I am starting this journal as a method of keeping myself accountable. I want this to be a forum of shame where I am forced to admit when I've broken my own rules.
I will be trading a VWAP-based system that I've been developing over the past few months. I will evaluate my performance each trading day based on my adherence to the following rules:
1. No large losses. In other words, no moving stops and no averaging down. When the original stop is hit, take the loss and get out.
2. Do not trade until a trend has developed. For purposes of this system, I define trend based on how far price has separated from the daily VWAP. This means that some days there should be no trades at all.
3. Stick with the trend. For purposes of this system, this means long trades only when price is above the VWAP, and short trades only when price is below the VWAP.
4. No chasing. Wait for advantageous entry points near the VWAP.
If I stick with these rules and still have a losing day, I can attribute the loss to the system or to market conditions rather than trader error. I've had way too much trader error lately, and I'm hoping this journal will help curb that problem so I can at least start to develop a clean record of system performance.