Successful traders tend to keep journals and review their trades. They jot down trades and journal the thought processes, and any other data or personal items that affect their trading, which can be anything from how much quality sleep they go to position sizing, the thesis of the trade and more.
The journal, therefore, reinforces your bread-and-butter trades, helping to identify anything that is working or failing in a trade. Here’s a sample trader journal to help you get started.
Review your trades and journal … everyday
When you journal and review your trades, it helps you identify strengths and weaknesses, as well as your comfort zone and which style of trading works best for you.
Here’s a journal template that you could use to detail your trades. As you develop as a trader, you might want to add more items to this template.
June 2, 2017
Day of Week:
SPDR S&P 500 Index (SPY)
Thought process behind the trade:
SPY had bullish trading, and looked to build momentum
Entry Price and Why I Got In:
50 shares @ $243.25, got in due to bullish moving average crossover
Stop-Loss Price (Why is this my stop loss):
Stop loss at $243.00, or if 15-minute candle closes below 8-period EMA
Target Exit Price and why it’s a good spot to exit:
Exit if SPY gains 0.50% from my entry price. This is a good spot to exit, as the risk-reward ratio fits my risk profile
PnL (Unrealized or Realized):
Took profits at $244, when price closed below 8-period simple moving average
How did I sleep last night?:
Slept 7 hours, and was refreshed
What’s my state of mind? Am I stressed, tired, etc.?:
Neutral, neither stressed nor excited
Journal everything about all your trades, starting with the items here and building to it as you decide what information and what formats help you to best review and learn from your personal history.
Taylor Conway is the lead day trader at PennyPro.com. He is a short-term day trader of stocks and ETFs.