4 steps to successfully trade on the news

And here you are… trying to find out whether you’re more of a fundamental trader o a technical one, which approach suits best your needs and of course, your wallet.
Don’t be mistaken. Trading on the news is not less work than using technical indicators. Fundamental trading requires as much analyzes and patience as any other approach out there. And no, reading the newspaper every morning won’t be particularly helpful. Below you’ll find four of the best and simpler advices you could ask to make real profits on the news:

Trade the right pairs
In case you read the newspaper every morning, you can indeed be of some help here. How many times a week or even a month do you read news about The Philippines? Have you heard anything about the Philippine peso? Do you get the idea? In order to have some actual work to do when trading on the news, you have to select currency pairs that count on big liquidity. Yes… we all know that you are aware about the EUR/USD. But there are more: USD/JPY, AUD/USD, GBP/USD, NZD/USD, EUR/CHF and it goes on and on.

Downscale your calendar
We live in the era of news. There are certain times, especially under market stress conditions, when news flow like the wind itself and it can be very, very overwhelming. Many traders believe trading on the news is less work on the computer. And then find themselves all day long standing in front of an online economic calendar. That’s a common mistake of newbies, which haven’t downscaled their calendars accordingly. Check on those filters and select only medium to high-impact events that have real effects on the pair. Otherwise, you’re losing precious time.

Manage risks effectively
Yeap. Again the same suggestion. And for a very good reason… your money. Fundamental trading, as we have already said above, is linked to highly volatile environments. And it shouldn’t surprise at this stage that volatility can play out perfectly well or terribly bad for your investments. Unless, you manage risks. How? Limit your order volume and set stop loss orders.

Don’t exclude technical indicators
Only total beginners would work entirely on one side or another. Real trading is about using every single thing available to take better decisions and make money. That’s why even if you are more of a fundamental trader, you cannot leave aside technical indicators. They are useful to determine momentum, support and resistance levels and check on how others are moving.