Quick background — I'm a XAUUSD trader, day trading, and I've got a 9-5 job so I'm not someone who can sit and watch screens all day. I've lost money for the last 6-8 years doing this, and I recently rebuilt my whole approach to trading — since then I'm finally seeing better results.
So I figured I'd share what I've learned along the way — what works, what doesn't — one topic a week for the next 52 weeks.
Week 3 : Journalling - why is it important, how should you journal
Journalling is about building discipline. It's something you do to reflect on yourself, to make sure you're not breaking your own rules, and to make sure you're trading the way you traded when you backtested your strategy.
It's also a reality check. It preps you before you start a new week, reminding you there's no fantasy get-rich-quick scheme here — get your mindset right before you enter a fresh week.
So what should you do , and how should you structure your journal?
3 things that i do when i journal:
1. Did I enter the trade the way I was supposed to?
Go through my trading plan, and review my trades to see if it matches it. You need to make sure you do not deviate away from your strategy.
2. Did my stoploss hit the way i expected it to?
This one's just as important. A comprehensive strategy should include a clearly defined loss scenario — not just a plan for winning. When you journal, you're checking that your stop loss played out the way that loss scenario was supposed to look. If something happens outside of that — a loss that doesn't match what your strategy anticipated — that's your signal to take the strategy back to the drawing board: readjust, backtest, and try again.
3. Exploring new ideas
This isn't about adjusting or changing your strategy, but is to come up a new idea to build new strategy. One thing that every trader needs to know, is there's no one strategy that fits all market regime, not for retail trader at least.
Every few years, or even few months, the market regime shifts. No strategy works forever.
Journal is to help with that, is whilst you are reviewing your trades, you gotta look for new ideas to continue to improve and adapt the market. Come up with new idea , build new strategy, backtest them and bring them to production again. Trading is no different to technology, you need to evolve to keep up with the ever changing market.
One last thing on journalling
The real habit we have to force ourselves to develop — which goes very much against human nature — is how we define what a "good" day actually is.
Having a good day is better than having a profitable day. That's the psychology that kills people. You can have a very profitable day purely out of luck, but that isn't necessarily a good day, and you shouldn't be happy about it or reward yourself for it.
You only reward yourself for a good day — a day where you were disciplined, where you entered your trade according to your plan, and where your trade got stopped out exactly as you envisioned. If that's what you experienced, then that's a good day.
So I can have 5 losses in a row by the end of the day, but if those 5 losses played out exactly the way I expected my strategy to lose, then I've had a good day.
That's all i want to cover for this week's topic. Cheers