In today forex faq, we have a question from one of our fellow traders asking me the below question
Hi you trade only based on technical analysis. How you are dealing with daily news like nonformpayroll, interest rate decision, various statement of FED chairperson and its member .etc of USA.
If you have been following my forex blog, you will know that I am a pure technical trader who does not look at news at all.
For your above question, my answer is I ignore them.
No doubt, some of the losses I get in my trading are due to news release but there are also times where news release has cause the price to hit my target profit faster.
The main reason why I am a pure technical trader is because it is very hard to trade the news as the movement of the price due to news is sentiment driven and it is near to impossible to anticipate people sentiment.
When a major news is released, some people will think that the news is going to push the price up while there are also a group of people who think that the news is going to push the price down. Therefore where the price moves lies in which sides of the sentiment is more.
If you are very concerned about news release affecting your trade results, then you can get out of those trades you are in before the news is released.
However for me, I simply stick to my trading strategies and will still enter any trades that are according to my strategies. From my experience, the news release only affects a few of my trades per month and therefore do not cause much problem to my trading.
I hope that I have answered your question and do feel free to email me if you have any question