How doing a trading journal helped me to become a better trader
I started simple trading in 2018. Okay it wasn’t really trading. I downloaded BUX, invested 100 EUR and bought Netflix shares. Over time I observed how the value went up and down and realized that there is a chance to sell high and to rebuy low. I did it and slowly slowly made some money. I started my research about trading, opened my trading view account to do technical analysis, watched videos on YouTube, listened to Podcasts you name it.
Even in the very first book I read there was the importance of a trading journal mentioned. I started it but stopped it pretty soon because of the effort. Instead I tried all those promising trading strategies people talked about and over time my trading got worse. Really. I learned so hard but the impact wasn’t positive but negative.
After I nearly lost all my wins I made a hard stop. Something had to change. So I researched again. But this time about trading journals. How others do and use them. I can’t remember the guy’s name but there was this guy who maintained a huge EXCEL sheet and collected lots of data for each trade he did. He even backtested with this sheet.
In the end he was able to predict the success of a trade based on all confluences involved in a trade. Confluences like…
“Bullish Divergence on the daily time frame”
“Retrace to 0.618 Fibonacci”
“RSI oversold on 4H time frame”
“Bullish engulfing candle on 1H time frame”
…and many more.
He also combined those confluences with the hard facts like instruments, day time etc. There are really specific times where specific instruments can go crazy. For example Tuesdays are really interesting when you want to trade Bitcoin.
It was a lot of effort. But I also lost a lot of money so I decided to give it a try. I extended the idea and also added my mood and sleep to the journal. If you ever opened a trade just because you lost another and wanted to try to get your money back, you know how important discipline is. I also added trading view screenshots to my trades as proofs for the confluences I was seeing.
Over time my trading improved. Not just my trading. My confidence in my trades increased and therefore I was able to handle stop losses and risk so much better. The result was high risk to reward ratio trades and less losing trades. I also needed less time for trading. I just opened the high confidence trades and because of this I also reduced the daily time for trading from fairly 6 hours per day to a maximum of 1 hour per day.
I’m a developer. So it was no coincidence that I started to think about using machine learning. My goal was to predict the trades chance to win upfront. I used all the data I collected over time and started to train the algos. It worked and with the help of machine learning I was able to increase my trading results again. I still do because the predections are getting better and better over time.
Finally I’m not just a developer. As a guy who worked more than 15 years in startups as founder or in leading tech and product positions I also love to build great products and great product teams. This is why I started my journey to build a trading journal app to help myself, but even more important, and others to improve their trading strategies over time.
I made a plan to release an app, traders can use via the web or as a mobile app. I created my first landing page and also a Kickstarter campaign to validate the demand for such an app.
Now I’m curious. Would you use such an app? What would you expect from it? Which questions would come to your mind? What are your experiences with trading journals? Let me know and if you like what I do feel free to support the project too.
