How to keep a trading journal: template, metrics and weekly review

A trading journal is a record of every trade you take, with the reason you took it and how you felt, not just the result. Your trade history already shows wins and losses; the journal adds the part history cannot see: why. Without it, you remember the great trades, forget the impulsive ones, and draw conclusions from a story instead of from data. With it, after a few weeks you can answer the only question that matters: is what you are doing above the break-even line or not?

What to record for every trade

Write each entry straight after the trade closes, while you still remember what you were thinking. Keep the fields short so the habit survives busy days.

• Date and time (with your time zone), plus the session: Asian, London or New York. See forex market sessions.
• Instrument, and whether it was a market pair or OTC.
• Payout % at the moment of opening.
• Expiry and how it was set (duration or clock time).
• Direction: Higher or Lower.
• Stake, and the stake as a percentage of balance.
• Setup: the name of your entry pattern from your plan, for example "EMA pullback M5". If it is not in your plan, write "none".
• Reason: one sentence on why this trade, now.
• Emotion before the trade: calm, bored, anxious, excited, frustrated. One word is enough.
• Result: win, loss or tie, and the profit or loss in dollars.
• Rule followed? Yes or no.

The last two fields, emotion and rule-followed, are usually the most revealing ones. They are also the ones people skip.

A journal template

Here is a simple layout you can copy into any spreadsheet. The entries are illustrative.

Three rows already tell a story: one planned trade, then two impulsive ones, the last with a doubled stake and a shorter expiry. That pattern is what a journal is for, and it is very hard to see in plain history.

The metrics that matter

Once you have a few dozen trades, calculate these. A spreadsheet does it in seconds.

1. [Win rate](/glossary/win-rate) = wins / (wins + losses). Leave ties out.
2. Average payout of the trades taken.
3. Break-even win rate = 1 / (1 + average payout). At 85% average payout, that is 54.1%.
4. Gap = win rate − break-even. This is the number that decides whether you make or lose money over time.
5. Net result in dollars, and as a percentage of the starting balance.
6. Rule-break rate = trades with "Rule? No" / all trades.
7. Result by group: by setup, by session, by instrument, by emotion, rule-followed versus rule-broken.

Average payout deserves attention on its own. A trader who often picks instruments at 75% instead of 90% needs a 57.1% win rate instead of 52.6%, so the same skill gives a worse result. More on the threshold in the break-even win rate entry.

The weekly review

Pick a fixed time each week, away from the terminal, and go through these steps.

1. Update the numbers above for the week and for all trades so far.
2. Compare planned and unplanned trades. For most people, the trades marked "none" or "Rule? No" are where most of the losses sit.
3. Look at emotion. Do trades labelled "frustrated" or "bored" lose more often than "calm" ones?
4. Check sample size. Fewer than 100 trades under the same rules means no conclusion about the method yet. With 100 decided trades, chance alone can easily move a 50% win rate to 45% or 55%.
5. Decide one change at most. Changing several things at once makes the next review meaningless. Write the change down with the date it starts.

Worked example of a review

Illustrative week: 38 trades, 20 wins, 17 losses, 1 tie. Average payout 85%.

• Win rate: 20 / 37 = 54.1%, almost exactly break-even (54.1%).
• Planned trades: 26, of which 16 won (61.5%).
• Unplanned trades: 11 decided, of which 4 won (36.4%).

The tempting conclusion is "my setup is great". The honest one is: 26 trades is far too few to judge the setup, but the unplanned trades are clearly costing money, so the one change for next week is to remove them. A trading plan with written entry criteria makes that easier; see overtrading and discipline.

What a journal will not do

A journal does not make a method profitable, and on OTC instruments it cannot uncover an edge, because their prices are generated by Sky Trade's server as a random walk with 50/50 direction. What it reliably does is expose your own behaviour: overtrading, stakes that creep up after losses, trades taken out of boredom. That alone often saves more money than any new indicator.