Trading plans and journals

A trading plan is a written set of rules that decides what, when and how you trade before any money is at stake. A trading journal is your record of every trade, showing whether you followed the plan and how it performed.

What a trading plan covers

A useful plan is short enough to follow and specific enough to remove guesswork. It usually includes:

• Markets and times: which pairs you trade and in which sessions.
• Setups: the exact conditions that must be present before you enter.
• Risk per trade: for example 1% of your account.
• Stops and targets: how you place them and your minimum risk-reward ratio.
• Daily or weekly loss limits: when you stop trading and step back.
• Review routine: when you check your journal and adjust the plan.

Why write it down?

In the moment, with money moving on screen, decisions get emotional. Rules written in advance, when you are calm, act as a guide you can check against. If a trade does not match the plan, you do not take it.

What to record in a journal

For each trade, note:

1. Date, pair and direction.
2. Entry, stop-loss and target prices.
3. Position size and amount risked.
4. Result in money and in R (multiples of the amount risked).
5. Whether you followed the plan, and how you felt.

Reviewing your journal

A journal is only useful if you read it. A weekly or monthly review can reveal patterns you would never notice trade by trade, such as a pair that consistently loses, a habit of moving stops, or results that slip after a big win. Include your trading costs, as they affect the real results.

Key takeaways

• A trading plan sets your rules for markets, setups, risk and limits before you trade.
• A journal records each trade, your result in R and whether you followed the plan.
• Regular reviews turn your records into evidence-based improvements.
• Writing rules down helps you stay consistent when emotions run high.