#299: Should you trade the news?

Podcast: Should you trade the news? In this weekly video: 00:29 – News trading – does it work? 00:58 -  Or are you a technical Forex trader? 01:38 – Trading the US jobs news 02:20 – Australian employment data 04:18 – The choice is yours 05:19 – Send me your trading questions to [email protected] As a trader should you trade the news announcements or not? Let's talk about that and more right now. Hey traders, Andrew Mitchem here, the Forex Trading Coach with video and podcast number 299. So today I want to talk about news and trading around the news. Should you do it? Should you look at trading those high impact news announcements that come out every day of the trading week or not? News trading – does it work? Really, it depends on you as a trader as a person whether you want to or not. So really, if you're not sure a news trader or a fundamental trader is someone who trades news announcements. It basically becomes an opinion on whether you think that news is good or bad for a currency. You get the high impact news announcements like interest rates, employment, those type of things. Or you are a technical trader, like I am. Or are you a technical Forex trader? The technical trader looks at charts and looks at patterns and price action and price levels and technical indicators and you make your trading decisions from there. Of course, some people can use both. Although I'm a technical trader, of course I am aware of the news announcements and what's coming up and which currency they are likely to affect. I go and check what those results are. But the fundamentals do not affect my trading; I'm purely a technical trader. Because for me the charts tell me everything I need to know. Now, as a fundamental trader years ago ... 10, 12, 14 years ago, I used to trade nonfarm payrolls and nonfarm employment change. Trading the US jobs news First Friday of each month, US employment data. You speak absolutely easy, used to make a fortune from it, because you'd put a straddle on, a buy and sell stop, and the market would just break out massively one way or the other. I used to make a lot of money. But of course today, brokers have wised up on things like that. It's very hard to take straddle trades. The price can sometimes freeze on your charts around the high impact news times. The spreads can massively widen. All those kind of things. So that was a long time ago when that was easy to trade. Today it's very, very different. Australian employment data To give you an example, just yesterday on Thursday there was the Australian employment data came out. Now, a lot of jobs got created, far more than expected. The unemployment went down. So very, very good news for the Australian economy. However, on Wednesday on my membership site, and actually on the free information I post on various websites, I suggested buying the Australian Dollar against the US and against the Yen. But for my clients as a specific trade we had buy the Australian Dollar/US Dollar at these levels and the market order stop loss here and profit timing there and the reasons why. It's all taught in the course. Real simple. But we had an Australian Dollar/US Dollar buy trade on the daily chart based off the close of Tuesday's candle for Wednesday trading session. Yesterday, that trade hit the full profit target for a 3.2:1 reward to risk. So if you take a 1% risk on that trade, it made you 3.2% account gain. I took a 0.5% risk so it made a 1.6% account gain from that one trade, which took me about 30 seconds to see and about another 30 seconds to place on my platform. A 1.6% account gain. Simple. Yes, it took just over a day to get there. But the thing that I'm wanting to let you know...