News Trading

Many know that the important economic news may move Forex market up to 100pips and more in one go.  During such a huge move there is an opportunity to make a good profit - fast and easy. But it might not be as simple as it seems, anything can happen during the news release.

Here I'll explain some strategies I use to trade News releases.

1. There are many different important news you can trade, but the main news I always try to catch are (for EUR/USD) - USD Change in Non-farm Payrolls (NFP), EUR European Central Bank Rate Decision (ECB), US Federal Reserve (FOMC).
You can find the release days in any Economic Calendar

Example (dailyfx.com):

NFP


ECB


FOMC

2. NFP and ECB - they releases usually around afternoon:

- as usual I use a channel strategy: I look for a channel and draw it before 04 - 06 am GMT, place the orders buy/sell 20 pips up and 20 pips down from the top and the bottom of the channel, stop loss - 30 pips. Usually I do not place the Profit, sometimes I do but I always analyze the market and use Fibonacci levels to find the exit points. 

The best way is to watch the market during News release, if the market moves too fast your orders might not work in time, so you have to control and do it manually if necessary.

So, after news release if I'm in the trade and market moves in my favor I always try to close some positions and move stop loss to a safer position or place a trailing stop.

Also, if the market moves in the morning and take me in the trade before news and continue move in my favor I try to close some positions again and move stop loss; and if I can see another channel just before news release (like I explained below) I can place additional orders.

- If there is no channel in the morning I use 5 minutes chart and try to draw channel 15 - 10 minutes before News Release and place the orders as usual.

- If there is no channel at all, I place the orders from the current price just 5 minutes before News Release.

3. FOMC - evening news and I only look for the channel on 5 minutes chart and try to draw channel 15 - 10 minutes before News Release (if no channel I use current price ) and place the orders as usual.

Example 1: There was a channel in the morning, market moved 40 pips up in our favor. You could choose the way to exit - first is safer - you could close few positions and the rest leave to continue move up to the level 138 or 161 (Fibo) changing the stop or more riskier - you could just wait and close all position at the level 138 or 161. 

Morning news

Example 2: There was a channel in the morning, market moved and took us in the trade (Line 1) before news release, so we could already close few positions, move the sop loss to a break even (Line 1) and before news release we could draw another channel and place additional orders. So we already have some profit and ready for a second wave (Line 2) even if the market would reverse the first trade would of been safe.  

So here, after News Release we could close again few positions from our second trade after market moved around 30 pips, move stop and leave the rest (plus the rest from first trade) moving down to level 138...


Morning channel plus Afternoon channel news

Example3: Evening news - 5 minutes chart, here is the channel before News Release and same strategy - entry 20 pips down and exit using Fibonacci levels.

Evening news

4. Before trading News you need to analyze the situation and what the market is focusing on at the moment, depending on the current state of the economy, the importance of different news releases changes. One month same news release could be very important in the other month not at all. Also some press conferences could be very important. There are many Forex sites provide information on what is market usually focusing on during the week, I always use them.

Example: ECB rate decision (12:45 GMT) according to the experts was not going to change and the market was focusing on press conference at 13:30 instead.


Conference ECB

5. Usually, if the market before News Release is very quiet the move after will be very strong.

Example: Three days market was very slow, no jumps, only 40 pips between the highest and the lowest price. The result - news release moved the market up to 200 pips.

Quiet market

6. Usually, if there are two important news one after another and if the first was big the second probably will be weak, so it's better to avoid trading the second news or trade it carefully.

Example: First news release was around 100 pips, second was only 50 pips.

ECB_NFP

7. If the trend is very strong and News Release is expected to continue the trend I do not always place the second order.

8. Usually, main and big movement happens in first 5 minutes after News Release, if the market did not move, I would cancel all orders. If I have 2 orders I would cancel one if the other one is in good trade.

And if after News release one trade is loosing I would keep the other one and hope that the market reverse and with the next trade I would try to cover the loss and hopefully make some profit.

So, I usually trade News Releases for few minutes, but it is possible to stay in a trade for longer, the effect can lasts for few hours and days. The strategy would be the same, but you might need to look at 1H charts and change the size of the stop. You can also use it on other pairs, but anyway, always test it first.

In video my results of News trading - 300 pips, September - beginning of November 2014, it does not mean that you will get the same result, the market is changing and I don't know what it will bring me in the next months of trading. Do not forget about all the risks of Forex trading especially on News Releases.



All My Forex Articles:

How I use Fibonacci Retracemnet

How I trade Forex News

Forex System Triangle

No Signals No Indicators System

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Comments / Комментарии

Posted by Panatz on
Hi, Janna thanks you for sharing your idea and knowledge of forex trading. May I know what is the name of your "little" Expert Advisor? It look promising on your trading... If you are willing to share that It would be great.

Thanks
Posted by Janna FX on
---------------- Panatz -------------------

Hi, possibly, it will be a link to that EA soon, waiting for the conditions from the person who sent it to me,
Posted by jack002 on
Hi Janna. Just registered with your blog site today. I am Jack, Laserbeam002 on Youtube. Bare with me a minute and let me tell you what happened to me. Last week, April 6th to 9th I made over $1400 USD in Forex. That was 4 days of trading. Then on Friday I had a bad day. It was a NEWS days. Then on the following Monday another bad day. I lost almost half of the $1400 I had earned the previous week. I think I know what I was doing wrong. I was going to a lot of Forex sites and reading all the post. One would say this and another would say something else and it got me really confused. I wasn't sure which way to place my trades. So my question for you is, "Do you try to keep up with all the economic news or just the economic calendar"? I mean...when I read "U.S. FEB NET OFFICIAL CAPITAL FLOW +11.3 BLN DLRS VS +27.6 BLN IN JAN" I have no idea what that means or what affect that will have on the EUR/USD...etc. Also, I think I was going for greater profit and running too much risk for my lack of experience. Anyway, I am really enjoying trading and learning about trading and I appreciate your post. Take care.
Posted by vijesh on
Hi Janna,
Could you please send me the link of your little expert EA.???If you can share it will be great,
thanks
Posted by Janna FX on
---------------------- jack002 -----------------------------------
Hi Jack,

Mostly I trade the same news events from the Economic calendar (as you can find in this article), I do read what the experts say but usually it just helps with a decision to place the orders or not, target a bigger profit or not..., but whatever the experts say whatever the prediction is, it is always never guaranteed so you must be always careful and do not risk more, then usual.
So you made some profit, and the biggest mistake many traders do - they think it will always be that way and starting to place bigger lots and finally lose, so you just did the same thing, but you've learnt now, that you should not do that :) This is why you might notice, that I do not trade more than 1 lot and only in some cases 2 lots and do not chase big moves :)
Posted by Janna FX on
-------------------------------- vijesh ------------------------------------

Hi, there is no link for the EA yet, but hopefully it will be available soon :)
Posted by chakspin on
Hi Janna,
How do you make money traveling; I want to do the same and travel the world.
Sincerely
Chak Espino
Posted by jack002 on
Hi Janna. I have you are having good luck with your trades. I am being more careful with placing trades now and I am not going for really big profits. Surprisingly I am more profitable because I am having fewer losses. As of today I have more than doubled my initial capital, that is, the money I set up my trading account with. I can not draw some out as payment to myself. I wanted to tell you this. Several months ago I was looking for something to do on my own to earn money outside of my job. Well, I happened to run across your video where you talk about forex. I think you were in Hawaii. Anyway, I became curious and started to investigate the forex market and It looked like something I wanted to try. I am really glad I did and I am thankful to you for posting that video and all the others. You and your videos have really been a great help even though I don't trade your style. I wish you and your husband the very best. Take care and please keep posting. JACK
Posted by jack002 on
ooops...I meant I AM NOW ABLE to draw some out as payment to myself. I guess I need to proof read my post. Sorry.
Posted by jfantonial on
Hi Janna,

how are you?
just wondering as to what you've said these news have big changes/impacts on the market.

NFP
ECB
FOMC

but I noticed for example, on your video the non farm payroll firstly shown was Bullish/uptrend and the next NFP was going down bearish/downtrend.

my question is does these news doesnt necessarily have 1 direction/trend on the changes upon news release? whats your indication to know which way it's going, up or down. I've been confused for a while with these ones.

*I'm also using tallinex broker and have been inspired by your videos & strategies to trading, very big help. thanks!


cheers,
Jason
Posted by Janna FX on
----------------------------- jack002 ---------------------------------------

Hi JACK,

Thank you too :) It's wonderful to know that Forex is working for you, all the best and good luck with trading!!!
Posted by Janna FX on
-------------------------- jfantonial --------------------------------------------
Hi Jason,

Yes, those are the most important news, which though sometimes could be not, depends on the situation on the market, also other news or reports can become more important than usual.

I don't usually know where the market would move during the news release unless it was something obvious which happens very rear, so that is why I place 2 orders and hope that the market would move just one direction, does not matter which, as long as it would move a lot, but sometimes it can move one way and than the other, taking us into one trade, making a loss (if it did not move enough) and then into another, usually with the profit. So, you have to be careful during the news releases and do not risk much, as you might have to take a loss before making a profit.
Posted by Nicholas on
Hi Janna, thanks for all yr videos on YouTube....
Last time i sow a video how to trade the news... But here whats happend.... I did a peding order before the news with 20pips up and don, with 30SL pips. But at the time the pair has a super hight volatilitie and broke the candle anddd my stop loss dosent work and i lost all my account fund, is that possible or can happend??... Im having i really bad time with my broker..
I really aprecitte if u can answer me

Tks!
Posted by Janna FX on
---------------------------- Nicholas ----------------------------

Hi there, you are welcome :)

During the news anything can happen, so it's possible that the orders did not work.
Posted by 072809henry on
HI YANNA I WANT TO COME TO YOUR AREA TO TEACH ME MORE AND I WANT YOU TO BE MY MOTHER.
Posted by jason88 on
Hi Janna, Thanks for your good video to share experience.
I am new to fx and want to learn from you.
Can I follow you when you open a trade I can follow you at same time
open a same trade, I learn it from internet called copy trades
mt4 has the function.

Thanks

Jason cai
Posted by jack002 on
Hi Janna. About your EA I too am using a Buy stop/Sell stop EA but it is a bit clumsy to use. Are you allowed to share the EA you are using? Thank you.

Jack
Posted by Janna FX on
------------------- jack002 --------------------

Hi, I still can not make an agreement about an EA with a programmer, he is not responding very often, but I hope we still will figure out something at one point...
Posted by jack002 on
OH well, no problem. I appreciate you trying anyway. Thank you.
Jack
Posted by victor on
Hi Janna,

I always followed your videos. It's very enlightening. Thanks for sharing with the rest of us.

When you read what the experts say, do you consult any source in particular that you think is more reliable than the others?

I wish you have a very good year

Thanks
Posted by Heitch on
Hi Jann, can you give me the addresses of those forex sites provide information on what is market usually focusing on before a news release
Posted by Janna FX on
--------------------- victor ----------------------------

Hi, thank you, I usually read just what experts say about upcoming news, from different sources, I do not know which is more reliable or not, as I still trade using my own strategies.

----------------------- Heitch ------------------------

Hi, I use dailyfx.com Economic calendar.
Posted by jack002 on
HI Janna. Have you started back trading this year? I have been trading some this January. It seems there has not been the usual activity but I was expecting that. Still, I have made some very good trades. I look forward to any new videos you post. Take care.

Jack (Laserbeam 002)
Posted by jack002 on
OH Yeah...I have a question for you. A few days ago I placed a buy stop order on the (bought) Gpb/Jpy pair. A little while later I checked to see how it was doing and my order was hit. The odd thing was the wick had not touched the dotted green line where my order was placed. I zoomed in and it looked as though the tip of the wick was about three to five pips below the line but yet I was IN the trade. I was wondering if you had any ideas why/how that happened? It's really no big deal. The trade worked out well for me anyway. Just curious is all.

Jack (laserbeam 002)
Posted by Janna FX on
---------------------------- jack002 ------------------------------

Hi Jack,

I've started trading now, yes, also I'm testing some new EAs. I hope to find some time to make some new videos :)

Glad you are making good trades, as for that one, it probably was spread.

Happy trading :)

Jan
Posted by jack002 on
Thank you for responding. I will look forward to your new videos. As for that odd trade, Yeah I assumed the spread increased and that is what took my into the trade. I usually don't like that but what can you do? Nothing really. Anyway, take care. Wish you and your husband the best.
Posted by kayree on
Hi Jan
I am sukhairi from Malaysia. Actually what time you draw the channel for Malaysian time. Just for information if malaysian time is 9pm USA time is about 8 am in the morning.

Appreciate if you could teach me to become a good trader

Thanks and best regards

Sukhairi
Posted by jack002 on
Hi Janna. I was just wondering about your thinking regarding the different time-frames to trade. I know you only trade the 15 minute chart. Is there a specific reason you stick with the 15 minute chart? I have heard other traders say the lower time-frames have too much noise. In your opinion is the lower time-frames better for day trading? I have been using the 1 hour chart but I have notice I missed some very good trades on the 15 minute chart by waiting for those move to show up on the 1 hour chart. Anyway, I appreciate your opinions. Thank you.
Jack (laserbeam 002)
Posted by Janna FX on
----------------------- kayree ----------------------

Hi Sukhairi,

Usually I look for a channel before Europe/London sessions open so before 5-6 am GMT, for Malaysia I believe it should be around 1pm.
Posted by Janna FX on
------------------------ jack002 ---------------------

Hi Jack,

well, I do look at different time-frames, as I always try to identify the trend and looking for patterns. If you would run a trade for few days and may be weeks, yes, you would look on a larger time-frames, and possibly catch a good long-lasting movement, but if you only look for a quick trade (scalping) then 15 min chart is good, lower is too risky, higher is too much for a day trading, just as you mentioned, you will probably miss a good trade.
Posted by jack002 on
As always thank you for your reply.
Posted by JFreedom on
I just tried to use this method to trade the NFP this morning and my order was his 27 pips from where I placed it. That means there was TWENTY-SEVEN pips of slippage even though I placed the order with a requirement of only 3 pips slippage. Have you had similar experiences in fast moving markets?

Because of the slippage I experienced a total loss when there should have been profit.

By the way, thanks for all your great work here.
Posted by Janna FX on
------------------- JFreedom ------------------------

Hi, during News anything can happen, if you use true ECN broker slippage requirement will not work, because you trade against real market, broker does not control it...

Which method did you use? It is always better if there is a consolidation (channel) before Important News release you should be careful and analyze previous day (days) and if the market actually waiting for that news release...
Posted by mj4ever on
hi janna
i was watching your videos quite a few days and i noticed that you're using a EA for your trades i appreciate that if you explain a little bit about this particular EA and what is its name and how can we download or purchase it.
thank you for all of your good videos
Posted by Racoon74 on
Hello Janna,
I have seen on you video you are using a small EA for setting The Buy Or Stop loss. Where is it possible to find it. It would be appreciated.

Thanks for your answer and thank you for sharing with you time and energy.

All the best
Posted by JFreedom on
Hi Janna,
Thanks for all your help with trading. I consider you my trading 'guru'.

I have a problem with Tallinex on news trading. So far I have made 4 trades with them on news releases I have have had NINE (9) PIPS of slippage on every one of those trades, leaving me with only about 1 PIP of profit. When looking at your trades I have never seen ANY slippage. Have you had a similar experience with slippage?

I got that again today with Nonfarm Payroll.

Thanks,
Jim
Posted by paulh on
hi

I think you couldn't be profitable with this strategy on long run. This is my opinion. I am trading only on big deviation: https://youtu.be/FrH_P6j8NAc

thanks anyway
Posted by pardongukutu92 on
Hi Janna

Thank you a lot. I am still watching your videos and your strategies.

Is your strategies on nwews trading still work, because I can see you posted them some years ago?
Posted by Williams on
Hi Janna,How do i assess your news trading soft ware?
Thanks in advance
Posted by Dylber on
Hello, Janna, How are you? My name is Dylber and my question is how to start trading with 50Euro, and profit minimal 5 and 10 Euro, Thank for understading, I have nice day for you,
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