To trade on Forex news, you should follow the economic calendar where all major world financial news are collected. Also, the calendar shows the time of the news release and the strength of its impact on a specific currency pair.
News trading is the strategy which is based on a fundamental analysis. News traders make profit on the price gaps at the moments of important economic news releases.
There are two approaches:
- Traders foresee the direction of movement and the possible reaction of the market to the published news and place orders before the release in the direction where the price is supposed to move.
- Traders wait for the news release and watch the reaction of the price. Thus, traders monitor the price behavior, and then enter the market.