If you’d like to trade forex news, try out this 1-minute forex news trading strategy.
The thing about forex trading is that every month, the forex calendar has important news announcements like; the non-farm payroll (Jobs Report), interest rate announcement, unemployment rates, and many more. These generally tend to move the forex market prices from 50-250 pips plus in just a few simple seconds to minutes.
You get the direction of your forex trade right, and you can be staring at 100 plus pips of profit in seconds if you are trading one standard contract that’s a $1,000 profit in minutes.
- Trading Timeframes: 1-minute
- Currency Pairs: EURUSD, USDJPY, GBPUSD, AUDUSD, NZDUSD, USDCHF
- Forex Indicators: None required
The 1 Minute Forex News Trading Strategy
If you trade forex during news times, you will notice something happens a few minutes after the news is released. For example, let’s say that the US Federal Reserve increased the interest rate. Expect the price to shoot up.
But after a while, the chart price will fall back down, making a lower high. And then the following candlestick forms and breaks past the high of the previous candlestick, and the price again continues to go up.
So this 1-minute forex news trading strategy is about trying to execute a trade on the retrace. So you are not straddling trading news. You wait for a reversal and watch price action when you see continuation happening.
Read More : Economic Calendar Explained and How to Use it
Forex Trading Events Calendar
To trade this forex system, you need to know the dates and times the major forex news will be released each month.
It would be best if you had a forex calendar, and the best place to get these would be over at the tradewithsam.com calendar.
Buy Trading Rules
- Head over to tradewithsam.com and see when the exact news is scheduled to be released.
- A few seconds after the forex news is released, refresh the trade with sam page so that you can see the figure(s) of the report.
- If the news is very good for the base currency, the price will shoot up; if it’s bad, the price will fall.
- Switch to the 1-minute timeframe (if you are using that) and watch the candlestick’s highs or lows.
- If the news is good for A Buy setup and currency shoots up, you will see the 1-minute candlesticks making new highs and higher lows. Then the price will start to reverse quickly and what you will see is that the highs will go lower, and the lows will go lower than the previous chart candlesticks.
- Your buy signal will be when a candlestick breaks the highs of the previous chart candlestick. You immediately buy at chart market price.
- Set your stop loss at 13-15 pips and set your take profit target at 45 pips (3 times what you’re risked).
Sell Trading Rules
For sell setup, it’s the exact opposite.
Here’s an example of a strategy sell setup, so you get the right idea of what I’m talking about :
Advantages of The 1-Minute Forex News Trading Strategy
Can avoid the price whipsaws that tend to take out a lot of straddle trades that have stop losses close due to increased spread during forex news release times.
Disadvantages of The 1-Minute Forex News Trading Strategy
1-minute candlesticks with lengths of 40-50 pips right after news releases should be avoided.
Read More: FUNDAMENTAL AND TECHNICAL ANALYSIS FOREX STRATEGY
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