As a novice trader, you may be wondering why it is necessary to create a separate trading journal. Though forex brokers almost every day to give a statement (statement) real-time of your trading. If traced, the reports or statements provided by the broker only serves as a report for its customers just not to improve the ability of its customers. Hence a separate trading journal is required which aims to improve self-efficacy, identification of errors and other benefits.
Trading Journal will not only summarize all your trading, but will give you a glimpse, the state of your trading account from every trading or transaction you make and the accumulated effect of all trading up to now. In other words, it becomes your personal performance data base. You will see your profile picture as a trader, how often do you trade, how successful you are trading, what pair is better for you to trade and the best time frame for you to raise the percentage of profit. Depending on what analysis you want, you will be able to gather a lot of information from your historical data.
Trading journals not only record your actual trading data well, but also should be able to provide information about what your plan for each trading. This feature allows you to consider any trades you will make before you place an order position. You can read the article on Trading Plan here. In other words trading journals become a way for you to record your thoughts and make it possible to turn dreams into reality.
Another very important thing that also needs to be considered is the verification of your methodology. With this method you can see how well the trading system you apply in the market. This will answer questions such as: How is the performance of the trading system in the market, what time frame is right and the impact of your trading decisions such as placing stop loss, too close or too far? In order to get full details for a particular methodology, the trade journal must be completely comprehensive.
Modification of the Mind Pattern (Method of Changing Habit)
One of the most useful features of trading journals is there is evidence or fact to change your (wrong) trading habits. As you learn how to trade you, you will develop your level of confidence. The most important mental and emotional factor in trading is the level of trust.
Having a trading journal is an invaluable tool for being successful. You will find that a good trading journal will be your best friend and mentor to improve your trading skills.