Trading the major news is very tough. Those who have strong knowledge about the market often become confused about their actions and fail to do the data analysis during the high-impact news. Even after having strong technical knowledge, you might fail to make a decent profit during the news release hours. How do professional traders make money during news hours? Well, the elite traders have mastered the art of the news trading process. They know the proper way to deal with the market volatility and make a consistent profit without having any hassle.

In this article, we are going to teach you the exact you trade the major news. Follow the tips carefully and you will be able to trade the high-impact news. 

The severity of the news

Before you start trading the major news, you need to understand the severity of the news. If you assess the Forex economic calendar, you will notice that the news is divided into three major groups. The low impact news is usually ignored by the retail traders as it doesn’t have any impact on the asset’s price movement. Things become challenging when you start to deal with the medium impact news. The market becomes volatile right after the release of such news but usually, the trend remains the same. Finally, we have high-impact news and anything can happen after such a news release. Based on the severity of the news, you should take the mental preparation to take your trades.

Trade the medium impact news

At the initial stage, you should not try to trade the high-impact news. Try to develop a simple news trading strategy in the demo account offered by Saxo and trade during the medium impact news. Stick to the demo trading account as long as you need but make sure you get comfortable by trading the medium impact news. Usually, the trade signals are formed in the 30-minute time frame right before the news release. Ignore the trade signal when the price is away from the major support or resistance level. Always remember, no matter how severe the news is, you should always take your trades near the critical support or resistance level.

Trade the high impact news

After gaining some basic skills, you may start trading the high-impact news in the demo account. To deal with the high-impact news, you need to use the price action confirmation signal. Once the news is released, wait for the price action confirmation signals in the lower time frame. Unless you trade the market with the help of a price action confirmation signal, you will never know the perfect place to set your stops. Always use protective stops in the market as it will keep your fund safe.

Learn multiple time frame analysis

Being a news trader, you need to be good at multiple time frame analysis. Without having the skills to analyze different time frame data, you will never learn to filter out the bad trade signals. It might take a while to get used to the whole concept of multiple time frame analysis. However, you still, you need to master it. While using the multiple time frame analysis processes to filter out the trades, give priority to the higher time frame data. By doing so, you can avoid many false trade signals in the market.

Take 1% risk in each trade

Professional news traders always trade with a very low-risk profile. They never risk more than 1% of their account balance since they know the outcome of the trades is completely random. As long as you trade the market with strict risk management rules, you should not have many problems with your trading profession. At times, you might have to lose a few trades in a row, but consider those as part of your business costs.