You may have heard different variations of the following adage:
“If you can’t measure it, you can’t improve it.” Peter Drucker
This applies to as much as any aspect in your life. Unless you have photographic memory, it’s crucial you develop a method of tracking your trades so you don’t make the same mistakes over and over again. It’s also the best way to hold yourself accountable, from start to finish.
From personal experience, my profitability has sky rocketed since I began writing my trades down in a book. Now, that increase might also be due to my piss poor performance when I started out in crypto, however I can say with certainty that journaling has helped my growth as a trader.
To give you all an example of how journaling has helped me; I was very susceptible to buying Twitter’s shitcoin-du-jour without taking into account A) If we were on support or at resistance B) What was doing in all of this and C) How much has this coin pumped as of yet?
Rookie mistakes, however once I started writing down these habits, I noticed a pattern of failure and quickly rectified it. If I hadn’t used my journal, this could have gone on indefinitely and I’d likely be underwater right now.
When I enter a trade, I write down the following:
- Entry, Stop-Loss (if applicable), and Targets (I also take a screenshot of the chart at the time of entry)
- Why am I taking this trade? (TA, FA, gut feeling, Twitter shills?)
- Where is bitcoin at this stage of my trade (on support, at resistance, in the middle, in an uptrend/downtrend)?
- Trade Management: As the days and weeks progress, how am I managing the trade? Am I sticking to my original plan or am I changing my bias? If I’m changing my bias, why so?
- Once the trade is concluded, I calculate my R:R (Risk to Reward) and keep a tab of my profitability over time.
- My moods. You’ll find over time that there are some weeks where everything is going your way, and others where you get consistently stopped out. If you can track your emotional state throughout the process, you’ll begin seeing a predictable pattern in your behaviour, which could then help you limit losses down the line.
I’m certain there are other metrics you could include in your little book of love, however that’s what I’ve found to be most relevant for me. Also, make sure you go back in that book of yours every week/month, especially when you’re coming up on a setup that you’ve taken before or an asset you’ve traded in the past.
I know all this can sound time-consuming and boring, but I promise you once you pick up the habit, you’ll thank me.
I hope this helps. If you have any questions, feel free to message me on Twitter @Bagsy_II or hit me up on my discord channel : d
Love,
Bagsy
Published at Thu, 28 Mar 2019 17:46:56 +0000
