[ad_1]

Forex System based on trading news demands careful selection. The trading session’s most explosive time is during any fundamental announcement or news. In a matter of seconds, the market can move hundreds of pips. Therefore, the risks associated with trading news outweigh those of trading using technical analysis.

Despite the risks involved, the profit potential of trading during forex news announcements is highly tempting for traders. When choosing a forex news-based system, it is crucial to ensure that it addresses the following three risks.

First, it is essential to have a strategy in place to protect your forex account when the market moves against your trade direction. The unpredictability of forex news makes it impossible to anticipate its movement. Without a strong protective strategy, your entire account is at significant risk.

Second, it is crucial to determine the profit target. Forex market reactions to fundamental news are based on “Expectation.” For instance, if the trader community expects an increase in unemployment from 6% to 8% during the next Non Farm Payrolls announcement, but the actual result is 7.9%, the market will perceive this as positive for the US economy. Consequently, the dollar will strengthen, and the market will move in the USD direction. The forex news trading system should specify a realistic profit target based on the news results.

Lastly, the cooperation of your forex broker is paramount. No forex news system will work if your broker cannot provide live prices during fundamental announcements. Some forex brokers delay currency pair prices during volatile announcements as they discourage trading news. If this is the case, you can either abandon the idea of trading forex news or opt for a new broker.

[ad_2]

Ihab Salloum