NEWS FOREX TRADING (Trading with Forex News)
We do not expound on these trading techniques, but we only discuss a trading technique that we've applied in person for a few years and proven to work well, the technique is a technique Fundamental Analysis by utilizing reading a news Forex Economic Calendar.
We love this fundamental technique, given that most movements in the forex market is driven by the influence of News, and NOT by a technical analysis. You may observe the effect of news on the movement in the market.
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How does the application of this Fundamental techniques?
Before applying this method, then you should have a strong foundation first in Forex, learn forex guidelines essentially first and calculation formulas. Then follow the sequence of steps easy enough below CAREFULLY, namely: (Must Sort!)
- Choose the right broker, and credible. Because this technique requires broker-quality and safe. Because the news is very fast movement and dynamic, so need a good broker.
- Open web information contained forex economic calendar of international (economic calendar), we usually use the comparison of personal information from the 3 sites, namely in: Beritaforex.com, forexfactory.com/calendar.php and dailyfx.com/calendar. 3 Why this site? because these sites sepengalaman we are to have the most accurate value for its analysis than other economists.
- See today's date of each of the economic calendar, and match. (Clock Time is also not wrong! They are the default clock hours New York time in the United States, which is where different about 11-12 hours slower than hours GMT or GMT + 7 in Indonesia). If you misread the clock, then this could be fatal, due to schedule your trading hours could be wrong all the readings. To match with Indonesia pm hours ago timernya comparable with the economic calendar clock in beritaforex.com or by conversion of hours in timeanddate.com
- Look at the news that you want tradekan currency, Example: news UK (united kingdom) is for the currency GBP (GBP / USD), or the American news / US for all pairs related to the USD (GBP / USD, EUR / USD, USD / JPY, USD / CHF, etc). Should avoid currency trade with Cross Rate in the application of this technique.
- Select the news that High Impact course, which is marked with the color red or Marked Seru 3x, according to the currency you want to tradekan it. CAUTION! The minimum in the web 2 must conform High Impact all (red or exclamation 3x), because if not, then do not trade on the news hour. The third best if earlier news web is all conform High.
- Additional Notes: for class news medium or low impact, it can also affect SOMETIMES (though very rarely), depending on the result of the news as well.
- Match High Impact news of the three economic calendar, whether it has the same value Forecast or not. When the value of forecastnya different, in the sense of contradictory, so avoid trade on the news. But if the value forecastnya more or less the same direction (the direction of the directors estimate the same) then allowed to choose the news. (If you want to be forced Trade also be true, it's just usually not optimal, and also all depends also on the outcome of Actualnya later how)
- When in one of the news sites do not include the time or the hour Tentative, or that there is no forecast and previousnya, then you should not trade in the time of the clock.
- Observe column Actual, Forecast and Previousnya (Forecast estimates that means news results, Previous it is the result of the news in the previous period)
- Check also, whether there are other news at the same hour (or adjacent) to the currency, and whether the results forecastnya contradictory or not the news to each other? if the opposite, then please Alert with news that the adjacent winder.
- When all the indicators above check list has been valid all, then wait until the news was announced in the time slot. (You may monitor the news through cable TV services such as broadcast channel Bloomberg, Reuters, or CNBC)
- After the news came out, then Refreshlah the economic calendar in each site to bring its Actual values and compared. (If the result of the news is no value actualnya then do not trade).
- Compare the results Actual vs. Forecast vs. the Previousnya. When the value Actualnya OUT OF THE BOUNDARY BETWEEN Previousnya value Forecast and then allowed to proceed to start trading on the news. (Observe also the revision if any)
- If actualnya better results than forecast and previousnya (marked in green), then typically the value of the currency will be strengthened, as well as vice versa weakened. (REMEMBER no.12 also point above).
- The actual green color that means better, while red means worse than previousnya, but you should pay attention to the points above to decision his order Buy or Sell.
- Check if there are other news (for the currency) in the same hour or adjacent time, which results actualnya conflicting with earlier news? if there is, then do not trade in the first hour, because the movement is likely to be Zig Zag or unexpected. Also VIGILANT with revisions that occur from Previousnya, because it is also very influential (if the revision is not in line with the actual value of the market will likely Zig Zag)
- Valid When it all then you should trade, BUT do not directly Open Position when the news was announced, but wait a few minutes before the OP. Because if you live in the current OP-minute news announced the first movement of the movement often false and deceptive, and besides your order must also be difficult to enter as a result of market factors busy or quota demand / supplynya not available in the market.
- Always Control the Risk Management Money Management or her, because this is the key to your trading success. (Our advice Risk is 3%, or at least max 5%)
- TP and SL should be balanced, or TP is greater than the SL was better. And TP / SL should be above 30 pips to 100 pips, or if the broker is applying the 5 digit, the TP and SL it is above 300 to 1000 pips. (Risk reward should be comparable).
- Do not trade without SL or play lasting hold floating, because of the risk once. Remember always that chance opportunities in the next day is still a lot.
- You may also add trailing stops 20 pips (or 200 pips to broker 5 digits) in applying these techniques.
- Do not use a pending order like Buy Stop / Sell Stop (or trapping techniques or traps) in using this technique, because of the risk for slippage or price fumble. 99% SURE slippage.
- Approaching holidays such as Christmas and New Year's eve (December / January), please be wary true, because in the market is very difficult to predict.
Before applying this technique, we advise you to HAVE to Practise first on a demo account until completely proficient before plunging into the real account. Because the effect of news that is not accustomed can lead to shock, given the often very rapid movement and unpredictable. In addition it also determines your thoughts.
You are also allowed to enter gradually to anticipate the apparent movement, if it is movement in the market contradicts the news, because it is often later the market must turn to follow the news results in the edges.
Do not be careless all the news ditradekan, but wait for the right moment, especially pay attention to the type of news CLASS I like Non-Farm Payroll (NFP), CPI, GDP, Retail Sales, Unemployment, Interest Rate (the interest rate) and the like. But for the news class II as Consumer Confidence, Home Sales, PPI, PMI, Trade Balance, TIC, Durable Goods, Philly Fed, and others also may be considered. (AND SHOULD ALSO marked HIGH IMPACT!)
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