Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

Johnathon

Trading Forex With Your Gut

By Johnathon, in Forex

Recommended Posts

Johnathon    10

Johnathon
Posted

Trading With Your Gut

Quite often you will hear traders or trading coaches explain part of their trading as “trading from the gut” or “It was just a feeling I had about that trade”. What the trader or coach can never explain is “what trading from the gut is” or how and why they got a feeling about a particular trade.

As Price Action traders we spend a lot of time watching charts and perfecting our craft. Over the many months and years of watching charts our subconscious brain is picking up on all different kinds of information and locking it away. Generally we are not consciously aware that this analysis is going on, or that we are noticing these different patterns and scenarios.

 

The Subconscious Brain

The subconscious brain is picking up and storing information such as the outcomes of trades, what happened when price hit a certain level and the particular trades that did not work out. The subconscious brain is very powerful and can store incredible amounts information that our conscious brain cannot.

The problem with the subconscious brain is that it cannot remember the many different scenarios exactly or the particulars of trades gone by, over many years. Even though we cannot consciously remember exactly how price played out in the many trade examples of the past, the subconscious brain can give us warning signals. These warning signals come in the form of a feeling in the gut.

These feelings could be a worried and cautious feeling or a feeling of excitement and positivity. We may not be able to interpret why we are receiving these feelings but they are very real and are happening because of a reason. These feelings in the gut serve a purpose, and if listened too, and obeyed, can help you in your trading.

 

Listening to Your Gut

Over many years a well exercised trader will watch many Price Action setups come and go. Every time these setups occur the subconscious brain is taking notice. The subconscious brain stores this analysis away and keeps it for anytime the trader may need it. The next time a trader looks to get into a trade the subconscious brain will carry out its analysis and give the trader a feeling. The trader is often confused with this feeling and where it came from.

The subconscious brain is either trying to warn the trader that it has seen this scenario or pattern, and it didn’t work out well, or that in the past similar setups have worked out great. This feeling in the gut is always there for a reason, even though the trader may not be consciously aware of why they are experiencing that feeling. It is there to help the trader make a decision.

Novice traders will often get this feeling and deliberately ignore it and try to make it go away. The novice will feel puzzled and will enter the trade regardless, even if they are experiencing a feeling of caution.

 

Gaining Experience

Traders can learn to harness these feelings from the gut and use them to their advantage. The more experience and time a trader has had in front of the charts the better and stronger the feelings in the gut are going to be. This is because the subconscious brain has more analysis from which to draw upon. As the trader gains more and more experience they will also begin to notice which feelings they receive in certain situations.

Learning to listen and obey these feeling is vital to be the best trader you can be. When traders learn to trade using both the conscious and subconscious parts of their brain they will be able to feel and trade with the flow of the market. This experience is often referred to as “being in the zone”. Being in the zone is when a trader can logically select and manage their trades, and is also aware of their “feeling in the gut” and then acts accordingly.

 

The Human Touch

Computers in this day and age are incredible. Computers can work out the hardest of mathematical equations in seconds, which would take man hours to do manually. In trading with computers and in particular trading indicators have taken the retail trading market by storm, 4 out of 5 traders are either using indicators or looking for an indicator to use. As impressive as some of these indicators may seem they do not have that human element.

To become a master trader both the conscious and subconscious brain must be harnessed and accessed. Computers will never be able to replace the human touch that helps traders to feel when things are not quite right, or when something irregular may be about to occur.

 

I hope you have enjoyed this article and can use this information in your trading.

 

Safe trading,

 

Johnathon Fox

Forex School Online

Share this post

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

×
Go To Topic Listing

  • Topics

  • Posts

    • Stocks4life
      Breakout and Swing Stock Ideas

      By Stocks4life · Posted

      AMZN Amazon stock, nice buying at the 187.26 triple+ support area at https://stockconsultant.com/?AMZN
    • Stocks4life
      Breakout and Swing Stock Ideas

      By Stocks4life · Posted

      DELL Dell Technologies stock, good day moving higher off the 90.99 double support area, from Stocks to Watch at https://stockconsultant.com/?DELL
    • Stocks4life
      Breakout and Swing Stock Ideas

      By Stocks4life · Posted

      MCK Mckesson stock, nice trend and continuation breakout at https://stockconsultant.com/?MCK
    • barako
      LMFX Broker Discussion

      By barako · Posted

      lmfx just officially launched their own LMGX token, Im planning to grab a couple of hundred and maybe have the option to stake them. 
    • HFblogNews
      HFMarkets (hfm.com): Market analysis services.

      By HFblogNews · Posted

      Date: 2nd April 2025.   Market on Edge: Tariff Announcement and Volatility Ahead!   The US economic and employment data continues to deteriorate with the job vacancies figures dropping to a 5-month low. In addition to this, the IMS Manufacturing PMI also fell below expectations. However, both the US Dollar and Gold declined simultaneously following the release of the two figures, an uncommon occurrence in the market. Traders expect a key factor to be today’s ‘liberation day’ where the US will impose tariffs on imports. USDJPY - Traders Await Tariff Confirmation! Traders looking to determine how the USDJPY will look today will find it difficult to determine until the US confirms its tariff plan. Today is the day when Trump previously stated he would finalize and announce his tariff plan. The administration has not yet released the policy, but investors expect it to be the most expansionary in a century. President Trump is due to speak at 20:00 GMT. On HFM's Calendar the speech is stated as "US Liberation Day Tariff Announcement". Currently, analysts are expecting Trump’s Tariff Plan to impose tariffs on the EU, chips and pharmaceuticals later today as well as reciprocal tariffs. Economists have a good idea of how these tariffs may take effect, but reciprocal tariffs are still unspecified. In addition to this, 25% tariffs on the car industry will start tomorrow. The tariffs on the foreign cars industry are a factor which will particularly impact Japan. Although, traders should note that this is what is expected and is not yet finalised. Last week, President Trump stated that he would implement retaliatory tariffs but allow exemptions for certain US trade partners. Treasury Secretary Mr Bessent and National Economic Council Director Mr Hassett suggested that the restrictions would primarily target 15 countries responsible for the bulk of the US trade deficit. However, yesterday, Trump contradicted these statements, asserting that additional duties would be imposed on any country that has implemented similar measures against US products. The day’s volatility will depend on which route the US administration takes. The harshness of the policy will influence both the Japanese Yen as well as the US Dollar.   USDJPY 5-Minute Chart   US Economic and Employment Data The JOLT Job Vacancies figure fell below expectations and is lower than the previous month’s figure. The JOLT Job Vacancies read 7.57 million whereas the average of the past 6 months is 7.78 million. The ISM Manufacturing Index also fell below the key level of 50.00 and was 5 points lower than what analysts were expecting. The data is negative for the US Dollar, particularly as the latest release applies more pressure on the Federal Reserve to cut interest rates. However, this is unlikely to happen if the trade policy ignites higher and stickier inflation. In the Bank of Japan’s Governor's latest speech, Mr Ueda said that the tariffs are likely to trigger higher inflation. USDJPY Technical Analysis Currently, the Japanese Yen Index is the worst performing of the day while the US Dollar Index is more or less unchanged. However, this is something traders will continue to monitor as the EU session starts. In the 2-hour timeframe, the USDJPY is trading at the neutral level below the 75-bar EMA and 100-bar SMA. The RSI and MACD is also at the neutral level meaning traders should be open to price movements in either direction. On the smaller timeframes, such as the 5-minute timeframe, there is a slight bias towards a bullish outcome. However, this is only likely if the latest bearish swing does not drop below the 200-Bar SMA.     The key resistant level can be seen at 150.262 and the support level at 149.115. Breakout levels are at 149.988 and 149.674. Key Takeaway Points: Job vacancies hit a five-month low, and the ISM Manufacturing PMI missed expectations, adding pressure on the Federal Reserve regarding interest rate decisions. Traders await confirmation on Trump’s tariff policy, which is expected to impact the EU, chips, pharmaceuticals, and foreign car industries. The severity of the tariffs will influence both the JPY and the USD, with traders waiting for final policy details. The Japanese Yen Index is the worst index of the day while the US Dollar Index is unchanged. Always trade with strict risk management. Your capital is the single most important aspect of your trading business.   Please note that times displayed based on local time zone and are from time of writing this report.   Click HERE to access the full HFM Economic calendar.   Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!   Click HERE to READ more Market news.   Michalis Efthymiou HFMarkets   Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.

  I accept