I hear a ton of brokers letting me know that they are News Dealers. At the point when I ask them everything they mean they say to me that they trust that a financial declaration will emerge and afterward they exchange on the course of the declaration.
I will involve a speculative situation to make my point understood.
Suppose we have the Retail Deals discharge emerging from the U.K. in a short time. The market’s assumption is for an increment of 5%. On the off chance that the delivered number is higher than the assumption the Conventional News Merchant will purchase the GBP and assuming it is lower he/she will sell the GBP. While this could work at times in numerous different cases it will not.
The explanation is that a huge number of powers influence the cost of a couple and Monetary declarations are only one of the power however Not by any means the only power. Different factors incorporate the predominant pattern and the general ‘state of mind’ of the market.
No big surprise that so many News Brokers get scorched.
Today I will let you know the right approach to exchanging the news. Furthermore, I believe that you should peruse intently the accompanying proclamation:
The right method for exchanging as indicated by the News Deliveries is to exchange the response to the news and not the actual news.
Rather than purchasing the GBP assuming the UK retail deals come out surprisingly good, purchase the GBP on the off chance that you see that the GBP is ascending on better figures. On the off chance that the GBP is slowing down on better news, you ought to sell all things considered.
A perfect representation was the EURUSD continue on the fourteenth of September 2010. We had the ZEW financial opinion emerging from the European Association. This came out more regrettable than anticipated. Then, at that point, we had Retail Deals out of the US coming out obviously superior to anticipated. The mix of these two monetary deliveries ought to have sent the EURUSD killing. However, rather the EURUSD was slowing down, exchanging inside a 20 pips range. This was my sign for going long.
Think about what happened later. The EURUSD shot up by 200 pips in 3 hours.
So that’s it. I exchanged the response to the news and not the actual news.