For the longest time, I traded without any real structure—taking positions, forgetting about them, and moving on without ever stopping to evaluate what worked or what didn’t. It was a chaotic cycle, and I had no clear understanding of my trading habits. It wasn’t until I started keeping a detailed trading journal that I truly began to understand my own behaviors and patterns.
They say, “what cannot be measured, cannot be improved,” and this couldn’t be truer for trading. Journaling has not only helped me track my performance but also revealed deeper insights about my decision-making, including one big revelation: I was overtrading.
In this post, I’ll share what I discovered from my trading journal and how it helped me address one of the most common pitfalls in day trading.
1. Too Many Trades, Too Little Profit
The first glaring issue was the sheer volume of trades I was making in a short period. While day trading naturally involves more frequent trades than longer-term strategies, I realized that the quantity of trades I was making didn’t align with the quality I was aiming for. Worse, many trades resulted in very small profits or losses.
Take this example: I had several trades with marginal gains like +1.3% and -2.2%, followed by others like +3.5%. Sure, the wins outnumbered the losses, but the profits were so small that they barely covered the losses from a few bad trades. This is a classic sign of overtrading—trying to squeeze profits from every tiny market move without waiting for higher-probability setups.
2. Impulsive and Revenge Trading
Another major red flag that came up repeatedly in my journal was emotional trading. Many of my trades were tagged with reasons like “impulsive” or “revenge trade.”
This is something I’ve struggled with for a while. After a losing trade, the desire to “get back” what was lost can lead to revenge trading, where I jump back into the market without a clear strategy. It’s a vicious cycle: impulsive trades lead to losses, which lead to more emotional trading.
One of my biggest losses, a short trade on NEIROETHUSDT, was driven entirely by revenge trading after a previous loss on the same pair. I failed to stick to my strategy, entered without proper confirmation, and ended up with a -118% loss. Lesson learned: emotional trading never ends well.
3. Stop Loss? What Stop Loss?
In day trading, stop losses are non-negotiable. Yet, in many of my trades, I either didn’t set a stop loss or canceled it midway through the trade. A lack of stop loss—or constantly adjusting it—leads to huge drawdowns that could easily be avoided.
For instance, in one trade, I canceled the stop loss because I was convinced the market would turn in my favor. It didn’t, and I ended up with a -7.37% loss. That was entirely preventable had I stuck to my initial stop-loss plan.
I realized that by skipping or canceling stop losses, I was increasing my risk per trade and, ultimately, my anxiety levels. It’s a form of overtrading that I hadn’t recognized before: I wasn’t just trading too much; I was trading recklessly.
4. Not Letting Trades Develop
In reviewing my journal, I also noticed a pattern of closing trades too soon. This happened often in positions where I entered a trade based on solid technical analysis, but as soon as the trade went slightly against me, I panicked and closed it prematurely.
Several trades, like my short on PENDLEUSDT, were noted as “closed too soon” during a clear downtrend. Had I been patient and allowed the trade to develop, I would have hit my profit target. Instead, I cut the trade short, only to watch the market move in the direction I had anticipated.
This impatience is another sign of overtrading: I was so eager to lock in small gains that I wasn’t letting my winning trades play out. As a result, I ended up taking more trades to compensate, often leading to more losses.
5. Switching Between Long and Short Trades Too Often
One of the clearest signs of overtrading in my journal was my tendency to flip between long and short positions rapidly. In day trading, reacting quickly to market conditions is necessary, but my frequent switches between long and short trades seemed more like chasing the market rather than executing a planned strategy.
For example, I would go long on a pair like ETHUSDT, only to switch to a short position minutes later when I saw a minor retracement. This indecision led to inconsistent results and often left me stuck in low-quality trades. Instead of trusting my analysis, I was reacting emotionally to minor market fluctuations, which isn’t sustainable for day trading success.
6. Inconsistent Use of Technical Indicators
Lastly, while reviewing my journal, I noticed that I relied heavily on CVD spot and perp up/down for most of my trades. While these indicators can be useful for identifying market sentiment, they shouldn’t be the only tool I use to make decisions.
Inconsistent results showed up repeatedly: some trades based on CVD signals were winners, while others with the same setup turned into losses. This inconsistency led me to realize that overtrading based on single-indicator signals isn’t enough. Instead, I need to combine indicators and follow a more structured approach to confirm trade entries.
How I’m Addressing Overtrading
Having identified these patterns, I’m making some changes to my approach to avoid overtrading:
- Fewer, Higher-Quality Trades: I’ve set a personal rule to limit the number of trades I take per day. By focusing on fewer trades, I can ensure that each one is based on a solid setup with a favorable risk/reward ratio.
- Strict Stop-Loss Rules: Every trade will have a predefined stop loss and take profit, and I’m committing to not canceling or adjusting them based on emotions.
- Improving Emotional Control: I’ve started keeping an emotional journal alongside my trading journal. If I feel the urge to trade impulsively or seek revenge after a loss, I take a break and come back to the charts only when I’m calm.
- Diversifying Technical Analysis: While CVD remains part of my strategy, I’m now combining it with other indicators like moving averages and volume profile to confirm entries and exits.
Conclusion
Overtrading is a common pitfall for many day traders, including myself. While it’s easy to feel the need to constantly be in the market, trading frequently without a clear plan or emotional discipline can quickly lead to losses. By reviewing my trading journal, I’ve identified several red flags that indicate I was overtrading, and I’m working on addressing them to become a more consistent trader.
If you’ve ever felt like you’re overtrading, I encourage you to review your own trading journal. Look for similar patterns—whether it’s impulsive trades, emotional decision-making, or excessive flipping between positions—and take steps to address them. In the end, trading less but with more precision will likely lead to better results.
What are your biggest challenges in day trading? Feel free to share your experience or tips in the comments below.
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