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Trading the news with perfect timing trading system

  • #1
  • First Post: Dec 16, 2012 3:16am Dec 16, 2012 3:16am
Hello Traders happy to say this is my third thread in forex factory, this is one of my favourite trading system apart from MACD and trend line which is located @ http://www.forexfactory.com/showthread.php?t=395428 am sorry i don't know how to teach you have to take as it is..i hope you will learn and enjoy this thread

lets get to business...

Advantages of trading the news with perfect time

  1. You don't need to sit at your PC all the time
  2. you will make money in instant
  3. loss are regain back instantly
  4. you have time to trade according to the news schedule


The System What You need to know?



1. It can work with broker that accept trading the news and lock position
2. It can work on 1Hour and 4 Hours Candle only)
3. No indicator at all
4.Trade high fundamental news with High impact only (even NON-Farm payroll)
5. Trade news with changes in the forecast
6. You can trade the cross of the currency that the news is about to release example USD you can
trade EURUSD,GBPUSD,NZDUSD,AUDUSD,USDJPY (any cross against USD)


Trading the news

Check http://www.dailyfx.com/calendar for the fundamental news that you will trade in a week.
Lets get down to business!!!!!!!!!
After you know the news you are going to trade all you need to check is

1. Changes
2. Time
3. Impact

All this three are all important. Before the news will be release you need to be at your terminal that is if
the news will be release by 3:00 PM you need to be at your terminal at 2:55 PM that is 5 minutes
before the news will be release.
What you need to do

• Now Turn your time frame to 4 Hours (or Any Time frame you like)
• Check the High & Low of the current candle and note it down,
• Check if the price is 5 or 6 pips different from the High & Low
• Place Sellstop to Low and Buystop to High
• Your Sellstop Stoploss should be at High and Buystop stop loss should be at Low
• Take profit should be 30-50 pips depends on the spike of the news
• Use Money management 0.1 lot recommended for Low equity
• For Equity above $200 calculate the different between High and Low then risk the amount you
want ( if high and low difference is 26 pips then for 0.10 lot you are risking 26*2=52 that is $52
that's too much then put 0.5 to risk $26 (Don't worry if you use 0.10 cause you will not lose)
• Increase Lot on Changes ( You will understand this in the example given)



See Examples below

USD Gross Domestic Product Price Index Time 13:30 Previous:2.6% Forecast: 1.90% changes:0.7%
• High=1.2149, Low=1.2135, Price=1.2139|
• That is 5 pips difference from low then we can enter our sellstop and buystop respectively
• 14 pips Difference from High and Low that is 28 pips risk in both side use 0.10 pips I risk $28

Before The News

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  • #2
  • Dec 16, 2012 3:18am Dec 16, 2012 3:18am

1 minute After the news
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  • #3
  • Dec 16, 2012 3:19am Dec 16, 2012 3:19am

No drawn down



Take profit hit
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  • #4
  • Dec 16, 2012 3:23am Dec 16, 2012 3:23am

Increasing Lot



Because of the Volatility of the current news some currency can burst out a spike and take a direction or
there is another news of the same currency before the candle close, Things that you can face during
this process
1. You can gain double of your pips
2. The price may reverse and go the other way

Solution

Whenever your stop either Sellstop or Buystop has been hit by the spike of the price then increase the
lot of the other stop,

Example- If your Sellstop has been hit with 0.1 lot then delete your Buystop and increase it with 0.3 lot
do not add another 0.2 lot cause you will be charge for the spread so trade wisely... check the example
below.
AUD Consumer Prices Index (YoY) 0:30 Previous:3.50% Forecast:3.30% Changes:0.20%

Before The News
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  • #5
  • Dec 16, 2012 3:26am Dec 16, 2012 3:26am

1Minute after the news



Whenever you have an order hit by price change the other one that is not hit with increase in the lot by 0.3
example-
• if you place a buystop and sellstop, the price hit the sell then delete the buystop and add a new one by increase the lot by 0.3 for 0.1 and for 0.10 that is 0.13 then make your take profit more bigger cause the price will favor you by moving in a big range ASAP
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  • #6
  • Dec 16, 2012 3:27am Dec 16, 2012 3:27am

Profit not hit



In this case the profit target was not hit by the market so we need to add the new buystop as soon as possible.
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  • #7
  • Dec 16, 2012 3:29am Dec 16, 2012 3:29am

Stoploss hit
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  • #8
  • Dec 16, 2012 3:31am Dec 16, 2012 3:31am

New buystop 0.3 lot add


In the picture below the market hit the news buystop and the take profit has been increase with 50 pips
that a double win!!!!!
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  • #9
  • Dec 16, 2012 3:33am Dec 16, 2012 3:33am

Take profit hit
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  • #10
  • Dec 16, 2012 3:36am Dec 16, 2012 3:36am
In the picture above shows the hit of the new buy take profit hit $65 profit or $6.5 now minus the stop
loss hit that is $2.6-$6.5=$3.9 or for 0.10 lot trader $26-$65=$39 profit still run every time you trade..
don't panic at all, cause no trade will make you loss you will always gain.

Please comment if there is anything that you don't understand, that is all you need to know about the trading system, i will be posting tradeable news here.

Note: if you can improve the strategy please don't hesitate to comment.. you are all welcome
  • #11
  • Dec 16, 2012 4:50am Dec 16, 2012 4:50am
Would you say that the market still responds to news in a predictable manner, or is it now a case of judging if it is Risk On or Risk Off??

I traded the news for years using the following guidelines and it used to be extremely reliable, but now!!

Bracketing a trade is common practice for Channel Breakouts and for trading news, but the volatility now can cause such large spikes on the lower TFs, is this why you recommend the 4 hr and because of the much larger stops required on this TF?
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Cut your Losers short and let your Winners run.
  • #12
  • Dec 16, 2012 4:59am Dec 16, 2012 4:59am
Quoting dee50
Would you say that the market still responds to news in a predictable manner, or is it now a case of judging if it is Risk On or Risk Off??

I traded the news for years using the following guidelines and it used to be extremely reliable, but now!!

Bracketing a trade is common practice for Channel Breakouts and for trading news, but the volatility now can cause such large spikes on the lower TFs, is this why you recommend the 4 hr and because of the much larger stops required on this TF?
yes..that is why i use 4hrs time frame it gauge what is happening in a session. i explain the money management if there is too much large stop loss then the lot will be reduce
"For Equity above $200 calculate the different between High and Low then risk the amount you
want ( if high and low difference is 26 pips then for 0.10 lot you are risking 26*2=52 that is $52
that's too much then put 0.5 to risk $26 (Don't worry if you use 0.10 cause you will not lose)"
  • #13
  • Dec 16, 2012 5:09am Dec 16, 2012 5:09am
Quoting afolabiay

• Check the High & Low of the current candle and note it down,
• Check if the price is 5 or 6 pips different from the High & Low


• High=1.2149, Low=1.2135, Price=1.2139|
• That is 5 pips difference from low then we can enter our sellstop and buystop respectively
• 14 pips Difference from High and Low that is 28 pips risk in both side use 0.10 pips I risk $28


Could you just explain please. Why price should be 5 pips difference from the High or Low before taking the trade. And what action should you take if the price is not 5 pips different, do you look for one of the other currency crosses that does comply?? assuming you have time to look before the news comes out.
Cut your Losers short and let your Winners run.
  • #14
  • Dec 16, 2012 5:19am Dec 16, 2012 5:19am
Quoting dee50
Could you just explain please. Why price should be 5 pips difference from the High or Low before taking the trade. And what action should you take if the price is not 5 pips different, do you look for one of the other currency crosses that does comply?? assuming you have time to look before the news comes out.
price must not be close to high and low because of volatility of the high news and it may hit the two stop before going it way then you lose twice which is bad but in case of you see high and low that is 5 pips or lower it is advisable to look for another cross to trade.. a normal high and low on 4 hours candle should be 10 pips
  • #15
  • Dec 16, 2012 5:34am Dec 16, 2012 5:34am
Quoting afolabiay
price must not be close to high and low because of volatility of the high news and it may hit the two stop before going it way then you lose twice which is bad but in case of you see high and low that is 5 pips or lower it is advisable to look for another cross to trade.. a normal high and low on 4 hours candle should be 10 pips

Thank you for clarifying that.
Cut your Losers short and let your Winners run.
  • #16
  • Dec 16, 2012 7:39am Dec 16, 2012 7:39am
Quoting dee50
Thank you for clarifying that.
you are welcome sir
  • #17
  • Dec 16, 2012 11:55am Dec 16, 2012 11:55am
Have you ever traded it on a real account? I don't think that you will get filled for a good price and when you get filled you will have to pay really high spreads.
  • #18
  • Dec 16, 2012 2:10pm Dec 16, 2012 2:10pm
Quoting Kilian19
Have you ever traded it on a real account? I don't think that you will get filled for a good price and when you get filled you will have to pay really high spreads.
its depends on your account type and your broker..you can trade it successfully on ECN/STP account which is non dealing desk. which broker did not have power over your spreads so no spread will be widening, FXCM and ForexTime are example of such broker you can see ECN account.
trading it on mini account or macro account is risky mostly on interest rate and non farm payroll they can move your spread to 100 pips which is risky
hope this help.
  • #19
  • Feb 15, 2013 7:46pm Feb 15, 2013 7:46pm
Well I notice this died off a couple months ago so I was just wondering if you are still using this strategy and is it still proving profitable? Thanks. It looks very interesting to me.
  • #20
  • Feb 16, 2013 2:27pm Feb 16, 2013 2:27pm
I have 12 students trading this method and have been making money with it since 2010,this thread is dead because nobody here like easy strategy that most broker hate.i have a lot of issues with brokers like liteforex,instaforex and tuneforex they ask me to change my strategy
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