How To Trade FOMC news
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Thread: How To Trade FOMC news

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    How To Trade FOMC news

    I want to give us a clue about how to trade the Federal Open Market Committee news, this has been dubbed the Father of Margin Call by some traders because of the amount of losses and drawdown people experience whenever this news is released, I have found a way around this losses and trading it profitably, I am going to tell is our experience being that I have gotten many margin call from trading this news as well.

    From what I have observed for quite some time now, the FOMC always brings some volatility which is usually makes the market to be hyperactive, we can take trades even with this unpredictable movements,but there is a way we can do this, first thing is to establish the trend that is already on place before the news announcement, this is very important because this news always respect the technical analysis prior to its release, don't ignore this aspect.
    The second thing would be to map out the different support and resistance levels so that you can know exactly where to pull the trigger, after that has been done, wait for the news with your charts opened, I always use the 15 Mins to monitor events, then as soon as the news comes out, please wait for a minimum of five minutes, don't jump in immediately because this news always comes with a spike which could wipe your account easily, after about five minutes or more, the price would usually settle into a rhythm of either going up or down, enter the pair you wish to trade and ride the pair till you notice a reversal Taking place, please always make use of money management because this news is dangerous and can destroy your entire account!

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    Thanks for this explanation, of all the news announcements that I fear the most, FOMC stands as number one, yes it is true that many people call it father of margin call, the reason is just because the market responds in a very crazy fashion which can terminate an account without mercy, I will probably try this your formula with a demo account and see how it works before I attempt my live account with it, that news is not friendly at all especially for the people with low account balance.

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    Registered user famousfx's Avatar
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    Te time of the news is a period that traders need to be cautioning themselves, patience is needed in trading the news, we have to wait until the news is released and the result is well interpreted by trader before any trade is placed in the market, because there is always volatility and irrational movement in the market.

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    Registered user Lyon's Avatar
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    Quote Originally Posted by famousfx View Post
    Te time of the news is a period that traders need to be cautioning themselves, patience is needed in trading the news, we have to wait until the news is released and the result is well interpreted by trader before any trade is placed in the market, because there is always volatility and irrational movement in the market.
    From my trading and then knowledge I have gotten so far, when it comes to news trading, I do make sure that I am avoiding the news for I know how the news works and then the forex trading market. News will make the market so much volatile but trust me, you wouldn't be able to know the direction, if you are not careful, you would loss so much. I rather trade on the trend than take on news trading.

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    Quote Originally Posted by Lyon View Post
    From my trading and then knowledge I have gotten so far, when it comes to news trading, I do make sure that I am avoiding the news for I know how the news works and then the forex trading market. News will make the market so much volatile but trust me, you wouldn't be able to know the direction, if you are not careful, you would loss so much. I rather trade on the trend than take on news trading.
    Avoiding the news is probably better for categories of forex traders that don't like taking much risks and blowing up their account unnecessarily but that also means we might miss out from good opportunities which can be really profitable, someone like me don't like to trade when the market is slow, trading news makes more sense to be but I do it with caution.

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    I always read the news and expectations about fomc before releasing of it to see what the big traders and analyzers talk about it, and these expectations are good in many cases because mostly the US government gives an ideal about their plans of the whole year and so it is not hard to predict the fomc results during the year

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    FOMC is one of news that I will advise forex traders to avoid, the explanation given here is okay but I still think that many people might never get the full understanding of how this works, before you can say that you are willing to risk your money into trading the news, I suggest that you have a successful trading experience from the demo account to prevent unusual and unwanted losses which can be really bad.

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    FOMC is one of the most dangerous fundamental news. this news is just like NFP news which is coming every month. I want to share my experience with news trading that the worst news comes from US sector all kind of news which comes from US sector not respect the fundamental news. so I want to say that avoid trade which comes from US sector and follow your strategy.

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    Quote Originally Posted by letsdo View Post
    FOMC is one of the most dangerous fundamental news. this news is just like NFP news which is coming every month. I want to share my experience with news trading that the worst news comes from US sector all kind of news which comes from US sector not respect the fundamental news. so I want to say that avoid trade which comes from US sector and follow your strategy.
    It is dangerous but everything we will ever do as traders is not devoid of dangers or risks, anyone that is not prepared for these kind of risks will never become successful in this market, FOMC is truly dangerous I agree but there is always a way we can go around it if we want to make some money from it, more importantly is our level of patience, that is of course why we need to pull the trigger at the exact right time with some level of precision for safety sake.

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    Quote Originally Posted by Leonvic View Post
    It is dangerous but everything we will ever do as traders is not devoid of dangers or risks, anyone that is not prepared for these kind of risks will never become successful in this market, FOMC is truly dangerous I agree but there is always a way we can go around it if we want to make some money from it, more importantly is our level of patience, that is of course why we need to pull the trigger at the exact right time with some level of precision for safety sake.
    This is strange to me, why would you put your trading account in danger because you want to make money from the forex market, that does not sound appropriate in my understanding, is it not better that you trade a normal market set up where you are sure about your risk commitment and other parameters, the uncertainty that goes with trading this FOMC news is rather too much for some people to bear, but whatever rocks your boat is okay, in forex every one is entitled to what the believe in.

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