A record of every trade with the setup, reasoning, entry, exit, risk, result in R, and what you felt and did.
A journal is the only way to know your real win-rate, expectancy, and which setups pay. It also exposes patterns you cannot see in the moment: overtrading after a loss, exiting winners early, sizing up on tilt.
The minimum is a spreadsheet with date, symbol, direction, entry, stop, exit, R result, and a note. Screenshots of the chart at entry and exit help enormously.
Example: after 100 journaled trades a trader finds that trades taken after 2:00 p.m. have an expectancy of -0.3R while morning trades are +0.5R. Cutting afternoon trades doubles her results.
Original diagrams for the ideas on this page. Illustrative, not real market data.
Expectancy: the average trade. Forty trades sorted by outcome: 24 small losses and 16 larger wins. Weighting each side by how often it happens gives the average result per trade, marked here by the dashed line at +$120.
Educational only, not advice. Spotted an error? Post in Site Feedback.