Resource published Thu, Feb 23, 2017 at 01:08PM UTC edited Thu, Feb 23, 2017 at 01:08PM UTC
Three cardinal rules for trading the high impact news release Edit Title
Forex trading is such a lucrative business that every single day the number of a retail traders is increasing at an exponential rate. In the past, forex trading was only limited to the large banks and institutions since it required a high amount of money to trade the live assets in the market. But due to recent technological advancement, all the general people can trade the financial instrument with very little amount of money. But trading the financial instrument successfully requires an extremely level of patience and skills. As a trader, you must execute every single order in the market very perfectly to remain profitable in the forex market. During the event of the high impact news release in the market, the forex market becomes extremely volatile and many new traders tend to trade this volatile condition to make money. But due to their lack of knowledge, they miserably fail when it comes to high impact news trading. In this article, we will discuss three cardinal rules to trade the high impact news release.
Plot the technical parameter: Most of the novice traders have a tendency to trade the high impact news releases based on the published data. But in order to make a decent profit by trading the fundamental news release, you must do the technical analysis. If you look at the professional traders in the fx trading community than you will notice that every single one of them execute high-quality trades in the market based on technical and fundamental news release. Most of the professional price action traders draw the key support and resistance level in the market in their trading platform and tend to trade that level in the event of high impact news release.
Assess the severity of the news release: One of the most common mistakes that every trader makes in news trading is failing to assess the severity of the news release. If you truly want to become a successful news traders than you must know which news release will go to have a high impact on fx trading. The fundamental news release is often considered to be the price driving catalyst in the forex market so if you don’t know how the severity of the news release then it will be extremely hard for you to trade the news. The market moves at a certain pace to a certain distance depending on the fundamental data and as a trader, you should know how to gauge the market movement based on financial data. If you are relatively new in forex trading then it will be a little bit difficult for you but if you are committed to learning the art of news trading than over the period of time you will realize that this is one best trading opportunity for the traders.
Educate yourself: Most of the novice traders in the fx trading community tends to trade the market without having a proper knowledge about the financial industry. If you want to become a profitable news trader than it’s highly imperative for you to know the major three types of analysis in the market. As a trader, you should always remember that the best trades in the market are done when the traders do the technical and fundamental analysis perfectly. So try to master the art of technical analysis since it is extremely important for you to trade the news. Always make sure to draw the technical parameters in the market prior to the news release. As a trader, you should develop a reading habit since it will allow to you to keep yourself up-to-date with the latest happenings of the market.
Summary: Forex trading is not at all easy rather it is one of the most complex business in the market. The market tends to exhibit an extreme level of volatility prior to the high impact news release so if you know how to trade the volatile conditions in the market then it will be extremely easy for you to make a decent profit out of trading the news. When you trade the news in the market make sure you trade in favor of the long-term prevailing trend since it will greatly reduce the risk exposure in the market.
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