The importance of setting your trading rules BEFORE you trade cannot be understated.
Even if your trades are unsuccessful, follow your plan! If you don’t follow your plan, you have no basis from which to learn, review and improve.
Trading is all about psychology and in particular controlling fear and greed. Fear that you’ll lose money and obsessive thoughts about making money.
To be a successful trader you must develop the discipline to overcome these emotions. If you don’t then you’ll make bad decisions over and over again.
It’s no good just being aware of this. You actually have to experience it yourself. Develop self awareness with regard to your trading patterns and cultivate the discipline to break bad patterns.
This is where a trading journal is incredibly helpful
When you document a trading plan and assess how well you did in executing the plan, and what emotions came into play, then over time you build a valuable set of data which is all about you and your performance.
As soon as you have entered all your trades over the course of a month or so, and reflected on how you handled them then you are guaranteed to learn a lot about yourself and how you trade.
It will make you a better trader!