Thursday Trader's Tip: The Top 3 Limiting Beliefs That Stop Traders From Journaling
Thursday Trader's Tip editions offer quick trading psychology advice that can be digested in 5 minutes.
Are you resisting journaling your trades or finding it almost impossible to keep consistency with your journal?
Then, this week's video is for you; we’ll discuss the three most common beliefs around journaling.
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Written Version:
We all know that as a trader, journaling is essential… right?
Well, it is not that obvious, but I find that adopting a journaling routine is extremely difficult for some traders.
There are especially three limiting beliefs that keep traders from journaling, they are:
I do well without a journal; I memorize everything.
These traders claim to be able to be profitable without a journal, and it can be possible sometimes in the short-term!
However, the question is not whether you can or cannot be profitable without a journal but whether you can deliver your full potential.
The biggest slice of the work is in the preparation; this is true for all top performers.
Cristiano Ronaldo's commitment to physical fitness is legendary. He invests heavily in equipment to optimize his performance—gym equipment, recovery equipment, wearable fitness trackers, GPS monitoring devices, and biometric sensors to track heart rate, speed, distance covered, and other performance indicators.
Journaling is the biggest slice of the preparation work in trading.
You might be doing well now without one, but what will you hold up to during a tough period like a drawdown? From where does the confidence come, then?
You gotta build the base of the pyramid to sustain you in those moments and come back stronger.
I’ve already tried everything and cannot find consistency with any journal.
This limiting belief comes from two sides:
Procrastination: The trader feels pressured to have ‘the right’ journal. Not knowing what the best journal looks like keeps them from having one because they struggle to accept imperfection and are afraid of mistakes.
Disbelief: The trader doesn’t really know if what he’s doing is the right way, so there’s confusion and doubt in the journaling process. They might have a journal, but when they have a tough day in the market, the pain and the weak commitment to journaling make them break the routine.
The only truth about journaling is that there is no right way of doing it. A simple journal is better than no one and will take you a thousand miles ahead. Start with the basics: the goal is for you to be able to open your trades, fully understand their context, and then analyze each one from entry to close. You’ll find more clearance once you start.
Journaling is only useful for beginners.
There are two types of journals: the log journal and the reflective journal. Many traders who are resistant to journaling think journaling is only about the log-in information, which is boring, and steer clear of it.
The most important journal is the reflective one, but you can’t reflect on trades for which you don’t have the data. So, boring data must also be collected to analyze the trades.
The reflective journal is where you’ll gain the biggest learnings and improvements. Your perspective on the trade is different while you’re trading versus when you look back at it afterward. With a clear mind, you can absorb much more detail and information that leads you to improvement.
If you see yourself in one of these limiting beliefs, don’t use it as an excuse—this is your comfort zone trying to drag you in. Once you have your journal, you’ll grow confident in your capabilities and processes.
Peaceful trading,
Sara
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