If I have taken a trade in any currency pair and the setup is perfect based on the moving average, but suddenly news is released with a negative impact on the currency, causing the trade to reverse, how can I manage such a scenario?
There is no such thing as a perfect setup. If there was, no one would be on the other side of it to take the worst trade possible.
Enter again in the same direction if price is more favorable.
3 Likes
I usually check the economic calendar and keep a stop-loss to protect my trade and re-enter when the trend recovers.
1 Like
When a news release impacts a currency, it’s all about staying quick and focused. I’ve learned that jumping in too early can be risky, especially if you’re trading based on an initial reaction, since markets often whip around before settling. I’ve had experiences where a big report—like the NFP release; sent the USD flying in one direction, only to reverse minutes later. So, I’ve started waiting for the dust to settle, checking for confirmation after the initial spike. Patience and a clear strategy are key; don’t chase the price, but let it move a bit, then make your move once things stabilize.
1 Like
If news hits and causes a reversal, I focus on managing risk first. I make sure my stop-loss is in place to protect my account. If the market overreacts, I might give it a moment to settle, but if the move continues, I’ll cut my losses. Staying informed about the news helps me decide whether it’s a temporary reaction or a bigger shift. Flexibility and quick action are key in these situations.
It is something very common in the market and if so happens you can take a backup entry or use stop loss based on market’s trend.
I wonder if others will disagree with me, but I think you may be asking the wrong question… or perhaps just asking your question in the wrong way.
You should(?) be entering and exiting your trades based on a pre-defined rule set.
The reason why the trade went against you doesn’t matter so much as the fact that it did. Get out if your rules say so. If a valid setup presents itself right after, take it. If it doesn’t move on.
Cold hearted. Cut throat. No chasing allowed. NEXT!
I’ve heard technical-only traders say that you can always find a news event to justify price action. While I acknowledge that this is reductive and also how markets work (ironically). However, I’ve always thought the underlying point has some merit.
Specific to this post, your framing hints that you may not be using a strict rules-based trading system.
As it stands, I’m unsure what you really need to know…
- How can I learn to move on after unexpected moves ruin my “perfect” setup?
- How can I deal with the stress of fundamental news that goes against my current trade but has not stopped me out?
- Does anyone have any insights on re-entries into busted setups of the abc-strategy, especially due to unexpected news?
- Has any found any unique stop-loss placements when making trades around the time of xyz-new-events?
- Anyone have any good strategies for playing def-economic-scenario?
Or:
- Does anyone have any good rules that I can use to make my win rates more resistance to news-based volatility?
- Are there any risk management tricks I can use to improve profit factor during rapidly shifting economic conditions?
^^^This is me trying to brainstorm what your “real” question is.
You might just need an answer like:
“I don’t trade during xyz-news-event.”
Or you might need something way beyond my knowledge.
Anyway, didn’t mean to write a lecture on how to ask better trading questions but I guess that’s what it became. I get started and I just can’t stop. Sorry!
Hopefully, this helps in some way!
Imagine your trade goes against you after news hits. First, exit if your stop-loss is triggered. Wait for the market to settle before re-entering. Check the economic calendar to avoid surprises. If the setup looks good afterward, re-enter with a better entry.
1 Like