To trade news, you have to first look and note the
important things, such as:
1. How strong the impact is.
2. If there is a fake move on that news or not.
3. How your trading experience is.
4. And what your trading strategy is.
If there is not a big difference on a news impact then forecast, than it is not
suggest to trade on that impact. Because it will only give you a spike up or
down (whatever the impact is) and then will turn into the normal trend.
If there is an fake spike in market. For example: If the impact is strong
positive for the pair and the pair is getting weak, then it is also not
suggested to trading on that. Only scalping (fast in fast out) is suggested
here.
If you are trading experience is well enough to manage the news and trade, then
you can be surely add more positions on your scalping, otherwise it’s better to
stay out.
A normal news trading is based on the impact number. Always wait for the news
out coming and don’t enter the market, when you see the first spike (because it
can be a fake spike).
So wait for the numbers and have see the difference and the enter trades.
And if the news supports then trend, then you can surely add more trades on
that.Major news such as interest rates or non-farm payrolls tend
to have high impact on the market. During the release of the data, spread might
get widen and the market is volatile. Likewise, the market can be extremely
volatile and you cannot spot a clear direction. It is hard to tell how long you
should wait after the news, because sometimes their affects linger. I usually
wait till the markets are calm, at least 10-15 minutes after the release, or
till I notice a clear trend.
More importantly is the market now setting up to provide an entry to trade as
per the strategy you follow as per your rules. Or do you need to walk away.You should never try and second guess the impact of KEY news events.Sometimes opening a deal right in the time of a release is
very hard because of regular requotes so it's better to open a position just
before the news. But of course the presence of requotes depends on your broker.You should probably avoid major news days entirely at the
beginning. Maybe do some practice account trading on news days to get a feel
for how the market responds to news, but the market will respond differently in
different situations and different market conditions and different news and
depending how big of a surprise it is and depending on when the release time is
during the day, etc. Best to stay well clear at the beginning until you are a
more experienced trader.
News
is only news for the public like us. News is already old news to those who have
deep pockets to purchase the news before it comes out. Luckily, these big boys
leave marks on the charts that give us pointers as to what they're about to do.
Volume is one of three main pillars in my trading (trending and structure are
the other two).
Volume and structure are marks that the big boys leave on the charts. On a
particular news event, the big boys have already opened their positions
beforehand and are ready to make a killing (over the next two weeks to a few
months). Remember the old 2 for 1 rule. I risk 1 to make 2, but I must make 2,
or else, I won't play. The big boys follow this rule and you can see this
riddled throughout many forex charts, and is especially noticeable on daily
gold charts.
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