profit from the market. Anybody can identify his strengths and weaknesses for business. Remember that nobody can win consistently without facing a single market crash, but investors face it due to the lack of concentration in most cases. Look here and study the expert trader’s analysis to get a generic idea about trading. It will give you strong confidence in trading and make you a great trader within a short time.
How does a trading journal hold your concentration?
When an investor starts his business career in the foreign currency exchange market, he has a little knowledge about it. Lack of sufficient knowledge often leads to financial losses. Some businessmen run too many indicators and overload the trading chart with them. Furthermore, they don’t realize the importance of technical analysis and don’t even think of analyzing the chart, resistance, and support level. However, a business journal will help you in three different ways –
- You can set up the entry and exit points easily.
- You can stick to a specific business strategy and can modify it based on the requirements and needs.
- You can figure out the limitations that need improvement.
How to create a Forex trading journal?
While making the journal, make sure that you add the following data in it –
- Entry and exit price
- Profits and losses
- Factors affecting the trading performance and controlling the price movement
What are these factors?
Many people get confused as they don’t realize the factors. These factors include the GDP, unemployment rate, interest rate, economic performance, and so on. Likewise, all these things will provide you with a clear idea about the upcoming currency’s value. Besides, without tracking the economic calendar, you will never realize what is going on around you.
As a matter of fact, there is more information that you will need to collect for your Forex trading journal. A trader should include his entrance date, the time, set up, strategy, currency, lot size, timeframe of the trade, stop-loss order, risk management or money management techniques, the net profit or loss, etc.
How can you review the journal?
Many businessmen successfully create a journal to evaluate their performance, but they don’t realize how they should analyze and review it. Besides, In this case, an investor should –
- Find out the common patterns that lead him to losses
- Find out the common patterns that lead him to profits
- Get the ways to decrease the losses and to increase the net gains
Several patterns like the wrong business strategies, emotional decisions, wrong timeframe, avoiding stop loss, and take profit order can lead the deal to the loss. A businessman should find out the lacking and make necessary adjustments to reduce the overall losses and increase profits.
Tools to make the journal
Professional recommends that beginners try two tools – Google Docs, Google Sheets, Microsoft Paint, TradingView, and Snagit to develop a business journal. Certainly, these tools are completely free, and beginners can access them from anywhere.
These are ways to develop an informative business journal. However, for more updates on trading and related stories, keep in touch with Quintdaily.