92# Forex News Trading System
Submit by Joy22
Step 2: Now, look at the Calendar for News releases that affect the Forex market. The ones particularly to look for are the following news announcements:
1. Unemployment Reports (Non-Farm Payroll)
2. Interest Rates
3. Consumer Price Index (CPI)
4. Inflation Reports
5. Gross Domestic Product (GDP)
6. M2 (Money Supply)
7. Treasury Budget
8. Producer Price Index (PPI)
9. Retail Sales
10. International Trade
Unemployment Reports are released on the first Friday of every month at 8:30 am EST for the prior month (this is a big one you should always attempt to trade!), and every Thursday at 8:30 am EST they release a weekly adjustment (less important but still a good possibility). CPIs are released 8:30 am EST around the 13th of each month for the prior month. International Trade is released 8:30 am EST around the 20th of the month (data is for two months prior).
PPI released around 11th of each month at 8:30 am EST for the prior month. Treasury Budget released 14:00 EST around the 3rd week of the month for the prior month. GDP released 3rd or 4th week of the month at 8:30 am EST for the prior quarter, with subsequent revisions released in the 2nd and 3rd months of the quarter. M2 released Thursdays at 16:30 EST data for the week ended two Mondays prior.
NAPM (National Association of Purchasing Managers) released 10:00 am EST on the first business day of the month for the prior month. Retail Sales released 8:30 am EST around the 13th of the month for one- month prior.
Step 3: Only Trade the following currency pairs as they appear at this time to move more than the others: EUR/USD, GBP/USD, USD/CHF. Do not attempt with real money (just demo) to trade other currency types with this strategy. Notice the above information.
removed all nations that this system does not work with. Now that you know at what time you need to be at your computer ready to make the trade, we need to get ready 5-10 minutes before the announcement to trade.
Step 4: Watch how I setup my chart for a news release. Setup to the 1 minute chart on the currency pair you are planning to trade.
Step 5: As you can see above, the current price is 1.7831.
Step 6: Right Click on the chart about 10-15 pips above the current price and click EntryStop Buy. You are requesting to buy when the currency hits your price.
Step 7: Enter the amount of contracts you want to trade (in this example it is 1) and enter a Stoploss for 10 pips. Press OK.
Step 9: Now, do the same thing below the current price, except add in a EntryStop Sell 10-15 pips below the current price.
Step 10: What did you just do? You took the price range of the currency pair and stretched it 10 pips up and down to add a little bit of a safety net. You told the broker that if the price of the currency pair goes up to that high point then you will ―BUY‖, and if it goes down to the low point then you will ―SELL‖. You also told the broker to stop you out after losing ten pips incase of whiplash if that should happen.
If the price happened to go ―UP‖, and you would have ended up ―BUYING‖ the currency pair. It could just as well gone ―DOWN‖, and you would have ended up ―SELLING‖ the currency pair. It doesn‘t really matter with this strategy which way it goes, just that it moves a lot of pips.
You could also, set the optional profit limit to 20 pips. So basically, you don‘t have to know if the news is going to be good or bad. All you do is wait until one or the other is executed on news. Once one or the other is executed, you simply cancel the other order and then wait and take a profit when you think is best (20-30 pips is usually about average). However, don‘t wait to long because the price could drop very quickly after the initial run.
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