Intentional trade journaling - what it is and how to use it to trade successfully

January 19, 2023
Weekly Trading Insights

Dear TradeZella,

How can I effectively recap my trading month?

Being intentional with journaling will allow you to uncover truths behind your wins and losses and help you identify areas of improvement.

That sounds great, but what does intentional journaling look like?

It’s crucial that you can easily answer the following:

  • What is your edge?
  • What is your trading style?
  • Where do you gain or lose the most money?
  • How much do you risk per trade?
  • What conditions suggest you stay cash?
  • What are your rules? Why did you establish those rules? Did you follow them?

Analyzing this information provides you with the foundation to take the next steps in implementing improvements.

First record the process in a trading journal. Then, implement the process.

What specifics should you look at to answer the above questions?

Look at these KPI’s (Key Performance Indicators):

  • Winning/Losing Days
  • Individual trade averages (Risk, size, winner, loser)
  • R multiple or Risk to Reward
  • Mistakes
  • Setups

Look for red flags within the data. Look for where the disconnects are. Where are you losing the most money? Why?

One of the most important KPI’s… R-Multiple.

No monthly recap is complete without a deep dive into risk/reward.

This is a non-negotiable for long term trading success.

You should strive to only take trades that have a high R multiple- based on raw price action.

Going more into this topic, explore the reasons for differences in your planned R- multiple and your realized R-multiple.

Are you exiting too early? If so, why?

Next, assess your trading psychology.

One of the great parts of a trading journal is the ability to view metrics for trades and dive deeper into the numbers.

In addition to that, it’s equally important to record your mental game.

Assesing your trading psychology

Record how you’re feeling during the trading session.

You just had 3 green trades in a row. How do you feel?

Maybe you just lost money due to an error on your platform and now you’re peeved.

Perhaps you’ve taken a few trades and you’re feeling dialed in, focused, and in the zone.

Let your journal know!

Commit to the recap.

Take a day towards the end of the month and search for meaning behind these KPI’s and your trading psychology notes.

As the saying goes, the more you put into it, the more you get out of it.

Once you’ve got the intentional journaling part down, implement your findings across the next 100 trades.

Rinse and repeat.

With this monthly recap process, you’ll start to see strides in your trading performance.

Whats new this week?

Side-by-Side Chart Comparison

Last week we launched an exciting new feature to add to your journaling toolkit: The TradeZella Replay feature.

Haven’t heard? The Replay feature allows you to go back in time and relive your trade as you journal it - candle-by-candle.

What’s more is that you can see the tape as price action is playing out.

This week, we’ve added the ability to add a second chart to your individual trade, so that you can spot any correlation or contrast between another ticker and the one you traded.

Neat, right? Especially helpful for those high beta names.

If you’re finding this to be too overwhelming for your view, no worries!

We’ve also included the ability to hide the market depth from your individual trade so you can focus on what’s important to you.

TradeZella User Highlight

How small adjustments made this trader profitable for October

Holy green! What a solid October month for one of our users.

TradeZella user's October Trading Calendar Overview

Big changes were made from September to October and we’re here to share.

In September, he was able to rack up quite a few green days with excellent R-multiples attached.

Some notable days include 8.6R, 11.2R,and even as high as 14.9R. Fantastic risk to reward there!

As many traders may relate, a handful of red days held some of those profitable days back a bit.

It’s okay, it happens! All part of learning and development.

This trader used those red days and journaling to his advantage because October saw a huge turnaround towards his goal of consistency. Let’s take a look:

TradeZella User's Cumulative P&L Chart

This is an excellent example of a healthy P/L curve.

Steady moves up, with proper risk management limiting downside drawdowns.

What are some things he did to achieve this stellar performance?

This TradeZella user mentioned that one factor leading to his success this month was keeping losses in line with his wins.

The next KPI he improved was his profit factor. Going from a 1.5 to a 1.8 on the month.

Focus on keeping your losses limited while riding out your winners, and you’ll be able to improve this metric too.

What’s in store for November?

Keeping it consistent with journaling is top of mind for this trader for the upcoming month.

Next, he wants to improve his win rate to 60% and maintain his green streak.

Can’t wait to see the progress achieved in November!

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