Check Scheduled News Events before putting on a trade
tend to create increased volatility in the currency markets, so it is important for a forex trader to monitor scheduled news events and important releases for the currencies that they are trading. There are many online resources where you can find an Economic Calendar to stay informed around these events.
Though it is very hard to make consistent profits trading news events themselves, nevertheless, knowing when important news is coming out, can be very important for the technical trader. For example, if we know that Non Farm Payroll is scheduled for tomorrow, we can wait until after the announcement before initiating any new trades. On the other hand, if we are currently in a position, we may consider either taking a portion or the full position off due the to higher than normal expected volatility around these events.
These are things that a forex trader must think about regularly. We cannot trade in a vacuum without knowing about potential impacts that can adversely effect our positions. The primary task of a Forex Trader is Risk management and the number one goal is capital preservation. And so we must act as responsible risk managers, and the one way that can reduce our risk exposure is by limiting our position size around highly volatile periods, which can cause extreme price movements and price spikes.