Review your Performance Daily to Improve Daily
Wednesday, June 6, 2018
TraderDock was set up to be the foundation upon which aspiring traders can not only test their innate talent, but also practice in a way that brings the accountability and intensity necessary to make any training worthwhile. The markets are forever changing. No day is exactly the same as one that went before it. But all you need to recognise at this point in your development is one specific opportunity or pattern that you can begin to trade with consistency. Find that and you have unlocked a potential treasure chest. Why? Because even if you increase your size to a point where that trade is exhausted, or even if that trade opportunity disappears, by achieving success over a period of time, you'll know that you did it once and can do it again. It is always difficult to find opportunities - everyone is searching for them. But there are more to be found with every tick change in the market's price.
As an apprentice trader, you should never underestimate the value of your trading journal. Analysis of your trading performance and the emotional rollercoaster you experience as a result of winning and losing trades are paramount to your learning process. Like sport, trading is 10% mechanical (order entry, order types, chart reading, order book reading, speed with mouse clicks, avoidance of manual errors, hardware and software setup etc.) and 90% mental. To improve your trading then, 90% of your investment should be in yourself. Train yourself to improve your trading. And again, that is more than just market knowledge. A significant portion of that investment should be on self-awareness so that emotionally, you can get out of your own way and find success. Honest journal entries recording the emotions around each trade or trading session highlight the areas that require the most attention. Are you buying when you wanted to sell in a fast market? You need to use the Daily Exercises in our other blog post to perfect the mechanics of your order entry at speed. Are you sitting in a losing trade and letting stubbornness bring you close to your daily loss limit? This can happen on a trade that was relatively meaningless when you entered it but you fell in love with it the more it moved against you. Why? Explore your ability to accept being wrong and move on. Read Flow: The Psychology of Optimal Performance by Mihaly Csikszentmihalyi, Trading in the Zone by Mark Douglas and The Hour Between Dog and Wolf by John Coats for an insight into what direction you should be moving.
Avoid the strategies offered by those on forums. Try trading for yourself. Try the markets and ideas that you think will work. There is no great cheat to the learning curve especially not from following the strategies of the crowd. Far more valuable, are your own trading lessons and they should be recorded daily in your trading journal.
Create a table in your trading journal to list on the left side those characteristics or skills that will make you stand out as a trader and on the right side those aspects of your character or your practical knowledge that you need to improve upon in order to be the best. Add to this list daily with reflections on your trading from that day. Add emotional positives and negatives regularly. Be specific. Think about how each item listed in the positive column can be strengthened or used more effectively and how you might address each of the items in the negative column. It is difficult to take the time to record an entry at the end of a frustrating, losing day. This is the time you need it most. This is where you learn to minimise the faults of that trading day. But write it and move on. This is not an exercise in beating yourself while you are down. Move on by coming in the next morning and reviewing the notes from your most positive days. Channel that energy. Where were your thoughts? What did you feel like before you got into that winning trade? What was your exit strategy? What did you do that day when things went badly? These practices will become rules and good rules will become good habits and good habits breed success.
The TraderDock Team