Forex 'Trading the News "strategy - a strategy for which I traded for some time at the beginning of his career, the trader and which gave at the time very, very good devidendy, and although this strategy is not invented by me, but was adapted to the market in order time (it was 5.3 years).
Frankly, I did not want to publish this strategy, since the whether it will work now, I do not know ... He had made the post because many traders are always asking me, "How to sell on the news", "What's the news give a good impulse?", "Do you have a trading strategy on the news?", etc. And also, some argue that trading in the forex and importantly earnings know do not need anything - you can simply trade on the news and everything will be OK ... But unfortunately Most of of these trades, or "penny" accounts or demo accounts .
Here is one example of the news on GBPUSD (M1 interval):
That is why, knowing how interested in this topic for many traders, I decided to publish it, and a little restrain the ardor of many "dreamers" of the forex market.
In this strategy, you will not find advice on opening deals, I'll tell you how to trade personally, I and a few of my friends traders as earned with minimal risk and why this strategy ceased to give a good profit.
Although at the moment this strategy is simply gorgeous to work on a demo account any and will periodically give a large number of trades, but in real life - not sure ...
And so the essence of forex strategy "Trading the News":
1) All the news trade is not necessary, there is a certain number of news that give a very good start, ie, momentum and opened with a gap, or the price is rapidly moving in the same direction. Suitable only news outlet with which the price in most cases, namely 50% or better and 70% moves in one direction for at least 2-3 minimum indentation distance from the price (permitted by your forex broker).
Here is a list of news (I must say that this list is constantly changing - some news work today, tomorrow, etc.) - in any case it is a list of news for which you need to pay attention to:
UK
Retail prices
BoE meeting minutes
Retail sales
GDP
BoE meeting announcement
PPI
Trade in goods
ILO Jobless rate
BoE quarterly inflation report
Germany
ZEW economic expectations index
IFO business climate index
ECB meeting announcement (very rarely have a reaction)
ECB press conference
Canada
BOC meeting announcement
CPI
Retail sales
Employment
USA
PPI
Retail sales
Existing home sales
New home sales
ADP employment
ISM
Nonfarm payrolls
Export / Import
CPI
FOMC meeting announcement
Australia
RBA meeting announcement
Unemployment rate
New Zealand
Ads in interest rates
unemployment
2) When the output of news in America - mostly choose a currency pair GBPUSD, as well as the USDJPY (gives a good boost to the news if the pound-dollar has already made several erratic movements up and down at a distance of more than 10-20 points, or go in the same direction and the dollar-ene is at the same time). Well, or at the very important news - EURUSD, USDCHF.
With the publication of news on the GBPUSD, EURUSD - certainly trade the currency pair of the country, on which news outlets.
When exiting news for Canada, Australia, New Zealand - choose the currency pair that country associated with the US dollar: AUDUSD, NZDUSD, USDCAD
When exiting news on USDJPY, USDCHF, I personally did not trade because a lot of sense in these news were not.
3) Every week you print yourself calendar forex news and note that news, which will trade.
4) After that, all you have to do is go to the computer for 10-5 minutes before the news publication, as well as compare notes, that they go well and you understand what is happening in the market - there is a reaction to the publication of the news or not.
5) Assume that news outlets Retail Sales for the currency pair GBPUSD at 8.30 GMT. You come to the MT4 trading terminal, we watched what was going on in the market and choose the interval M1 GBPUSD. If the price for this currency pair is in place - very good - it's 70-80% of the cases a sign that after the publication of the news market "explode" in some of the parties.
Although good news outlets are only intermittently, rather than continuously - that's a fact! Those. 1-2-3 month of news work out just fine, medium 1-2 months, 1-2 months and then the market can not respond even to very important news. Then again, good yields and so on.
Very good news impulses given by those who did not expect Most of traders, such as an unexpected decrease in the discount rate by 0.5 basis points, and expected that the rate will not change. When the price of such changes took place (before) 100-200 points without stopping, and accordingly, if you are in the market in the right direction, then pick up your 1000-1500 pips immediately !!!
6) Because news for the pound, then we are putting 2 pending orders breakdown (Buy Stop and Sell Stop) on the current prices on 5-10-15 points (all depends on the fluctuations in the price and the time for which you set the order). If you set the order of 20-30 seconds before the news (the main thing is not to miss), the news is important, and price fluctuations almost stopped, you can safely put it at a distance of 5-8 points from the price.
The volume of transactions is governed by the importance of the news and its reaction, ie, if the news is stable and well - trading the maximum possible amount, if the news is weak, but gives all the same impulse sometimes - put the average or the minimum lot.
For these purposes, I personally use a trailing stop of 1 item (just a perfect adviser for this strategy, and in general to trade on the news, it is then I applied it for other purposes) - works fast and puts in a few seconds the pending orders with the specified parameters (stop -loss, take profit and trailing stop or transposition to zero).
