Any way to "protect" your positions from the news?

Is there any way to "protect" your non-news-based positions from unexpected movements due to news releases? My last three trades that have been stopped out have done so due to large, news-driven movements. With the exclusion of the NFP release, and FOMC decisions, I'm not a news trader. I generally enter into positions that last 3-5 days.

I usually check for upcoming announcements before entering a position, but it's hard in FX because everything is so interrelated and news from one country can effect completely unrelated currency pairs. Is there a way to hedge against this using similar pairs, or something similar? I realize that news is a fundamental part of Forex and can't be eliminated, but I'm trying to minimize the impact of uncertain events on my positions.

Hmm I see three options;

1. close before news announcments
2. hedge your position
3. Factor in news announcements.

Other than that I dont know of any way to avoid the volatility caused by news. The whole forex market is based around news/fundamentals so I dunno how you could possible avoid it having any effect on your trades.

if im placing a market order, its usually in the asia session (sometimes NY if its an entry order though), and im usually fine. if your positions last 3-5 days (some of mine are as well), your stop should be loose enough to protect against these movements. excluding NFP and maybe some other releases, i dont think pairs move more than 15-20 pips. pairs usually begin to retrace after the initial spike. unless your position is already under water, you shouldnt get stopped out by the spike.

dunno... just my 0.02

Hello Loki,

In considering your strategy for news I have to ask what you take your long term postions base on?

I am doing my long term position with loose stop loss, around 30-50 pips from my original entry. Or if my position already in profit area, i move it to break even/with a little profit. In that case, if it is stopped, means i am not lucky enough to carry the position :-( and i may re-entry if the condition supports me. Trading is so dynamic, you trade with whatever you belief the market will go. If you are 90% sure of market direction, then do not use stop loss. But you have to know the risk, if the market go against you.

The simple answer is to use a properly placed stop loss....

Hedging, psychological stop losses, no stop losses...If you listen to this "advice" you might has well hand over your account now and go do something else, for it will surely be taken from you in a short time.

For big news, I suggest the sidelines, closing your trades. You live to see the next trade.

Don't be a pussy, take your stops off.

i beg you to ignore that last post .... you can attack it a couple of ways ...

1. loosen your stops (least prefered)
2. close your position
3. remove your stop (no no no no no)

Option 2 is the best option, however here is how you can use it to you advantage instead of just loosening a stop. Lets say you are short EURUSD through asia, it is +20 and your stop is 30 pips away coming up to a european news announcement and you are worried about price spiking and taking that stop out before continueing.

Close your +20 trade before the news, that is in the bank ... wait for the news, if it spike like you suggestion, see if you can time a re-entry to your original position at a better price, of course place an appropriate stop just like any other trade and it is usually best to wait at least 15-30 minutes after the news to let the "craziness" die down.

Of course you would only do this if your belief is the original position was a the correct one to hold on to, which I assume from the question is the point.

And don't sleep at all