I call it “women’s intuition.” We’ve all heard the term and there is in fact research* evidence suggesting women have some sort of “psychic” ability to discern other’s feelings and what they are thinking. Many fellow forex trading heroines such as Jody Samuels from JP Morgan also admit that they sometimes follow their heart and gut feeling on whether the market is going up or down.
Intuition or instincts can be either a starting point for your analysis or a final determination of what position to take.
For example, you open up the chart of EUR/USD (Mr. Euro and Miss USA forex party room) and in the first sight you feel the market is bearish. Then you will look for fundamental, technical and sentiment support to back your feeling up.
Another scenario, is after you have done all your study and analysis, you are sweating and still not sure if the analysis is going to work. That is when you can use your intuition to confirm (or negate) your trading decision. The best advice here is that if you are not sure, then don’t do it! And certainly don’t simply hope that the market will move in your favor. As Martin J Pring wisely points out:
“Hope is not a good thing to have in forex trading”
Do not ever trade only based on your intuition, EVER!
While you may be able to use your intuition and follow your heart in trading, you need to make sure that you are not confusing these feelings with fear and greed. You ALWAYS have to back up your intuition with other types of analysis provided by Invest Diva.
There is a BIG difference between intuitive trading and emotional trading and you should be very careful not to confuse them. If you are making a trading decision and you find that your heart is racing as if you are about to go on a first date with the man of your dreams, you are probably making an emotional rather than intuitive decision.
You will be able to get more deeply into overall analysis once you have finished drinking all the essential Beans that will get you there. That is drinking up the Technical Beans, Fundamental Beans, Sentimental Beans, and Capital Beans during your Coffee Breaks. You will be crowned as a Forex Diva once you have drunk up your Overall Beans.