The forex market is an extremely volatile market and if you are relatively new in this industry then there is a strong chance that you will end up by losing in the market. Every single day people are participating in the world of the economic crisis to secure their financial needs in the market. Many people are doing 9 -5-day job in the financial world and at the end of the month they struggle hard and falls into depression. The economic performance of the country greatly affects the normal people life and even after having a great job in the market there is no guarantee that you will be financially stable in near future. But those who are trading the forex market are always floating in the world of financial stability since regardless of the economic conditions of the country they are making a decent income out trading the financial instrument. Since forex trading offers extreme profit potential to the traders every single day the number of new traders is increasing in this industry. Most of the rookie traders in the financial market tends to trade the news since the large movements occur during that event. But if you trade the high impact news release without knowing the right trading technique then there is high chance that you will blow up your entire trading account. In this article, we will discuss how to trade the high impact news release in the market.
Develop a strong foundation: Most of the novice traders in the financial world start trading the forex market without having any prior knowledge about the financial industry. They simply consider forex as a money making the machine and start trading the live asset in the market. But in order to make a consistent profit out of trading the financial instrument you need to have a clear understanding of the financial market. If you are relatively new then it’s true that you will have some tough time in understanding the basic movements of the market. So what should you do at that time? The answer is pretty simple. You can use the demo trading platform offered by reputed brokers in the financial market and learn different techniques and trading strategy with the virtual dollar. In the eyes of trained professional demo trading is one an essential element for the new traders in the market. By trading the financial assets with your demo trading account you can easily get the unique experience of high impact news release in the market.
Trade in favor of the long-term prevailing trend: Most of the retail traders in the financial industry fails to make money since they ignore the long term prevailing trend in the market. If you ignore the long term prevailing trend in the market than there is strong chance that you will find yourself in an awkward situation in most of the time of your trading career. Most importantly if you want to trade the high impact news release in the market than always make sure that you trade along with the long term prevailing trend in the market. All the expert news traders in the forex market draw the key support and resistance level in their trading platform before the high impact news release. So once the news release in the market they wait patiently for the price to touch certain levels in the market to execute their trade. On the contrary, the novice traders use the news information’s only for their execution of the trade. But in order to make the best possible trade in the market, you need to make sure that you are using all the three major types of analysis on the market.
Use price action confirmation signal: Most of the novice traders in the financial market consider forex trading as a get rich quick scheme. And due to their misconception, they often get the huge blow from the financial market in the early part of their trading career. As a trader, you should know that trading the financial news release in the market is extremely difficult and requires pin perfect execution of their trading plan. So if you are looking to trade the high impact news release in the market then you should consider using the price action trading strategy. All the professional news traders look for price action confirmation signal in the smaller time frame in their trading platform during the event of high impact news release. Price action trading strategy is based on the raw price movement of the market and the professional traders use the key support and resistance level in the market to execute their trades. So in order to trade the news release in the market, it is extremely important that you have a clear understanding about the support and resistance level. In order to enhance your news trading performance in the market, you can also use the equity research tools which will help you to pick the best trading assets in the market.
Summary: News trading can be extremely difficult for the novice traders since they don’t have the right experience and trading technique to trade the high volatile market. If you truly want to trade the high impact news release in the market then you should have a clear understanding of the financial market. As a news trader, you should always try to execute a trade in favor of the long-term prevailing trend in the market since it will greatly reduce your risk exposure in the market. And last of but not the least use price action confirmation signal before taking any trades in the market.