Last few days before 2022 and these moments are when we usually look back trying to sum up the past year. Not only in trading but in life too.
I always loved journaling, I learned this practice from school and stoics books (especially Marcus Aurelius – Meditations). Journaling is not just a little thing you do to pass the time and to write down your memories, it’s a strategy that has helped brilliant, powerful and wise people become better at what they do.
But in trading it’s pretty different and it required me a few years to refine my technique and make it solid. One of the first times I heard about journaling in trading was from Tom Dante in this CWT podcast episode. Then I began to study around and learned different journaling ways that adapt to my trading style and strategy that eventually helped me improve on so many aspects.
Dr Brett Steenbarger said in one of his articles: “The common goal of all journals, however, is to cement important observations and facilitate reflection and creative thought. When we take ideas out of our heads and commit them to screen or paper, we become thinkers, writers, and readers. That enables us to process information more deeply and in multiple ways“. I can’t agree more. Journaling can improve our self-awareness, making us more mindful of both what we are doing well and what needs improvement.
Anyway, enough chit chat. I will list here below the types of journals I adopted. They’re all pretty simple and free to use. They work for me. I also tried different software but never got in love with them. Some were expensive for such poor data and some were time consuming. I won’t name them as I dislike bad advertising but for real: you don’t need to spend anything to get good at journaling (imo).
- DISCORD server
I have my own Discord server (nobody’s invited) that I use as a note taking app. Discord is free, the search function is amazingly accurate and you can create different channels for different categories. Also, if I recall correctly it offers unlimited data so…
Below a quick explanation of my channels but honestly you should do your own.
• DIARY is where I write PA notes: things that I notice from time to time and that I like to review weekly. Simple ideas and price behaviours. What happens on: red news, HTF levels interactions, time of the year, etc.
• CHARTWORKS are my morning outlooks and end of the day reviews. Same ones I post in my Telegram channel everyday – extremely helpful exercise if you ask me.
• TRADES is self explanatory. I first add them to Notion app (will explain later) during the week and then on Saturday usually I just copy and paste notes + screenshot into Discord to review them once again.
• MISSED are just missed trades for whatever reason. This is an awesome exercise I recommend everyone to do. Mark down 50-100 times one missed setup (or pattern) and no doubt you will begin to see in advance next time you encounter it.
• MAP stands for mental map. This is a concept I took from Jared Tendler and his book (already mentioned a few times in my blog): The Mental Game of Trading. It consists of instant notes taken right after some emotional decision in my trading process. Professionals write in the journal as soon after significant events occur. That allows them to observe what happened, how they processed the event, how that processing impacted them emotionally, and how they might process the occurrence differently and more constructively. I’m just trying to replicate. Ngl: I used to write much more in this channel than I do nowadays, probably because I finally started to acknowledge the emotional patterns that lead to being uninclined or out of sync. But in the past, this channel was definitely my busiest one and I recommend everyone to make their own. Huge help for discipline improvement: especially when I used to blow accounts. Just write down extremely quickly what happened in that moment, your ideas, your emotions, your execution, what you felt, what brought you there, etc. You will eventually begin to recognise the triggers and so become able to stop them in advance.
• WEEKLY REVIEW is exactly that, me analysing my week performance after reviewing every trade I took – all the notes taken during the week: my mental map, my FED sheet value (explained later below), what I learned in the past week, what I can do to improve, etc.
- NOTION app
This is just a simple table I made myself where I note down every trade I take during the week (this is my last week traded of 2021) before reviewing on Saturday and copying trades in my Discord (as mentioned above).
Few interesting key points from my Notion system may be the following.
- RATING: which is based on 5 factors I evaluate before taking any trade, so it’s a value I give before knowing the outcome of every play. Then logically, I will compare the stars rating correlated R and PnL.
- ATTRIBUTES: are the characteristics of my overall trading process. Blue are good, purple are “meh” and red are the bad ones. Then I take the most mentioned and copy them in my weekly and monthly reviews. If I see a red attribute appearing way too often, I stop trading and try to check my trading plan or execution plan in order to fix that determined issue. Simple tool, highly effective.
- HP is the hypothetical R (reward), meaning what happened if I wouldn’t touch the trade at all (moving SL or changing initial TP idea). Learned the hard way to stop micromanaging setups.
- FED sheet
This is a simple Google Sheet where, at the end of each trading day, I write down my performance divided in 3 categories with a quick summary note. The categories are: F – focus, E – execution and D – discipline. Then I follow with the account values: change in %, PnL and balance. This system helps me to visually correlate trading outcomes to personal performance. It’s another idea I took from Jared’s book and to be honest it’s super simple and quick to do.
I connected my cTrader (platform I use to trade) to myFXbook which is a free website that offers portfolio tracking and imo it’s awesome. Here there’s nothing I have to do myself to fill data, I just review weekly and monthly to see some interesting stuff like: most profitable day (or hour), duration of my trades, pips, etc. Screenshot is from my last week trading in 2021 (as other pictures you’ve seen above).
It’s a good tool but sometimes data is not 100% exact because break even trades can be counted as winners or losses depending on PnL, as well as one winner that you may take partials on the way to TP will count as multiple winners which in reality are not. Anyway if you are smart enough to ignore these little issues there is good information to get out from this page. I know cTrader offers this type of data itself, but I like MFB more.
- VOICE MEMOS
This is a funny one tbh. I know it may sound a bit weird but at the end of each trading day I open the app (from iPhone or Mac) and talk to myself like I’m someone else. It’s another idea I took from an awesome book probably named before in my blog: The Psychology of Trading by Dr. Brett Steenbarger. The concept explained in the book it’s called “Internal Observer”. It’s a big topic that deserves a proper study and I can’t really summarise it here in a few words. I highly recommend reading his book or at least his free blog.
You won’t believe how helpful this type of journal is. Every weekend when I listen to my comments I laugh at myself (in a good way) because it’s always so simple from the outside when you’re not emotionally involved. Again, amazing help for personal improvements with so little effort. 1-2 minutes recording per day: totally asymmetric bet. Highly recommended.
- PAPER DIARY
Last but not least a simple diary. Nothing fancy or sophisticated. I use it for personal life as well as for trading related things. For example if one day I had an argument with someone from work and if that could relate to my focus levels; or if I’m coming back from some travel and feel tired; if I had some injury while doing sport; etc. You would be surprised to realise how many things reflect in your trading that have nothing to do with charts. Again: I love journaling and that’s just a part of myself now that I can’t afford to lose.
This is it. It probably sounds too much or overwhelming but for me it’s not. I trade only one pair (EURUSD) and one strategy (which consists of 2 setups). I love the idea of being one trick pony and probably expand myself elsewhere in the future once this game is fully mastered.
Journaling is a huge part of my trading process. Only by comparing recent performance to past performance you can understand if you truly are improving in your trading or having an actual problem.
If you have got any question or some tweak & trick you apply yourself for journaling and want to share then feel free to comment section below. Also please: be smart, don’t try to copy me or anyone else around. Get inspired by people and build your own strategy and process. Trading is extremely personal, what works for me may be dumb for you and vice versa. Hope it helps.