The only way to find out how to turn a losing or borderline lucrative currency trading system into a winning one is to record all of your trades. It doesn’t make much difference whether you are trading in the genuine market, in demo or maybe back testing. Having a clear and all-embracing record of every trade is the only thing that may give the opportunity to see where your system is succeeding and where it is failing. Then all you’ve got to do is look for a technique to eliminate some of the losing trades, and your profits go up, possibly doubling or even trebling without any need for extra trades or systems. Your tracking system does not need to be complicated of tricky to administer. Most traders use a spreadsheet to record their trades. You will keep this on your personal computer naturally but you might also want to print a blank one to fill out as you trade each day . It is mostly faster to fill out you chart with a pencil while you’ve got the information on screen, than to switch into Excel and type the right figure in the right space on your spreadsheet.
The first thing to note is that if you use several different trading methodologies you need to record them on separate spreadsheets so that you can see which need attention and which are doing fine and shouldn’t be messed with. They might also depend on different indicators so you’ll need different column headings for your numerous systems.
As well as the opening and closing costs and profit in pips, there is other information that you should record. You will want your position size, costs ( spread, fees etc ) and the actual profit and loss in dollars ( or the currency that your account is held in ). This is going to help you see whether you might increase your profits by changing your position on different types of trades.
You might also want to record the categorical signals that made you open the trade. As an example if you’ve got a system that depends on the stochastic being in the highest or lowest quintile ( above eighty percent or below twenty percent ) you can record the exact point it was at when you made a decision to open the trade.