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NEWS Trading or TECHNICAL Trading?

  • #1
  • First Post: Jul 31, 2007 8:03am Jul 31, 2007 8:03am
Hi experts out there,

Im still wondering what is the best way to trade forex market?

Some of the expert say NEWS TRADING....some other experts would say TECHNICAL trading???

Please provide me some idea...where should i start from?
  • #2
  • Jul 31, 2007 8:26am Jul 31, 2007 8:26am
first of all, I am not expert.

But I think I could give u some clues.

News trading seems to be profit in a short term, but it's always turns to be lost in long run. No matter how cautiously you managed your postions, or how many guru's report you get.(except you are working at big firms)

Techinically trading seems to be the way to make profit in long time, if your Money management, your trading system and psychology factors are good.

So keep learning around here and do your practise,pracitise,practise.

Good Luck
mike
Trading is a business
  • #3
  • Jul 31, 2007 8:34am Jul 31, 2007 8:34am
Thanks a lot mike....

any other good comments??
  • #4
  • Aug 16, 2007 1:37pm Aug 16, 2007 1:37pm
If your going to be successful with a technical system you must know what where and when news is happening and understand how it impacts the markets you are trading. Bottom line is economics change the value of the various world currencies, not technicals. To much to explain here shoot me a pm if your interested.
  • #5
  • Aug 16, 2007 3:12pm Aug 16, 2007 3:12pm
Im no expert either but some points to think about

- Market action discounts everything
Everything that can possibly affect the price is already reflected in the price of that market

If you accept this theory, there is no need to study fundamentals. You just need a passing knowledge of it.

-Technicals can know the underlying fundamentals indirectly.


Often in history, trends have started with little or no fundamental changes.

There is another issue, and thats with timing. In stocks, you can have a buy and hold approach. In forex, because of the high leverage, you can be trading with the trend and still lose money. This is because of the high leverage that small movements or "noise" can stop your trade.
This is why you need Technical Analysis for timing your trade.
  • #6
  • Aug 16, 2007 4:00pm Aug 16, 2007 4:00pm
Quoting keanwai
Hi experts out there,

Im still wondering what is the best way to trade forex market?

Some of the expert say NEWS TRADING....some other experts would say TECHNICAL trading???

Please provide me some idea...where should i start from?
We all will have our opinions, it shouldn't really matter to you what anyone says. Not meaning they arn't sincerely trying to help you, its just that the question you are asking depends on your mind set more than someones opinion. Try not to let others sway your biased to either way, fundamental or technical. It seems that if you understood the tendencies of these trading approaches, you would already know where to start. Get a demo account and try trading the news, see if it works for ya, then try trading technical. You may find that your preference is leaning to one side or the other.. or a mix of both. But explore a little, and take your time.

Good Luck.
  • #7
  • Aug 16, 2007 4:08pm Aug 16, 2007 4:08pm
As far as I know there is a BIG difference between News trading and Fundamental trading. As mentioned in previous threads, news trading is a risky approach.
  • #8
  • Aug 17, 2007 12:26pm Aug 17, 2007 12:26pm
Technical
Trade what you see, not what you think.
  • #9
  • Aug 18, 2007 7:10am Aug 18, 2007 7:10am
I think it depends on whether you are a news trader expert or a technical analysis expert...

All in all... you are what you trade.
  • #10
  • Aug 18, 2007 8:53am Aug 18, 2007 8:53am
Quoting keanwai
Hi experts out there,

Im still wondering what is the best way to trade forex market?

Some of the expert say NEWS TRADING....some other experts would say TECHNICAL trading???

Please provide me some idea...where should i start from?
Try them both (as well as other approaches) in demos & micros until you find what works best for you. The basic systems are primarily starting points from which you evolve your own style suited to your own strengths & weaknesses.
  • #11
  • Aug 18, 2007 8:54am Aug 18, 2007 8:54am
Quoting Censce
We all will have our opinions, it shouldn't really matter to you what anyone says. Not meaning they arn't sincerely trying to help you, its just that the question you are asking depends on your mind set more than someones opinion. Try not to let others sway your biased to either way, fundamental or technical. It seems that if you understood the tendencies of these trading approaches, you would already know where to start. Get a demo account and try trading the news, see if it works for ya, then try trading technical. You may find that your preference is leaning to one side or the other.. or a mix of both. But explore a little, and take your time.

Good Luck.
Although I am biased to the technical side, I think this is an excellent reply. We all have to find what works best for ourselves. Starting on one path may lead to a different one.

  • #12
  • Aug 19, 2007 2:58pm Aug 19, 2007 2:58pm
You cannot trade one without the other in my opinion.

If EUR/USD is at 1.3500 for example: (this is theory, not reading charts now.)

1) There is good fundamental news for Europe coming out right now....

2) There is also some major resistance at 1.3525.

3) The next major resistance spot is say, 1.3610.

4) You do not know if this announcement is what the "Big Boys" are looking at, you can only guess.

5) Your execution is not as far as the execution the guys at Citibank get. Oh, and by the way, by the time you get the news, their orders have already been placed.

6) Someone said that news drives the technicals. This is true to a point, but when? Today? 4 o'clock? Latvian Independence Day? Who knows?


So my question is this: What do you do?

Here's what I would consider -

Putting an order in to buy it at 1.3535. It will have broken through resistance, and has some room to go to the next part.

In doing something like this, I have used two disciplines at once. I recognize that the fundamentals are saying up, so I am thinking along those lines. BUT I waited for stops to get taken out. I saw that from technicals.

I would suggest that you timing has to be through technicals, and your expectations should be fundamentals. But the truth is: Nobody cares what your expectations are, just where THEIR STOPS ARE.

Just my two pips.


Clockwork71
  • #13
  • Feb 1, 2008 11:08am Feb 1, 2008 11:08am
If you like guessing for your wins, then by all means, use a Market Maker and any chart for technicals that you can think of, i guarantee you a loser in the end. There's a book called

'The Guts and Glory of Trader Who Made & Lost $1 Million'

read it sometime.
  • #14
  • Feb 1, 2008 11:27am Feb 1, 2008 11:27am
Quoting Xenjin
Im no expert either but some points to think about

- Market action discounts everything
Everything that can possibly affect the price is already reflected in the price of that market

If you accept this theory, there is no need to study fundamentals. You just need a passing knowledge of it.

-Technicals can know the underlying fundamentals indirectly.


Often in history, trends have started with little or no fundamental changes.

There is another issue, and thats with timing. In stocks, you can have a buy and hold approach. In forex, because of the high leverage, you can be trading with the trend and still lose money. This is because of the high leverage that small movements or "noise" can stop your trade.
This is why you need Technical Analysis for timing your trade.
The last part of this post is pure bollocks. You choose the leverage not the market!
  • #15
  • Feb 1, 2008 11:48am Feb 1, 2008 11:48am
technical trading
  • #16
  • Feb 6, 2008 11:54am Feb 6, 2008 11:54am
Im with 100% Technical Trading... I consider fundamental as a dangerous style of trading ... Where as if you have some experience and you are expert then by the help of technical analysis you can justified the market trend and it's direction ... And that is what we call forex...
  • #17
  • Feb 6, 2008 12:09pm Feb 6, 2008 12:09pm
The truth is, a combination of understandings is at minimum the building blocks of becoming a successful trader. I do not know any successful technical traders that do not have atleast a basic understanding of how fundamentals affect the market. I am a technical longer term trader, however I do understand the current economic conditions of the countries I am trading in and will generally try to be trading in the direction of those fundamentals.

As far as anyones own trading, you need to find your own style that is comfortable for you to be trading and focus in on it. That is where you will find your success. The truth is the most successful people I know have very simple systems, they are very comfortable trading their system and psycologically ready for the types of drawdowns their particular system might produce whether that is large or small.
The basis of a democratic state is liberty. ~ Aristotle
  • #18
  • Feb 6, 2008 5:26pm Feb 6, 2008 5:26pm
i'm not using news and any technical method to trade anymore but i think learning about its strengths and weaknesses won't hurt

just my 2 cents, be friend with the big boys

if you are still insisting using the news pls refer to how the double fed rate cut affected the market on Jan. pls tell me if anyone can 90% sure about this before the meetings. same news two strong opposite directions. also using the news means, i assume, that we are facing a big threats called intervention. the reason is that if central bank (or any banks) tries to control the market, they better doing it near the big news.

for the technical issue, which I adore a while ago, there is one problem. that problem roots from the original variable of indicators and that is moving average. which means i will only make money if i trade along with the ma. it sure works and the probability with the correct match of pairs vs indis might get near 60% but might also failed to only around 25% when the big boys come into play. i'm just using common sense and not the common understanding, by big boys i'm referring to those players who are waiting for economic troubles as signals to enter or exit the market. they will make the market increase its volatility and of course disrupt the ma (and other indicators as well). if anyone wants to know their actions just compare the 2006 and 2007 data.

there are still many ways to trade other than these two methods. trading is also a world of learning
  • #19
  • Nov 4, 2010 10:02am Nov 4, 2010 10:02am
ppl says technical works but actullay market is driven by fundamentals so one must put efforts to know fundamentals infact trading with news is only way to survive in the market,if u ask to those who trade for living u will find 90% of them just trade while news is comming out.
  • #20
  • Nov 4, 2010 11:13am Nov 4, 2010 11:13am
Quoting Alihuzaifa
ppl says technical works but actullay market is driven by fundamentals so one must put efforts to know fundamentals infact trading with news is only way to survive in the market,if u ask to those who trade for living u will find 90% of them just trade while news is comming out.
I agree to a point. News makes volatility, so I don't understand why people don't want to trade during those times.

However, given the way brokers now work and the sheer craziness of some news events, I try to get positioned before they happen. If I can get a large enough profit, then I want to see if the volatility goes my way. If I'm in a trade without a large enough buffer 2-3 minutes before the news, I close it.
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