Used properly, a trade blog or journal can help you track your behavioral tendencies and their usual outcomes to make the most out of it.
Here are some of our suggestions:
1. Balance the negatives and positives
It’s common for traders to write about what they did wrong or what they missed especially when writing about a losing trade.
But if that’s all that your trading blog entry contains, the odds are you will wind up feeling frustrated when you review your log and read about all the mistakes you’ve made.
Instead of focusing solely on the things that you did wrong, dedicate a part of entry to what you did right and what’s working for you. It can be as simple as acknowledging that your analysis was correct or that you managed to cut your losses in time.
Too much negativity in your blog entries can be damaging to your trading confidence in the long run so it’d help to balance it out with some positive thoughts on your trading.
Write about both your strengths and weaknesses so that you can use your journal to enhance your trading performance.
2. Focus on learning
Aside from writing about your thought process during the trade, you should also identify the lessons you learned so you know how to react to the same situation when it repeats itself.
By putting these thoughts down in words, there’s a better chance of remembering these lessons and applying them next time.
For instance, you can take note of how you could’ve played the trade better or how you could’ve pressed your advantage by adding to your position. You can also write about which technical or fundamental signals could’ve allowed you to exit early and cut your losses.
Of course you can’t guarantee that these lessons or rules will result in profits the next time you apply them to a trade, but they will help you get an edge in the markets.
By doing so, you can make sure that each trading day provides an opportunity for learning and growth whether or not you were profitable for the day.
3. Stay goal-oriented
Jotting down observations is helpful but, unless you act on them, they will be nothing but observations.
You must turn your observations into simple concrete goals. If you noted a trading mistake, you should determine what you should’ve done differently and turn that into your goal for the next day.
It will do you no good to dwell on your mistakes and negative thoughts. Instead, focus your efforts on how to overcome the same negative situations in the future.
For example, if you find that you get trigger-happy and tend to overtrade after experiencing a couple of wins, make it your goal to keep your hands in your pockets and be more prudent the next time you find yourself on a winning streak.
There you have it, folks! I hope you enjoyed those simple yet effective tips on how to make the most out of your trading blog.
Little by little, these changes can do wonders for your trading psychology and possibly your account as well.