What is a Trading Journal?
A trading journal is a record of your trades for future reference.
It is a powerful tool that most traders use to measure and improve their performance in trading.
A trading journal can help any trader track their progress in trading.
It can also help them to spot mistakes they make in trades and correct them accordingly for better results.
You can tell serious and potential consistently profitable traders by finding out if they keep a trading journal or not.
Traders who wish to consistently make profits in Olymp Trade create and keep a trading journal.
But for those who are new to this concept, how do you create a trading journal for your Olymp Trade account?
In this post, I will show you the easiest way to do it!
Tools Used in Creating a Trading Journal.
Here are the tools you will need to create your own trading journal.
- Microsoft Word or Google Docs.
These are free word processing software you can use to write down your thoughts, observations, and analysis of the markets.
- Microsoft Excel or Google Sheets.
These are spreadsheet software you can use to record the relevant parameters of your trading.
- Screen Capture tool.
If your device can capture the screen displaying the charts then use that feature.
If it can’t, you can use other screen capture tools like Snagit and the likes.
- Microsoft Paint.
This is a free image editing tool that you can use to edit captured charts and add annotations to them.
Creating a Trading Journal for Your Olymp Trade Account.
With the above tools, creating a trading journal is very easy.
You only need to use each tool for its purpose and then you will be good to go.
Ensure that if you record information on different softwares, they are concurrent and can easily be followed.
Everything else you do from here is just recording.
You record your trading journey in relevant software and according to your needs as you continue to trade.
In matters recording, the information you record is divided into two:
- Before the Trade.
- During and After the Trade.
A. Before the Trade.
Before you take the trade, there are specific things that need to go into your trading journal.
These are basically things to do with your analysis of the market and the set up you are looking for in order to trade.
The reason you must capture your thoughts and analysis is to increase the chances of spotting such setups you are looking for.
If you don’t capture that information in your trading journal, you may miss most of such setups and end up making fewer profits.
You can see that the trading journal also helps you make more profits.
Your market analysis and the setups you are looking for must be in line with your trading plan.
You cannot take trades that sharply contrast with your trading plan.
Analyze the markets and establish which trade setups you are looking for.
After that, you can choose to record on Word software or a spreadsheet.
Make sure to include the following in your recording:
- The time frame – for example, the 4 hour time frame.
- The Asset – for example, GBP/USD.
- Your Market analysis – for example, the market is in a strong downtrend and has bounced off MA 50 the last three times.
- Trade Set-Ups You are Looking For – for example, if there is a retracement upwards to MA 50, I will look for a bearish candlestick pattern then sell.
- Your Stop Loss level – for example, 2 pips above the swing high.
- Your Take Profit Level – for example, at the swing low 1.1825.
B. During and After the Trade.
During and after the trade, there are specific things that need to go to your trading journal as well.
These are things to do with relevant parameters of the trade and then charts of the trades you took.
Here are relevant parameters of the trade which must be captured:
- The date you entered the trade.
- A time frame of the chart when you entered the trade.
- The trade set up which triggered you enter the trade.
- The market or asset you are trading.
- Whether you are on Buy or Sell trade.
- Price you entered the trade at.
- The price you exited the trade at.
- The Lot size of your trade.
- Your Stop Loss and Take Profit levels.
- The profit or loss the trade yielded.
- The risk to reward ratio you applied to the trade.
Here is relevant chart information which needs to go into your trading journal:
- A screenshot of the higher timeframe chart – this shows the broader market picture and helps identify major support and resistance zones.
- Screenshot of the chart timeframe at entry – this shows your trade set up, entry-level, and stop loss. You can mark those levels accordingly.
- A screenshot of the chart when the trade is over – this shows the end result of the trade.
It shows the take profit level, the amount of loss or the amount of profit the trade yielded.
Wrapping Up on Creating a Trading Journal for Your Olymp Trade Account.
So why are we doing all these?
Why are we recording everything and even taking screenshots and annotating them?
It is for a good course.
You only need to continue doing the recording and updating of the trading journal for every trade that you take.
Do so for some time then review the trading journal you have created.
Here is what to have in mind as you review your trading journal:
- Try to establish which trading patterns, setups, and market conditions result in losses.
- Try to find out which trading patterns, setups, and market conditions result in profits.
After establishing the above two, you can then adjust your trading strategies in order to:
- Minimize your losses.
- Maximize your profits.
All said and done, you will realize that a trading journal has helped transform you into a better trader.
This takes us back to the beginning of this post; a consistently profitable trader is the trader who keeps a trading journal, or is he?
Let’s continue with the conversation in the comment section.