The News Can Kill You

Forex markets are pretty predictable, but sometimes things throw a monkey-wrench into that predictability. One of biggest things that can mess with the Forex markets is a major news release.

There’s only one thing you need to remember about major news releases, and that’s not to trade when one is coming up!

Be careful here, because you’ll notice I said major news releases. There are low-impact news releases all the time, and I completely ignore them!

When I say major news releases I mean things like the U.S. Non-Farm Payroll (NFP) report, major economic announcements by the Fed or world leaders, and things like that. What I DON’T mean are all the little news events that happen every day. Yes, I know that a lot of the online Forex calendars mark them as important news events, but they really aren’t.

The only way they would have any significant effect on you is if you were trading really small timeframes, like 5M or 15M charts. If you never trade anything under 4H charts the 10 pip spikes from small news releases will have a minor effect on your trading, but it will even out over time. You might lose a trade because price suddenly dropped 10 pips based on some small news event, but you are just as likely to win a trade (or exceed your profit target) for the same reason!

Over time the light news will help you just as much as it hurts you, so why bother messing with it?

By |2019-10-02T15:22:32-06:00February 14th, 2013|Forex Course|0 Comments