Why Do You Need a Forex Trading Journal?
Why do you need a forex trading journal and is it important in forex trading? You might wonder why it’s important to keep trading journals separately, even though almost every broker provides real-time records for each of your transactions. In fact, you can argue that the broker’s record also keeps track of the strength of the available purchase, the margin that has been used and the profits and losses for each transaction that occurred. Even so, there are still advantages to storing trading journals separately, as follows:
After some time, the journal will provide a perspective history. Not only does it provide a summary of your trading but also shows the condition of your trading account. in other words, this will be the data base for your personal account. You can see how you trade all this time, how many successful and failed trades and you can also see which currencies have better results for you.
A good trading journal should not only contain your actual trading records, but also information should be available about what your plans are for each trade.This feature allows you to consider each trade before you take it by determining the parameters in which you will enter, how much risk you can receive, where your profit target will be set and how you will manage the trading process itself.
In other words, journals become a way for you to record your thoughts in actual numbers and make them possible to change from thoughts that are expected to become real practice. This will form the basis of a method for planning your trading.
Another thing that is not less important than the reason you have to have a forex trading journal is because you can verify your method. You will be able to see how good your system is when changing forex market conditions. This will answer various questions such as how my system is in a trendy market, differences in time frames and the impact on decisions in trading such as orders to stop losses, is this too tight or loose? To be able to answer all these questions, you must provide a complete trading journal.
MODIFICATION OF MINDSET (HOW TO CHANGE HABITS)
One of the most useful features of this forex trading journal is that it will help force you to change habits from destructive to building. As you learn how to change plans, you will develop confidence at a greater level. Your profitable trading will not feel random, and your losses will feel like planned and however it will not shake the psychic that makes you feel that suffering loss is a loser.
Emotional and mental factors that are very important in trading are your level of confidence. Confidence is a remedy for the circle of fear and greed that traders often experience. Fear and greed are natural and are responses that many people have. If you win, then you want to win even more. And if you lose then you feel scared and even panic as if your account will change to zero.
Having a journal will help collect your statistics in preparing a trading plan and this is a very valuable tool to be successful. You will find that forex trading journals are good friends and mentors when you make progress.