Keeping A Forex Trading Diary

When you first start trading forex, one of the most important things you can do is to keep a forex trading diary. In this diary you will want to make a note of every single trade, both winners and losers, and you should ideally add comments to each one noting why a trade went right and why a trade went wrong.

This is one of the best ways of learning how to trade the forex markets profitably. By keeping a forex trading diary you can quickly identify which trades are losing you money, and therefore you can either cut out these types of trades completely or try and modify them so they become profitable.

Another benefit of keeping a forex trading diary is that it requires and encourages discipline, which is one of the key attributes a successful forex trader must have.
The trading diary itself can be as through or as brief as you want to make it. For example, you could include a chart with each trade plus reasons for entering and exiting where you did, the maximum profit that could have been achieved, the stop losses - were they too close or too far away, and so on. Alternatively you could just record the profit and loss per trade and a quick sentence or two about why a trade did or did not go according to plan.
The important point is that you actually record your trades so that you can learn from your mistakes and become a more profitable trader in the long run. Once you get to the stage where you've developed and perfected a certain trading system that generates consistent profits, then you can start thinking about dispensing with a trading diary, but until then a forex trading diary should be an absolute necessity.