4 Tips for Making Your Forex Journal Actionable
Keeping track of your Forex trading – whether digitally or with pen and paper – is critical for your growth as a trader. And for many, the start of a new year is the perfect time to revisit the previous 12 months of trading. Looking back on your trades will help you determine what worked, what didn’t and what could use improvement.
Yet, it’s difficult to know what you should do with your personal data. What exactly should you be looking for? And how can you use your journal to improve your trading? Here are a few quick tips for using your yearly trading data to improve your strategy:
1. Look Over All Your Data Once
Start by examining the full year of data. Look for your milestones: Your biggest wins, your biggest losses, and missed opportunities. Also, be sure to calculate your profits, losses, and the bottom line. This will help you set a baseline for your trading and serve as the point that you want to improve upon in the coming year.
2. Develop Goals For Moving Forward
Once you’ve examined your trading data, you can begin to set goals for the upcoming year. This will ensure that the data you’re reviewing becomes actionable. So how exactly should you set goal? Look for common mistakes you made over the previous year. Did you miss out on profits because you entered trades too late? Focus on how you can adjust your strategy to enter trades earlier.
3. Be Sure to Include Positive Data
As you look over the previous year, the negatives will probably jump out at you. But there’s always more to the data. Be sure you are incorporating positive points into your analysis. You shouldn’t just focus on your mistakes, your biggest losses, or your missed opportunities. You must include the positives: Your most profitable trades, your clever trading strategies, the times you entered trades effectively, your winning trade streaks, etc. By balancing your losses and wins, you’ll be able to better focus down on the areas you need to improve.
4. Keep Better Records
Moving forward, you should make it a goal to keep more thorough trading records. Are you incorporating the fundamental and technical analysis that helped you determine a trade? Do you note the thinking that you used to enter a trade? If not, you should be. The more information you provide in your Forex journal, the easier it will be to improve. Why? Numbers alone only tell one side of the story. But incorporating the steps, analysis and thoughts that encouraged you to enter a trade will help you spot the holes in your thinking.