20 RULES TO STOP LOSING MONEY

20 RULES TO STOP LOSING MONEY

1. Do not rely on other opinions

This is the money at stake, not yours. Make your own analysis, regardless of source of information.

2. I do not believe in the company

Trade is not the investment. Remember that the numbers and forget the press.

3. Do not break the rules

That for serious situations such as you are probably at this time.

4. Do not try to get even

Trade is not a game of make-to-date. Each position must be maintained on its own merits. Complete loss of composure, and take the next trade absolute discipline.

5. No commercial head

If his name is a buffet, or Cramer, do not trade much. Concentrate on the game, and do not bother to make money.

6. Do not seek the holy grail

It is no secret trading formula, other than solid risk management. So stop looking ga.

7. Remember that discipline

Learning the basics is easy. Most traders do not because of lack of discipline, not a lack of knowledge.

8. Not pursue the crowd

Play and beat their drums. At the time of the multitude of events, which is probably too late ... or too late.

9. No obvious trade

The most beautiful set of samples of the most painful loss. If it seems too good to be true, it probably is.

10. Do not ignore warning signs

Big losses rarely come without notice. Do not wait for a lifeboat to leave the sinking ship.

11. Do not count your chickens

The benefits are not recorded until the trade closes. In the market, given the market and takes away with great fury.

12. Do not forget the plan

Remember why we had the first trade, and should not be blinded by volatility.

13. Do not have a mentality of paycheck

You do not deserve anything for all their hard work. The market is only profitable when it is right, and that your time is very, very good.

14. Do not join the group

Trade is not a team sport. Avoid actions boards, chat rooms and financial TV. Want the truth, not blind support from others with their views.

15. Do not ignore your intuition

Respect Mali voice tells you what to do and what to avoid. It is the voice of the winner trying to reach the thick head.

16. I hate losing

We expect to win and lose with great regularity. Expected to teach it to lose the victory because that victory.

17. Do not fall into the trap of complexity

A well trained eye is more efficient than the battery of indicators. Common sense is more valuable than the copy of the test system.

18. Not to be confused with the possibility of execution

Overpriced software will not help you to trade like the pros. Beautiful colors and lights that fast trader, not better.

19. Project not his personal life

Commerce provides the perfect opportunity to discover how smelly your life really is. Find your house in order before playing the markets.

20. I do not think its fun

Trade should be boring most of the time, like a real job you have now.

HOW TO MAKE FOREX ORDER

HOW TO MAKE FOREX ORDER

There are several basic types of goal that all brokers provide and some other strange sounds. Basic is:

1. Marketplace

2. Limit orders

3. Stop-loss order

4. OP (Good til canceled)

5. GFD (Good Day)

6. OCO (order cancels other)

Advantages of trading the Forex Market

Advantages of trading the Forex Market

• High Leverage (low margin): Generally forex brokerage service providers offer a

leverage of 100:1. This means for every $1,000 you place in your account you have
access to trade with $100,000 worth of contracts.
The traders can utilize a small amount of funds in order to take a large position. If you
should happen to incur a loss, your broker will close your position when the loss equals the balance in your account.
• Liquidity: The forex market trades between $1.5 and $2 trillion daily. The market
orders are almost filled instantaneously and the market is too large for any one to
control.
• 24 Hour trading: The forex market operates 24 hours a day from Monday morning
Sydney – Australia time to Friday evening New York (EST) time. Therefore traders
have immediate access to information, their accounts and transaction ability.
• Trade both sides of the market: You can profit from price movements in either
direction, whether prices are going up or down. You can profit in a bear or a bullish
market and the economy of any country is irrelevant to make profits.
• Low trading costs: Forex brokers will only charge you for the difference of a bid and ask price.
sell price quote. There are no commissions or other charges payable buy the trader.

Carry Trade Panic Selling?

Carry Trade Panic Selling?

Did anyone notice the panic selling out there?All kinds of carry trades unwound several hundred points in a very short period of time. Speculation in the Forex news rags suggests that losses due to the falling stock exchanges forced people to unwind their carry trades to cover their margins.In any case, after days of regimented downward movement, the sudden fallout represented a panic moment -- for someone. In the short term, at the very least, this should represent opportunity. I've stuck my toe in.

Forex Success Key Points & 7 Reasons of Forex Trading

Forex Success Key Points & 7 Reasons of Forex Trading

3 Primary Reasons to Trade with Asia Kapitalindo

1. Asia Kapitalindo is a very respectable broker.

Aside from being registered to all three Indonesian futures associations: Bappebti, BBJ and KBI, there is no bad word-of-mouth nor bad review from the internet about Asia Kapitalindo. News spread really fast on the internet and yet there has NEVER been any bad mouthing of Asia; that's pretty impressive we must say.

2. Asia Kapitalindo provides a fixed spread of 5 pips.

There are many international brokers that claim to provide low pips as low as 1-2 pips but widen the spread to tens of pips during certain times. Asia Kapitalindo's spread might be relatively larger than the

Forex Faculty thinks that forex trading is the ultimate way to take you to your financial freedom. But why? What are the reasons? Are they good? Also as importantly, are they valid?

There are a lot of people that have reached their financial freedom state. Take Bill Gates as an example. We bet a hundred bucks that he's financially free now. Did he get there by forex trading? Maybe, we don't know him personally but we're pretty sure it was most likely due to his business in developing the "Windows" platform.

Besides Bill Gates, there are a lot of other people that do not have to worry about their financial state but they have never been involved in currency trading before. So why does Forex Faculty make this controversial claim?

We want to persuade you that there is a very strong reason to start forex trading. This is one of the financial foundations toward a successful forex trading. You must realize the potential of forex trading before you can have the right mindset, attitude, and confidence while trading. And as you have probably known, having those 3 components are crucial in to make the appropriate decision during forex trading.

So first of all, let's be clear about the state of being "financially free". We should list the criteria of being financial freedom. We believe that achieving financial freedom should have the followings characteristics:

1. having sufficient income to cover the current "wants"
2. #1 should not be bounded by location, that is, having sufficient money anywhere
3. #1 should not be bounded by time, that is, having sufficient money anytime
4. #1 should be fast paced, that is, sufficient income should come at a rapid pace
5. #1 should be based on a safe environment, that is, can get income safely without worrying about scam, fraud, and the likes
6. there has to be a LOT of opportunity for #1. That is, when 1 opportunity is gone, another one is already at hand to be operated on
7. attaining #1 should be simple enough, that it does not require tremendous hardwork.

These are the Key Success Factor in attaining financial freedom. That means, if your curent job has a very strong similarty to those characteristics, then you are pursuing your financial freedom in the most effective way possible. And this is exactly the case with Forex Trading.

Forex Trading:

1. if successful, is one of the best source of income to cover all your "needs" and "wants". That is because it promises an unlimited return while at the same time you can significantly minimize the risk.
2. is not bounded by location. You can trade currencies anywhere there is an internet connection
3. is not bounded by time. You can trade currencies anytime as long as you are connected to the internet
4. is happening in a very fast pace fluctuating market. That means, you can earn a lot of money at a very rapid rate.
5. is very safe. As long as you are trading with a registered, trustable and respectable broker, your money is basically sitting there, untouched, for your trading convinience
6. involves 2 vertical dimensions and typically more than 5 horizontal dimensions. Whether the market is going down or up, you can earn money. And when a market of a specific currency is not presenting good opportunity, you can always switch to another market.
7. And lastly, forex trading is one of the simplest forms of investments.

Top 10 currency traders

Top 10 currency traders

% of overall volume, May 2008RankNameVolume1 Deutsche Bank21.70%2 UBS AG15.80%3 Barclays Capital9.12%4 Citi7.49%5 Royal Bank of Scotland7.30%6 JPMorgan4.19%7 HSBC4.10%8 Lehman Brothers3.58%9 Goldman Sachs3.47%10 Morgan Stanley2.86%

Forex? What is it, anyway?

Forex? What is it, anyway?

The Market Explained

The currency trading (FOREX) market is by far the biggest and the fastest growing market on earth. It has a daily turnover of more than 2.5 trillion dollars, which is 100 times greater than the NASDAQ daily turnover. (click here to read full market background by Easy-Forex™).

Markets are places to trade goods. The same goes with FOREX. The Forex goods (or merchandise) are the currencies of various countries. You buy Euro, paying with US dollars, or you sell Japanese Yens for Canadian dollars. That's all.

How does one profit in Forex?

Very simple and obvious: buy cheap and sell for more! The profit is generated from the fluctuations (changes) in the currency exchange market.

The nice thing about the FOREX market, is that regular daily fluctuations, say - around 1%, are multiplied by 100! (in general,Easy-Forex™ offers trading ratios from 1:50 to 1:200). If, for example, the exchange rate of "your" pair of currencies increased by 0.6% in the last 4 hours, your profit will be 60% on your investment! Such can happen in one business day, or in a few hours, even minutes.

Moreover, you cannot lose more than your "margin"! You may profit unlimited amounts, but you never lose more than what you initially risked and invested.

You can implement your choice (the pair of currencies, the volume amount) under any direction to which the market is moving, and yet make profit. It does not matter whether the exchange rate is going up or down: you can always decide to buy Euro and sell dollar, or vice versa - buy dollar and sell Euro. You don't have to physically possess certain currencies in order to perform "buy" or "sell" with them.

How do I start?

Register (Easy-Forex™ offers the simplest and quickest registration process, no obligation); deposit your first trading "margin" amount (credit cards are welcome, only by Easy-Forex™);start trading.

It can't be simpler or easier than that. Need help? We'll provide you with 1-on-1 training and service, as much as necessary (Easy-Forex™offers real people service, live, in your own language).

How do I trade Forex?

You select the pair of currencies with which you wish to make a Forex deal. You determine the volume (the amount of the deal). You deposit the "margin" (collateral needed to facilitate the deal. Usually - only a very small portion of the whole deal, say: 1% or 1:100).

Before you finally activate the deal, you can still "freeze" it for a few seconds. That enables you to either change the terms, or accept it as is, or altogether regret the whole idea. The "freeze" feature is a unique service by Easy-Forex™.

When your Forex deal is running (you hold an "open position"), you can monitor its status and check scenarios online, whenever you wish. You may change some terms in the deal, or close it (and cash the profit, if any, or minimize the loss, if any). Moreover, Easy-Forex™lets you determine a "take-profit" rate, with which the deal will close automatically for you, when and if such rate occurs in the market. Meaning: you do not have to stay near your computer when you hold open positions.

Carry Trade Panic Selling?

Carry Trade Panic Selling?

Did anyone notice the panic selling out there?All kinds of carry trades unwound several hundred points in a very short period of time. Speculation in the Forex news rags suggests that losses due to the falling stock exchanges forced people to unwind their carry trades to cover their margins.In any case, after days of regimented downward movement, the sudden fallout represented a panic moment -- for someone. In the short term, at the very least, this should represent opportunity. I've stuck my toe in.

Forex Market Deconstruction

Forex Market Deconstruction

Now that the trading week is over I thought I'd write about a few things that came to mind over the last couple of days.Current SituationEveryone is expecting the Fed to come along and put a multi-hundred billion dollar package together with the help of congress. Obviously, this is relieving a lot of the unprecedented pressure on both stocks and various Forex markets. The only fly in the ointment I'd keep an eye on is whether or not things get delayed for any period of time

Okay, so it doesn't look like anything at all is happening as of yet. Personally, I'm scalping the EURUSD on the 1 min chart this evening.It seems that nobody is willing to assume that the house will pass the bailout bill this time around. So, once again, we find ourselves in a state of financial stasis. In fact, given the rise that occurred on the original announcement, it may just be that we are priced in already.If so, that means there is really only a downside, which we'd see on failure.Who knows?Cover your assets! ;)

Retail foreign exchange brokers

Retail foreign exchange brokers

There are two types of retail brokers offering the opportunity for speculative trading: retail foreign exchange brokers and market makers. Retail traders (individuals) are a small fraction of this market and may only participate indirectly through brokers or banks. Retail brokers, while largely controlled and regulated by the CFTC and NFA might be subject to foreign exchange scams.^[7][8]At present, the NFA and CFTC are imposing stricter requirements, particularly in relation to the amount of Net Capitalization required of its members. As a result many of the smaller, and perhaps questionable brokers are now gone. It is not widely understood that retail brokers and market makers typically trade against their clients and frequently take the other side of their trades. This can often create a potential conflict of interest and give rise to some of the unpleasant experiences some traders have had. A move toward NDD (No Dealing Desk) and STP (Straight Through Processing) has helped to resolve some of these concerns and restore trader confidence, but caution is still advised in ensuring that all is as it is presented.

WHAT FOREX IS NOT

WHAT FOREX IS NOT

Forex is not a quick rich scheme.
Forex is not easy even though my blog says so.
Forex is not a place for newbie
Forex is not something you can learn overnight
If you needed the money, dont put it in Forex. Seriously. Go somewhere else.
Forex is a journey, enjoy it.
There is no such thing as holy grail coz there is no perfection in this world. If perfection exist in this world it would be boring. No more room for improvement.
Forex is not rocket science. There is no right or wrong. There is only probability.

BIG PLAYERS SEE ONLY BIG NUMBERS

BIG PLAYERS SEE ONLY BIG NUMBERS

I am typing this from my pc. It a bit of a mess now, the new house still needs a little work and I am not feeling well lately. Maybe its the change in climate.

This week I am going to talk about numbers only. Forex is after all based on numbers. Example, I have a long position on GBPUSD @ 1.4700 with a profit of 320 pips at the moment and still holding.

What I am going to say is big players only see big number. The do not see the last 2 digit. The last 2 digit is for scalpers. Big players only see the 1st 3 or 4 digit only. So if a bank wants to buy or hedge a currency they will give an instruction to buy at 1.47. Thats it. Simple yet people fails to see it.

So what happens at 1.47? The price will bounce of or hover around it but things arent always what they appear to be. What happen is price will have a range between 1.46 - 1.48. That is almost 200 pips wide range. Imagine what happen to your 50 or 100 pip SL?? Now you know why people lose money even though they have the right direction.

These big players have big money they dont mind to stand few hundreds negative pips coz in the end they will profit big time. What they do is they will have a standing order to trade at certain level. Because the total amount of order, the market cannot fill the order in 1 transaction and so price will hover or bounce of a certain level. This is where double top or bottom appear. Behind it is the action of filling orders by these big players.

Example EJ currently have a top of 1.34 and a bottom of 1.30. Big players are playing the game here. At the moment EJ is climbing and there is a big possibility that it will reach 1.34 again. I have a standing order to buy EJ at 1.30. If it hits there is a very big chance for 400 pips gain. Only time will tell.



Attach is a chart of GBPUSD. If you look carefully, you can see my actual entry point. I will explain the rest of the chart in due time.

How to Learn Currency Forex Online Trading

How to Learn Currency Forex Online Trading

Instructions

Step1

Study currency forex online trading through books, DVD courses, and online. Join online forums to pick up tips and tricks from active day traders. For a quick start on your learning curve, see Resources below.

Step2

Practice currency forex online trading by signing up for a practice account at forex.com. This is a free service, which allows you to make virtual trades for 30 days. As you are learning forex, apply your knew trading skills without the risk of actually losing money.

Step3

To begin currency forex online trading with real money, sign up with a reputable broker. If possible, get referrals from people you know. Check the FTC website to make sure your broker is honest and professional.

Step4

Complete the comprehensive training offered by yourbrokerage firm. If your broker offers no training, get another broker. You should have no problem finding a company that will teach you currency forex online trading.

Step5

When you are ready to invest your own money, start small. Set aside no more money than you are willing to lose while you are perfecting your currency forex online trading system.

Step6

For more information on currency forex online trading, check out Resources below or the section on this page titled More Articles Like This

Forex Technical Analysis=>

Forex Technical Analysis=>

Technical analysis is the process of market analysis that relies only on market data numbers - quotes, charts, simple and complex indicators, volume of supply and demand, past market data, etc. The main idea behind Forex technical analysis is the postulate of functional dependence of the future market technical data on the past market technical data. As well as with fundamental analysis, technical analysis is believed to be self-sufficient and you can use only it to successfully trade Forex. In practice, both analysis methods are used. Recommended e-books on Forex fundamental analysis are:

The Law Of Charts

Candlesticks For Support And Resistance

Trend Determination

Money Management in Forex

Even if you master every possible method of market analysis and will make very accurate predictions for future Forex market behavior, you won't make any money without a proper money management strategy. Money management in Forex (as well as in other financial markets) is a complex set of rules which you develop to fit your own trading style and amount of money you have for trading. Money management play very important role in getting profits out of Forex; do not underestimate it. To get more information on money management you can read these books:

Risk Control and Money Management

Money Management (A chapter from The Mathematics of Gambling)

Forex Fundamental Analysis=>

Fundamental analysis is the process of market analysis which is done regarding only "real" events and macroeconomic data which is related to the traded currencies. Fundamental analysis is used not only in Forex but can be a part of any financial planning or forecasting. Concepts that are part of Forex fundamental analysis: overnight interest rates, central banks meetings and decisions, any macroeconomic news, global industrial, economical, political and weather news. Fundamental analysis is the most natural way of making Forex market forecasts. In theory, it alone should work perfectly, but in practice it is often used in pair with technical analysis. Recommended e-books on Forex fundamental analysis:

Reminiscences of a Stock Operator

What Moves the Currency Market?

Forex for Dummies

Forex Basics

If you've already read the "What is Forex?" section then you should know what Forex market is and what it is all about. If not, please, do it. There are five essential aspects of foreign currency market a beginner trader (and an old one as well) should be aware of:

Forex Fundamental Analysis

Forex Technical Analysis

Money Management

Forex Trading Psychology

Forex Brokerage

Understanding and mastering these sides of trading are crucial to organize your Forex trading experience.

Advantages of trading the Forex Market

High Leverage (low margin): Generally forex brokerage service providers offer a

leverage of 100:1. This means for every $1,000 you place in your account you have
access to trade with $100,000 worth of contracts.
The traders can utilize a small amount of funds in order to take a large position. If you
should happen to incur a loss, your broker will close your position when the loss equals the balance in your account.
• Liquidity: The forex market trades between $1.5 and $2 trillion daily. The market
orders are almost filled instantaneously and the market is too large for any one to
control.
• 24 Hour trading: The forex market operates 24 hours a day from Monday morning
Sydney – Australia time to Friday evening New York (EST) time. Therefore traders
have immediate access to information, their accounts and transaction ability.
• Trade both sides of the market: You can profit from price movements in either
direction, whether prices are going up or down. You can profit in a bear or a bullish
market and the economy of any country is irrelevant to make profits.
• Low trading costs: Forex brokers will only charge you for the difference of a bid and ask price.
sell price quote. There are no commissions or other charges payable buy the trader.

What is margin?

Margin is a performance bond, or good faith deposit, to ensure against a

trading losses. The margin requirement allows traders to hold a position much
larger than the account value.
In the event that funds in the account fall below margin requirements, your require
broker will close some or all open positions. This prevents clients' accounts
from falling into a negative balance, even in a highly volatile, fast moving
market.

For example, let's say you have an account with $10,000. That means you have $10,000 of usable margin. If you use $7,000 to Ask 7 lots o f USD/JPY, you now have $3,000 of usable margin left, meaning that you are allowed to lose $3,000 before you are under the margin requirement. The account equity remains at $10,000 until you begin to make or lose money on the position. Now, if the USD/JPY decreases to the point that you end up losing the $3,000 which is left in your account, then the broker will close all of your positions to ensure that you do not lose more than you have in your account.

Important: be aware of the risks

Finally, it cannot be stressed enough that trading foreign exchange on margin carries a high level of risk, and may not be suitable for everyone. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. Remember, you could sustain a loss of some or all of your initial investment, which means that you should not invest money that you cannot afford to lose. If you have any doubts, we recommend that you seek advice from an independent financial advisor.

How is Forex traded?

The mechanics of a trade are virtually identical to those in other markets. The only difference is that you're buying one currency and selling another at the same time. That's why currencies are quoted in pairs, like EUR/USD or USD/JPY. The exchange rate represents the purchase price between the two currencies.

Example: the EUR/USD rate represents the number of USD one EUR can buy.
If you think the Euro will increase in value against the US Dollar, you buy Euros with US Dollars. If the exchange rate rises, you sell the Euros back, and you cash in your profit. Please keep in mind that forex trading involves a high risk of loss.

Forex in a nutshell

The Forex market is the largest financial market on Earth. Its average daily trading volume is more than $3.2 trillion. Compare that with the New York Stock Exchange, which only has an average daily trading volume of $55 billion. In fact, if you were to put ALL of the world's equity and futures markets together, their combined trading volume would only equal a QUARTER of the Forex market. Why is size important? Because there are so many buyers and sellers that transaction prices are kept low. If you're wondering how trading the Forex market is different then trading stocks, here are a few major benefits.

• Many firms don't charge commissions – you pay only the bid/ask spreads.
• There's 24 hour trading – you dictate when to trade and how to trade.
• You can trade on leverage, but this can magnify potential gains AND losses.
• You can focus on picking from a few currencies rather then from 5000 stocks.
• Forex is accessible – you don't need a lot of money to get started.

Forex Earning Potential

Forex Earning Potential

Forex currency exchange trading is one of the fastest growing trade markets in the world. It is also the biggest with an estimated 1.8 trillion dollars being exchanged every single day.

With these stats to it's name it should come as no surprise that one of the major reasons for thisexponential growth is the fact that Forex trading offers incredible earning potential.

This is also why large multi-national corporations have been investing in foreign exchange for years and more and more individuals are utilizing currency trading to supplement their incomes and some are even living purely off the profits they make.

Forex News Trading

Forex News Trading

Traders on the Foreign Exchange market, Forex market for short, can potentially make thousands of dollars based on the volatility and fluctuations of a country’s currency. To better themselves and have a leading advantage over other traders, some Forex traders and investors participate in a practice known as news trading. The risks are very high, but the potential gains can be worth thousands of dollars and many traders and investors use this technique.
The technique of news trading is quite simple. It is the trading of foreign currency immediately before or after an important economic news announcement. After such announcements, there is a high possibility that market prices will fluctuate, either for the better or worse, depending on the announcement. For example, if the U. S. Federal Reserve announces another increase of the interest rate, many traders might invest in the U.S. dollar as it is expected that its value will appreciate. The main advantage of news trading is the potential for a country’s currency to make huge gains or losses in very little time. Within minutes of an economic announcement, a country’s currency can gain or lose one hundred points almost instantly. The potential of huge profits attracts Foreign Exchange traders and investors, however there are various risks associated with news trading.
Like any investment, there is always a risk, and news trading on the Forex market is no different. Though the potential profits are huge, the losses are also equally as large. The dangers of news trading come from the fact that a trade must be made quickly or else you are going to lose. If you are caught on the bad side of a trade, your money will be gone quicker than you can blink your eye. You will lose money so fast that there won’t even be time for you to manually close your trades, leaving you with nothing. Stop-loss orders are also potentially dangerous as there is a high probability of slippage because of the sudden price fluctuation.
Though some investors and traders might get lucky trading news, there is only a small probability that you will make a profit. Even if you are an expert news trader, you should still be very, very cautious when participating in this practice. Successful news trading depends solely on how you get your news. The most successful news traders are the ones with the fastest news feeds and those that are able to quickly place their trades immediately after an announcement has been made. Even using other forms of news trading, such as placing orders above or below the market price is still a guessing game, and those traders in the market who base their trades on guesses, won’t have much money after a short time.
For many Forex traders and investors, their trades are dictated by technical indicators and price indexes. Hours are spent researching every indicator, taking every risk into account and then making a decision based on everything they have studied. However, for a Forex news trader, none of this matter, and the only thing they take into account is economical news announcements.
News trading is possible because the Forex market is always open, unlike many financial markets. In a financial market, securities trades of certain stocks are suspended when an important company announcement is being made. These announcements are usually made after the market has closed for the day. However, because the Foreign Exchange market is open 24 hours, any economic announcement will have direct affects on the currency of that country, and maybe others as well. In the Forex market, there are eight major currencies that are traded, as well as over seventeen derivatives to be traded as well. This means that on any given day, there will always be economic announcements from any of the major traded currencies. The major trader currencies are as follows:
U.S. Dollar (USD)

Great British Pound (GBP)

Euro (EUR)

Japanese Yen (JPY)

Australian Dollar (AUD)

Swiss Franc (CHF)

Canadian Dollar (CAD)

New Zealand Dollar (NZD)

Because of the availability of each currency, currency pairs, and its derivatives, such as USD/JPY, EUR/USD, AUD/USD, as well as several others, each currency can be traded at any given time because these currencies are globally traded.
Any Forex news trader or news investor will have to have the latest most up to the moment news announcements. Even if the news announcements are only a couple of minutes old, this can have devastating effects for any trader who has risked any sum of money. Most news traders like to keep an eagle eye on any news regarding economical activity, but most importantly news dealing with interest rates changes, FOMC rate decisions, retail sales figures, inflation indicators such as the consumer price index (CPI), producer price index (PPI), unemployment figures, industrial production announcements, boost in business and consumer confidence, as well as business sentiment surveys. Manufacturing sector surveys, trade balance release details, and foreign purchases of U.S. Treasuries may also prove useful for a news trader to better make decisions regarding when or when not to trade.
However, it should be remembered that these news announcements can have ranging impacts on a country’s currency, and after an announcement, the volatility of a currency may greatly fluctuate. It is important to take advantage of news that creates movements in volatility that will last for a few minutes or even hours. Trading on the Forex market based solely on news is a difficult and sometimes dangerous practice. However, there are some indicators that can make a news trader’s job easier, such as breakout indicators (Bollinger bands, breakout of a candlestick bar, or a price bar). Research has proved that news announcements can impact a currency’s value quite severely, in some cases it can gain or lose anywhere from 33 pips to 124 pips, opening up the ideal trading opportunity looked for by news traders. If a news trader is able to act quickly enough, even the smallest news release can be turned into a potential profit of thousands of dollars. However, it is important to remember the volatility of such announcements, and although the profits seem endless, the losses can happen too.