In this post we'll try to make it clear why false signals appear that make the trading strategy to give a false signal, and the trade turnes out losing.
Tag: trading the news
In this review, we will get acquainted with a useful news indicator FFcal. It tracts the publication of important news and reflects them directly on the price chart.
How do you use the GDP data in trading? In the classical variant, the GDP data significantly higher than forecast promises growth of the national currency, so buys are in priority. Conversely, the GDP data weaker than expected entails a decline in the national currency rate, so sells are recommended. Also, you should evaluate the technical picture and prepare a trading plan.
The size of the main interest rate is the base for the interest rates of other instruments, such as state and corporate bonds, credit rates for legal entities and physical persons. Central banks resort to changing interest rates rather seldom; such changes are considered major market events, and market players keep a close eye on them.
Non-Farm Payrolls (NFP) are essential data on employment in the USA, which shows changes in the number of employees out of the agricultural sector of the country during the last month. The indicator is based on a poll answered by some 400,000 companies and 50,000 households. Empirically, it has been figured out that if the NFP increases stably by +200,000 every month, the GDP surplus equals roughly 3%.
I suggest splitting the preparation for trading the news into three parts: choosing the time, preparing a trading plan, and trading in accordance with the plan.