Methods of News Trading: 2. Trade The Retracement

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Three Ways to Trade Fundamental News:

 

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2. Trade the Retracement

  • We wait for the news release to come out.  Based on the release number we will determine “where” to get into the market.
  • Usually we will wait for the market to come back within 10 to 15 pips of the pre-release. Depending on the actual deviation.
  • We will put our Stop/Loss 15 pips from the entry price.
  • We will take profit at least 25% of the position when we get 10~20 pips of profit, and at least 50% of the position when we retest the top or the spike.
  • This type of trade is safer than trading the spike, but sometimes we might not get a retracement at all or big enough and miss the trade altogether.

 

About Kelvin Ching

I'm a professional Forex trader and I have been trading for over 7 years. I was a series 3 broker and a registered CTA with the NFA, the main regulatory agency in the United States, and I have been involved at the highest levels in commodity trading. I also have a background in Information Technology, graphics design, and programming... I'm the co-founder of CurrencyNewsTrading.com, a site dedicated to fundamental analysis and news trading.

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