Hi there! I am a total novice in forex trading and just thought I start a thread that documents my learning journey. I hope fellow babypips members could provide insights to my approach, as well as, questions that I might have.
What I am currently using to watch the charts are, OHLC Bar, 1 day and 1 week timeframes, Fibonacci Retracement, and SMA @ 365 and 150. I want to add Pivot Points, but still not sure how to apply it yet. I thought swing trading might be more suitable for me since I am a beginner. And I am sorta paper trading right now.
Even though I think I should use price action as my primary “weapon” to trade, I do stay up to date with the fundamentals. And this is when it gets really confusing sometimes. For instance, on 10-Mar-16, ECB announced rate cut from 0.05% to 0.00%. Shouldn’t that lead to the EUR drop? From the one-hour chart on 10-Mar from 2000 to 2100 hour, EUR / USD dropped from a high of 1.0990 to low of 1.0843, but in the subsequent 4 hours, it went up to 1.1218. The same thing happened when NFP was announced recently.
Prior to a new release, will we know if the news has already been priced in? Do we anticipate (or should I say, predict) rate decisions from central banks? Many thanks, everyone!
Hey bud. Novice and News are like water and Oil.
Stay away for 1` hour before and 1 hour after.
Trading news is best from a retailers position to catch and ride, cut and move on.
Buy stops and Sell stops should on be used, which will trigger when price RUNS thru them. Set a tight Trail, and see how that works out.
I would just rather not even mess around with the news. Its the Institutions that move the price and try to fool everyone, as to why your pair moves opposite of what the news actually is.
Learn Correlation to news. Although good news for a pair could be good, another pair might show different influence to the symbol initially effected thru the news itself. Currency is a tettertotter , for one to go up, another must go down.
Thank you MoneyNVRSleeps! Fundamentals do get a little mind boggling sometimes. For instance, AUD is affected by prices of Gold and Coal (?), economic outlook from China, ASX movements, etc. How do we monitor all these all at once?
Update on my paper trading - Made 40.7 pips off AUD/USD short @ 0.75404. Exit at 0.74997. On the one day time frame, I saw the price nearing the 365 SMA, and just thought it must go down given that data coming out from Australia haven’t been all that rosy. But I wasn’t expecting it to go down so quickly. So I suppose, my win today is very much luck.
Do give tips and advices, guys. I am ever willing to learn.
Thanks!