A forex trader needs to track his past successes and failures to correct the next steps. No matter whether you are a beginner who is just starting a trading career, or you are a pro trader and have experience in the market, it would be better to look back on previous trades. Re-evaluating is one way to achieve better trading results in the future. For this evaluation, you need to keep a forex trading journal.
According to The Balance, a trading journal is a great tool because a thorough journal includes details beyond what you can see on your brokerage statement.
Keeping a trading journal may be a difficult task. However, along with consistency, over time you will have a neatly organized trading journal that can be used for routine trading evaluations.
Example of a Forex Trading Journal
Entry time: ____________
Exit Time: ____________
Currency Pairs: _____________
Entry Price: _____________
Stop Loss: _____________
Profit Target: _____________
Trading Volume: _____________
Exit Price: _____________
Profit / Loss: _____________
Fill in each column from Day to Trading Volume as soon as you open a position (open trade/entry), while the Exit Price and the Comments section are added after the position is closed. Include how much profit/loss and make a note if necessary, about what you learn from the trading position. Forex trading journals can be made on a MS Excel spreadsheet or ordinary notebook. As a complement, you can also save screenshots of price settings and indicators when the entry or closed position, to commemorate important moments.
At the end of each week and month, go back and see what you did, notice common problems, and spot your strengths. These observations can help you exploit your strengths and highlight the areas you need to work on.
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