Trading Journal: Usage and Format

introduction

When we learn from mistakes, we become a better version of ourselves for the future. You cannot learn unless you remember the mistakes. Also, you cannot remember unless you keep a record of your activities. In the transaction, we cannot repeat mistakes by maintaining well-maintained documentation of our ventures.

What is a trading journal?

A trading journal is a systematic, chronological record of all transactions carried out by a trader or investor. In other words, it is a diary focusing solely on transactions, not general observations, events, or life experiences. The crypto market requires even more high volatility and relatively high unpredictability. Trading journals are in the form of Excel spreadsheets, but traders generally add text records in the form of comments to related cells or attach optional MS Word or Google Doc files.

Why maintain a trading journal?

Trading Journals can add quality to your trading carrier. It’s easy to determine which strategies are profitable and which ones flop. Entry points and exit points reveal essentially useful information about the transaction when documented along with analysis based on opening positions.

To find out your strengths and weaknesses

You have some strengths and weaknesses. Your weaknesses can be found not only in failed transactions, but also in transactions that have made emotional decisions. Note that successful professional traders do not classify a trade as successful and failed by looking at profits and losses. They see that their best deals are those who stick to planning and strategy until the end of the trade.

I’m getting more disciplined

If you want to remain disciplined and consistent, you need to write a trading journal. Undisciplined traders open positions on a whim. Failed trades can drive you to open a revenge trade that will make you lose more money. Professional traders will analyze the market for several days and decide on subsequent trades. Swing and trending traders typically trade more than 5-6 trades per year. The TradingView platform slogan is highly suggestive in this respect.

Self-calculation is possible

Self-calculation is another advantage that comes from maintaining a trading journal. After we argued that trading journals help you find your profitable trades and follow them, the points seem to be repeated, but your self-calculation ability will vary as it helps you maintain your attention while trading. There is a tendency to avoid repeating errors made in failed transactions. The very idea of documenting your transaction will keep you vigilant.

Being emotionally mature

Finally, they tend to trade only when they are confident about the validity of their analysis, as they are disciplined, consistent and self-calculated. FOMO cannot take over you. You are not an overtrade. You don’t make emotional decisions. You don’t get hooked on the words that Moon Boy is the fate of social media.

After learning everything about the benefits of maintaining a trading journal, dive into the process of how to design for yourself.

How to create a trading journal

There are many ready-to-use formats available online, but you need to know what constitutes a trading journal and how to design it. To enter numerical data, you will need to create a new MS Excel sheet or Google sheet. However, you must record the text that accompany the data. For this purpose, there are two options: Right-click on the cell you want to record your thoughts and click on the Comment. A small pop-up window allows you to add text to each cell. The second option is to create a separate file in MS Word or Google Docs.

The following format can be used as a reference point if you are not willing to design your own journal:

An entry can be a column just like a row.

Trade Metadata

• Transaction ID: Token You Trade ticker ($BTC, $ETH, $XRP, etc.)
• Date/Time (entry).
• Date/Time (Exit)
• Exchange/Platform
• Trade Type (drop down): Spots, margins, futures, options, etc.
• Strategy/Trade Style (Dropdown/Text): Day, swing, scalping, position (or custom strategy name). For example, it indicates whether it is a scalp or swing trade.
• time frame (Text/Dropdown): Chart time frame or duration of analysis (5 minutes, 1H, 4H, daily).
• Account/Portfolio: Account size and location size.

Input and End Details

• direction (drop down):Long or short.
• Entry price (number): Open price.
• Crypto size (number)
• Entry value (number): Total USD value for entries
• Initial stop loss (price) (number): Stop price placed on trade entries.
• Initial stop loss (%) (number): Stop loss as a percentage of entry price
• First Take Probit (Price) (number): The target price set at the time of entry.
• Early Take Probit (%) (number): For-profit will be adopted as a percentage of entry price.
• End price (number)
• Fees/Committee (number): Total fees will be paid (USD or native coin).
• Net P/L (USD) (number): USD profit or loss after fees.
• Risk Reward Ratio (Planning) (number): Ratio of target profit and initial risk (input versus stop).
• Risk Reward Ratio (actual) (number): Actual ratio achieved (profit and stop distance).

Risk Management

• Position size (% of wallet) (number): The scale of trade as a percentage of total trade capital.
• Maximum loss permission (%) (number): If an outage is hit, the maximum % of your account is at risk.
• This effect (Number/Text): Used leverage (for margins/futures).
• Risk per trade (%) (number): Actual risk (stop loss distance) as a percentage of the account.
• Location Results (drop down): Hit TP/HIT SL/Manual Exit.

Of course you can add many additional columns, but I recommend keeping things simple.

The text portion should include any technical or basic analysis you performed before you began trading. We also recommend that you record your emotional ups and downs through trade.

Conclusion:

A trading journal is a useful record of your transactions. It will help you become a professional trader, focused, disciplined, wise. You can create your own journal or follow a ready-to-use format. The text portion of a transaction is just as important as the data. So don’t forget to record your thoughts and feelings before, during and after the transaction.