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Reviewing a losing trade without rewriting history afterwards

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Tradoshi teamOfficial

The problem with reviewing a trade is not missing information, it is that you know how it ended. Once you know the trade lost, everything pointing that way jumps out and the rest becomes invisible. It is a documented bias, and nobody escapes it through good intentions alone.

THREE HABITS THAT NEUTRALISE IT, in order of effectiveness.

WRITE BEFOREHAND. By far the most effective, and the only one that really works. A note taken at entry, even two lines, can no longer be rewritten afterwards. It says what you saw when you did not yet know. Without it, the review works on a reconstructed memory, not on a decision.

SEPARATE THE DECISION FROM THE OUTCOME. A losing trade can be well taken, and a winner badly taken. If you only sort trades by outcome, you will learn to avoid what lost, which is not the same as learning to decide better. The right review question is: with what I knew AT THAT MOMENT, would I take it again?

REVIEW IN BATCHES, NOT ONE BY ONE. A single trade says almost nothing: chance alone explains it. Ten trades of the same kind say something. A weekly review of every trade of one setup teaches more than ten reviews done in the heat of the moment.

WHAT TO DISTRUST IN YOUR NOTES: « lack of patience », « lack of discipline ». Those are not observations, they are verdicts, and nothing can be done with them next week. « Exited at 1.1R with the target at 3, an hour before the close » is an observation. It can be counted, and it can be fixed.

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Trading involves a risk of loss, up to the entire capital committed. Tradoshi is a journaling and analytics tool: we provide no financial advice and guarantee no result. Futures and forex trading contains substantial risk and is not for every investor: an investor could potentially lose all or more than the initial investment, and only risk capital should be used for trading. Hypothetical performance results have many inherent limitations: they are generally prepared with the benefit of hindsight, involve no financial risk, and no representation is being made that any account will or is likely to achieve similar results. Past performance is not necessarily indicative of future results. Full risk disclosure.