Trading the news - What to avoid, what to know, and how to trade with it
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    Trader Yayami's Avatar
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    Trading the news - What to avoid, what to know, and how to trade with it

    dear fellow members of forum,

    in this opportunity i'd like to share some trading tips for you according to my little experiences. this might be useful for traders who seek for market truth and i'm so sorry if this topic may not appropriate for experts because this actually intended for beginners to advanced struggling traders. hereby i'd like to receive all the critics about this thread later.

    description

    in forex trading, we often read about news trading. what's that all about anyway? briefly, news trading means we're trading by reading news information and gather all data to get the conclusions later. many traders specially those who believe in news, they take news as long term cause which move the market. but remember, understanding this fundamental analysis isn't as easy as it looks.

    what to avoid?

    1. other people's thoughts on any forum discussion. believe in our own analysis and understanding.
    2. many opinions from experts about news could be a trap, exercise caution and don't believe them easily without self-analysis.
    3. only take high impact news for better volatility which usually indicated in red on many news calendar.
    4. avoid news trading if you're not certainly sure about what you read.
    5. only trade when you sure the market become dovish or either hawkish.
    6. don't gamble with news with random trades.
    7. avoid using indicators because they may not work properly during the news release.


    what to know?

    1. news is full of surprise and may cause instant movement within seconds.
    2. it's hard to take orders during news release due to market highest volatility.
    3. pending order works fine but sometime it may costs us some missing pips of opportunity.
    4. the rule of "history repeats itself" isn't always happening with news trading so be careful.
    5. always pay attention to current currencies growth and weakness.
    6. focus in long term progress, not in shorter term.
    7. take times to understand about the same news with its different movements yet the same result.


    how to trade the news?

    1. choose which news we want to trade. example, i want to trade with today's official bank rate of gbp. i use the calendar of forex factory.


    2. analyze the previous result and make some reviews about couple releases back. and don't forget to read another related information below.


    3. make some comparisons between previous releases. gather the ideas later.



    4. look at current price movement, mark the release hour to ease our trading.


    5. later when the time comes, set pending order with buy stop and sell stop 20 pips away from current market price.


    6. let the market runs for you and you can either set the take profits based on your money management or cut the trades later directly by yourself. it's up to us.


    notes:
    1. practice this method many times and experience many news trading in demo first before using it on real market.
    2. stop loss amount may vary and try to set it along with the pending order. try to set the stop loss amount by risking 20 pips only.
    3. never trade the news without stop loss.
    4. i don't explain about how to place the stop loss because i think everyone already aware about the risk of trading. anyway, i also wrote it on my 2nd point above.
    5. stay patience because the reward may be greater good with only by risking only 20 pips.

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  2. #2
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    Quote Originally Posted by Yayami View Post
    2. many opinions from experts about news could be a trap, exercise caution and don't believe them easily without self-analysis.
    Though my trading hand is yet to be that strong but in all we do, this advice will always be valid, because come to think of it, we have to trade and follow the market the way we have learned it. However the news trading is not what I will engage with because the demo experience of something similar was not really giving me that much as expected earning.

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    Trader Yayami's Avatar
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    Quote Originally Posted by Real View Post
    Though my trading hand is yet to be that strong but in all we do, this advice will always be valid, because come to think of it, we have to trade and follow the market the way we have learned it. However the news trading is not what I will engage with because the demo experience of something similar was not really giving me that much as expected earning.
    first thing to say is thank you my friend for giving my thread a thumb, hope this gives you some useful information. trading the news is basically a good idea to make huge profits within short period of time. and according to my 2nd point above in my first post, it's bit thrilling to do for news trading to listen to the critics and opinion from what so called analyst about market. we must not believe them easily since they're human too, they could be wrong and never stays correct.

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    Quote Originally Posted by Yayami View Post
    first thing to say is thank you my friend for giving my thread a thumb, hope this gives you some useful information. trading the news is basically a good idea to make huge profits within short period of time. and according to my 2nd point above in my first post, it's bit thrilling to do for news trading to listen to the critics and opinion from what so called analyst about market. we must not believe them easily since they're human too, they could be wrong and never stays correct.
    really this is good thread which should be known well by traders who want to be a real trader, and especially to trigger us to always believe ourselves and open mind to increase the knowledge and skill for better trading in the future
    i combine technical analysis with fundamental analysis where the news become the best way to validate my trading ideas, i have similar points with yours above and that makes me feel better to decide at thing during at the market

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    Quote Originally Posted by mr.big View Post
    really this is good thread which should be known well by traders who want to be a real trader, and especially to trigger us to always believe ourselves and open mind to increase the knowledge and skill for better trading in the future
    i combine technical analysis with fundamental analysis where the news become the best way to validate my trading ideas, i have similar points with yours above and that makes me feel better to decide at thing during at the market
    It gives much insight on how to succeed with the news trading and those who fancy such trading method could try put it to practice on the demo account to see if the result will be good. I personally have tried a lot of news trading method and I never got a good result but my technical trading method now works fine for me and I will be sticking to it more often now.

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    Quote Originally Posted by Striker$ View Post
    It gives much insight on how to succeed with the news trading and those who fancy such trading method could try put it to practice on the demo account to see if the result will be good. I personally have tried a lot of news trading method and I never got a good result but my technical trading method now works fine for me and I will be sticking to it more often now.
    thank you very much for feedback my friend, this is really good input for me and others too where actually we only need to know for what we are doing, there are several trading methods and may one of them is good for us, and so if feel not good with news for trading and there will be always the solution to keep trading with technical analysis and even many of them had already made the success too
    for me, the ideas to combine technical analysis with fundamental analysis just to get good accuracy, know the market condition then decision is made with low mistakes and it means we have more chances to book the profit.

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    Trader Yayami's Avatar
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    Quote Originally Posted by Real View Post
    Though my trading hand is yet to be that strong but in all we do, this advice will always be valid, because come to think of it, we have to trade and follow the market the way we have learned it. However the news trading is not what I will engage with because the demo experience of something similar was not really giving me that much as expected earning.
    always believe in our own analysis and never listen to those experts says about market through their opinions and analysis. since all of us may be wrong in analyzing market, and so the same rules applies to them as well. being an expert about some businesses and jobs doesn't mean we'll become a perfect person who really good at it. there'll be times when we make mistakes too and it's obvious to know as fact.

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    Quote Originally Posted by Real View Post
    Though my trading hand is yet to be that strong but in all we do, this advice will always be valid, because come to think of it, we have to trade and follow the market the way we have learned it. However the news trading is not what I will engage with because the demo experience of something similar was not really giving me that much as expected earning.
    You are absolutely right brother we have to follow the market the way we have learned it. I always believe that news trading is a very dangerous trading strategy but sometimes it's very profitable . News trading is not suitable for newbie trader . News trading is totally prohibited for those trader who don't understand the news.

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    Seriously I try to avoid news trading because the uncertainty is too much especially on a very high impact news. Sometimes you could think that the data information you have about an event will make you eventually take the right trading decisions but you end up still loosing out when it's wrong. The truth is that news can make us lots of profits and can also cause us to loose big too. We have to be very careful if you decide to trade them and know that there is every uncertainty in trading news.

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  10. #10
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    Quote Originally Posted by Sixteen View Post
    Seriously I try to avoid news trading because the uncertainty is too much especially on a very high impact news. Sometimes you could think that the data information you have about an event will make you eventually take the right trading decisions but you end up still loosing out when it's wrong. The truth is that news can make us lots of profits and can also cause us to loose big too. We have to be very careful if you decide to trade them and know that there is every uncertainty in trading news.
    You are right about that and same reason why I try to avoid it as well, I don't want to be caught up in that uncertainty and have it make me loss my money. It is better to focus on the technical trading method that gives more certain view of the market than to follow the trading method of news trading, when you are not a good economist student.

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