Wanna Trade On Economic Data Release.....?

[mohsinqureshii 10]

If you trade the forex markets you will know that there are important market moving economic data release almost every day. There will often be US related data releases between 8.30 and 10.00 (US time) which can have a major effect on the Dollar pairs and if you trade other currencies, then you also need to pay attention to specific news from that country. For Example, you need to keep an eye out for UK related news if trading one of the pound pairs.

When trading forex you always need to be aware of what news releases are scheduled for each day, but it is possible to actually make consistent profits trading off the back of the news itself?

Well in my opinion it is not possible to make sustainable profits trading these economic data releases simply because any subsequent movements after the announcements are often highly volatile and highly unpredictable.

They are basically open to interpretation, and any subsequent movements are based on trader's initial reactions to the news, which in itself can be unpredictable.

Sometimes you will find that straight after a news announcement, the market will move strongly in one direction or the other. this can either continue, or completely retrace and head in the opposite direction, making it impossible to trade.

This is because there is often a knee-jerk reaction to the news, and then subsequent move a few minutes later once traders have fully digested the figure.

You will sometimes find that seemingly good news for the Dollar, for example, will see a surprise sell off and vice versa. it is all about traders perception of the news and is basically too unpredictable to trade with any confidence so my advice would be to stay away from the economic data release, because there are plenty easier ways to profit from the forex market.

Thanks for your Time...