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Thread: How To Trade FOMC news

  1. #1
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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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  2. #21
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    Quote Originally Posted by Lyon View Post
    Well, more easier said than done, I think it would be good if you provide some good trading history of you doing that so that we can see for ourselves and then get to know if that works actually . I have read a lot of reviews even from the professional traders and they say they don't take news directly but they wait for it to make moves, thereafter they trade from the chart appearance.
    The next FOMC date is August 1st 2018, if you are looking for a demonstration I might be able to show you something after I have traded tg news and show you my trading history about how it went, I cannot give you the live details because I I'll be too busy catching the opportunity that I won't be able to immediately update about what I am about to trade.

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  3. #22
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    Quote Originally Posted by Leonvic View Post
    The next FOMC date is August 1st 2018, if you are looking for a demonstration I might be able to show you something after I have traded tg news and show you my trading history about how it went, I cannot give you the live details because I I'll be too busy catching the opportunity that I won't be able to immediately update about what I am about to trade.
    I don't understand, if the next date for FOMC is August 1 does that mean that this news did not happen this month, I thought that it is usually the third Wednesday of the month that it takes place, I really look forward to seeing your trade results about this news being that this entire thread discussion has been based solely about how to trade it profitably, I am curious regarding what will happen that day and scared to even try to take a trade when it happens.

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  4. #23
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    Quote Originally Posted by Ehis View Post
    I don't understand, if the next date for FOMC is August 1 does that mean that this news did not happen this month, I thought that it is usually the third Wednesday of the month that it takes place, I really look forward to seeing your trade results about this news being that this entire thread discussion has been based solely about how to trade it profitably, I am curious regarding what will happen that day and scared to even try to take a trade when it happens.
    I am as surprised as you, because I checked the FOMC news release schedule and saw that there is none for the third Wednesday as you have rightly pointed out, I don't know the explanation for this but one thing is for sure, FOMC is very volatile, maybe the impact is what made them to leave out the usual date to another, I don't have a good explanation for this to be honest.

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  5. #24
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    Quote Originally Posted by Leonvic View Post
    I am as surprised as you, because I checked the FOMC news release schedule and saw that there is none for the third Wednesday as you have rightly pointed out, I don't know the explanation for this but one thing is for sure, FOMC is very volatile, maybe the impact is what made them to leave out the usual date to another, I don't have a good explanation for this to be honest.
    Yes, the volatility is really out of the ordinary so if they even decide to be doing this meeting of theirs once in every three months, I totally believe that it is still okay, some traders are eager and waiting for this type of news while others are not even interested because it might be the announcement that gives them a margin call, its a matter to find different strokes for different folks.

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  6. #25
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    Irrespective of when this news is released, I think traders need to be extra careful with how they trade it, I am not just referring to this news alone but for every other one that has this same characteristics, volatility is very good for every one but when that becomes a speeding train that has left its track, I think that is a looming disaster that will be very catastrophic.

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  7. #26
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    Quote Originally Posted by simisola View Post
    Irrespective of when this news is released, I think traders need to be extra careful with how they trade it, I am not just referring to this news alone but for every other one that has this same characteristics, volatility is very good for every one but when that becomes a speeding train that has left its track, I think that is a looming disaster that will be very catastrophic.
    I couldn't agree less with your opinion, the goal of all traders when there is so much volatility in the forex market is to take it as a responsibility in protecting their accounts, this is not peculiar to news trading alone, traders have lost their account when there is a movement that did not involve any news, maybe it is their greedy intention to make so much from a single market. FOMC is one of those events where we need to be skilled befit we earn from it.

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  8. #27
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    Trade on fundamental factors is so risky and dangerous for our account. so we have to need to stay away from fundamental trading and I also advise you to don't trade on FOMC news this is really bad news who affect badly on news time and also the spread of every US pair is increased so much. Which is not good for us.

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  9. #28
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    Quote Originally Posted by Leonvic View Post
    I couldn't agree less with your opinion, the goal of all traders when there is so much volatility in the forex market is to take it as a responsibility in protecting their accounts, this is not peculiar to news trading alone, traders have lost their account when there is a movement that did not involve any news, maybe it is their greedy intention to make so much from a single market. FOMC is one of those events where we need to be skilled befit we earn from it.
    It has been proven that the news method has traders losing most of their money, therefore to me it will be more better that I don't attempt on trading the news because I know how it works and it is not also profitable. I am a price action trader and I know that trading price action is far more profitable and then we have many more opportunities with each passing day.

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  10. #29
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    Whenever there would be FOMC then I believe that what we should be looking at is the deviation and once the target is hit then we are likely going to get the the price moving in the desired direction. For example whenever they are expecting an increase of 0.25 and there was 0.5 then the dollars would gain weight right away.

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  11. #30
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    Quote Originally Posted by Brain View Post
    It has been proven that the news method has traders losing most of their money, therefore to me it will be more better that I don't attempt on trading the news because I know how it works and it is not also profitable. I am a price action trader and I know that trading price action is far more profitable and then we have many more opportunities with each passing day.
    That is an excellent choice I must say, it is better to take a stand on something that you have limited knowledge instead of dabbling into areas that we don't understand, yes it has been proven that trading news can be counterproductive to the people that don't know its effect or even to interpret it, but with the right exposure that comes from practical experience, earning from any news is possible.

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