The forex market is a high liquidity market and every single second the market is moving in the direction of the trend. Most of the time the market participate its long movement in favor of the long-term prevailing trend in the market but sometimes it changes its direction which is known as trend reversal in forex terminology. If you are trading the financial instrument for a long period of time then you must know that fundamental news release is they factors to change the trend of any currency pair. Most of the novice traders in the forex market fails to make money in trading since they are not aware of the fact that the fundamental news releases are one of the most powerful price driving catalyst in the forex market. In this article, we will discuss it.
High impact news: There are mainly two types of news releases in the market and that is the low impact news and the high impact news. Most of the time currency pair changes the direction of the market during the major economic changes in the country. If you look at professional traders in Asia then you will notice that most of them are using forex trading account Singapore to execute high-quality trades in the market in favor of the long-term prevailing trend. As a trader, you must know the news release which is powerful enough to change the established trend in the market. For instance, the U.S interest rate decision can have prolonged impact on the currency pair market since it directly affects the investors of the financial world.
Short term volatility: Volatility is one of the most favorite element in the forex market for the professional traders. All the professional traders execute high-quality trades in their forex trading account during the event of the high impact news release and make a decent profit in the market. However trading the news release is one of the most complex tasks in forex trading since it creates a high level of short-term volatility in the market. So if you are relatively new in forex trading then make sure that you know how to execute the trades in the market in the high volatile market and chose a reliable broker like Saxo which offers excellent trading conditions and tight spread to their traders.
Price action signal: There are many news traders in Singapore who are making a decent income just by trading the news release in the market in their forex trading account Singapore. But in order to trade high impact news release, you need to learn the art of price action trading strategy. Instead of looking for price action confirmation signal in the higher time frame you should look for candlestick setup in the smaller time frame during the news. But when you trade the high impact news releases in the market make sure that you are using tight stop loss or in other words always follow the risk management factors.
Summary: High impact news releases is often considered to be the most powerful price driving catalyst in the forex market. If you are new in trading then don’t try to trade during the fundamental news release in the market. Make sure that you learn the basic of the forex market and develop a strong trading strategy before executing your trade during the news release. However, even after doing all the analysis in the market perfectly, you will often have some losing trades in the market but make sure that you embrace your losing orders in the market.