Hey everyone,

You've probably heard by now that it is absolutely essential to keep a forex trading journal. Without one, and without taking the time to review it, you could very well end up repeating the same mistakes over and over, rather than progressing. Contrary to the cliché, practice does not make perfect. You have to make sure you're practicing good habits, not bad ones. Keeping a journal will also tend to slow you down between trades (which is a good thing for most people).

But how do you start?

Nothing fancy is really needed... you can do this easily in a paper notebook, and often this is the quickest & easiest way to get started. But the important thing is that you start.

You want to keep track of your entry price, exit price, total profit or loss (in pips), timeframe, currency pair, long or short, the thoughts behind your entry, your reasons for exit, as well as jotting any emotions you experience during the trade, and how you feel about it afterwards looking back with the 20/20 clarity of hindsight. The reason for all of the above is eventually you will see patterns emerge, just like in trading. You want to do more of what consistently wins for you, and avoid the things which don't.

Get yourself a glue stick - you can right-click on a chart in MT4 and print it out (I suggest changing the background to white first). Stick the chart in there right with your notes, and go ahead and mark it up.

Then, in addition, measure the total move (start to finish), and take your total profit as a percentage of that move. If you captured 75-100%, you get an A. 50-75% is a B, 25-50% is a C, and 0-25% earns you a D. If the trade was a loss, you get an F. Have a column for both the percentage, and the letter grade. Averaging your grades over time will easily show you if you are making progress.

Two more columns and we're all done. Take a look at your entry. If you were 1 candle too early, you get a T-1. For 2 candles too early, T-2, and so forth. If you got in a candle too late, you get a T+1, and so forth. Same thing for your exits. Again, you will see clear patterns emerge over time. Some people tend to be too jumpy and early, others tend to be unsure and wait for too many confirmations, and therefore end up being late and chasing. Knowing which you are will help you know how to compensate.

Hope this helps!