Mase_00_7
Education

How to Trade the News

FX:USDCAD   U.S. Dollar / Canadian Dollar
How to Trade the News

We see lots of new traders in the chat here on Trading View making poor decisions around news based trading. Yes, catching a big move can be profitable, but it is a gamble and one that we as money managers should not be willing to take.

Ask yourself this, if you had $1m of client money at stake, would you bet on the direction of a short term news spike?

A much better way of trading the news is to let the market tell you which direction you should trade, then trade off of a Fibonacci level or a retest of structure.

  • Wait for the initial move to give you direction
  • Place a Fib study from the swing high to swing low
  • Wait for price to retrace into fib/structure level
  • Place your entry and stop loss accordingly

A few recent examples of our trading method can be found below:

EURUSD: Two orders opened. the first was opened 2 pips above the 38.2% Fibonacci retracement , and the second was opened 2 pips above the 61.8% Fibonacci retracement .


USDCAD: Two orders placed, one at the 38.2% Fib and 1 at the 61.8% Fib, however only 1 got filled.

Comment: GBPUSD News Trade after CPI on Tuesday 12th September:

Comment: USDCAD News Trade - 2 positions open and both in great profit. Now managing this trade:

This is a great post man. The key, however for pulling these kinds of trades off is patience. Something I lack sometimes.
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