One of the things that most of the beginners don’t do, from various subjective reasons, is that they don’t analyze their trades, especially the losing ones. This is one of the most critical aspects of the trading process, especially if you are still learning about trading, financial markets etc. as it can accelerate your learning curve and help you develop faster the skills that you need for profitable trading.
In this article, we’ll try to give you some useful tips each one of you can take into account when it comes to reviewing your trading activity.
Tip #1 Keep a weekly and monthly trading journal
It can be written by hand or you can use an excel spreadsheet. No matter what it is more comfortable to you, it is essential to keep a trading journal and write down each of the following aspects: entry point, stop loss, take profit, expected reward to risk ratio, reason why you opened the trade etc.
Tip #2 Make screenshots of your trades
Another useful thing that you can do is to take screenshots of your trades. If you are using mt4 platform, you can go your trading history, click on a trade that you have done and drag it on the chart. It will show you the entry point, your stop loss, and the level you closed the trade. You can then save the picture and analyze it at the end of the week, or when you have time available.
Why is that?
Because by seeing those picture, you’ll use your visual memory and store inside your brain various recurring patterns. Basically, it will develop your pattern recognition skills and you’ll be able to spot easier new setup in the future.
With that being said, this are two of the basic things you can do in order to properly review your trading activity. Hope you found it useful.
Risk Warning and Disclaimer
Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. No information or opinion contained on this site should be taken as a solicitation or offer to buy or sell any currency, equity or other financial instruments or services. Past performance is no indication or guarantee of future performance.