Hello ladies and gentlemen it is another day and another post that will make you understand in deep how you will make money during news release ,here we are going to elaborate how you can trade these fundamental event and why it is important to deal with these events,
As we said on part one that we have two method of dealing with these fundamental event and these method are ;
1,Technical analysis
2;Statistical method of data analysis
HERE we are going to deal with technical analysis as it is simple way to understand compared to that of statistical method of analysis ,
Technical analysis here deals with different strategy but mainly you have to start with price action (PA) then you can use other method for more confirmation , you can use INNER CYCLE TRADE (ICT) and here we mostly prefer the use of order block (OB), fair value gap (FVG), breaker block (BB) and sometimes we use mitigation order block (MOB) , These area are called area of value this is because all professional trader are set their orders there whether sell or buy on these are, worry not we will teach all ICT content on this sight now let us proceed with news analysis ,
In price action we learn how to use pattern on trading and these pattern are very important during news analysis and during news trading, there are different pattern that you should understand it before starting trading example of these pattern are;
1;triangle formation both contracting triangle, barrier and expanded triangle
2;flat formation, here we have normal flat, expanded flat and running flat
3;diagonal formation we have two diagonals, leading diagonal and ending diagonal
4; the formation of truncation
If you want to understand these patterns on how it is formed and how it is used you should learn WAVE PRINCIPLES there are the features of these patterns and are elaborated on how they drives market
Now after understanding these Tips let us focus where you should start when there is news on that trading day, we will start with USD NEWS ANALYSIS;
Here on USD news trading we focus USD index and USD pair on the structure that are made before the release of news , here you will see these patterns mentioned above, as you should understand that news are there to support technical analysis here you should know that market do three things per day ;
1;Accumulation sometimes knows as consolidation, and this mostly occur during Asian session which approximately it is 01:00 Mid night for East African time
2;Manuplation, this mostly this occur during London session always it is against the yesterday motive wave , that is why people says London is for manupulation time look the chart drown bellow
3;Distribution ,this mostly occur during NEWYORK session here market flows in the direction of trend , either starts new level or continue to other level that are yet made
Now see the structure below
The market should form these features per day, NOW what we should know is that, The fundamental event is there to do two things and one of these two thing should be done , Fundamental can do manipulation or Distiribution ,
Ladies and Gentlemen here is where you can start analysing USD news , here you should now that these news make USD to be strong or weak in the market , to understand where USD is going to be weak or strong you should deal with DXY which is and index of USD ,if you notes DXY has got bullish setup (pattern) this implies that USD is going to be strong and here means USD bases will be buying and USD quotes will be selling ,
The analysis will be done strongly where the multiple time frame analysis will be the best ,here these analysis will help you to understand where the market will be going basing on the patterns of different timeframe , then before ten minutes of fundamental release you should notes which pattern are being formed or sometimws are yet formed to notify you where the direction of the market to be going.
For example look on the structure below;
IF you see on the chart above you notes that the market is in bullish flag , this implies that If there is 10 to 5 minutes remain before event to be released that the USD is going to be strong this is because its index shows bullish pattern
Now look on the chart below after the event;
On above chart shows that the fundamental events respect the formed pattern and these chart shows that the USD is strong during the fundament release , here we can see that EUR/USD selling while USD/CHF will be buying
look on an example below on EUR/USD before and after fundamental event
1;before news release;
As we expected after looking on DXY that USD is going to be strong then if we come up on EUR/USD become supportive as it has also bearish structure that simplifies our view on fundamental event before release,
2;then look on the chart below after news release what was going on;
Now you can see the chart above there was free money there during the event it was only to smash the market then after you widen your bank account
Then look on USD/CHF because DXY has bullish setup this means that even USD/CHF should have bullish setup , now let us see on the example below before and after the release of that fundamental event
1, Before the release of fundamental event;
Now you can notes on these structure , these are two different structure on DXY and on USD/CHF but they have same use , here we mean these two setups are bullish setup.
2,Now look on the chart below after the release of fundamental event;
Ladies and Gentlemen now you have something on you mind on how you can deal with fundamental event on USD pairs and these are based on technical and this is only a part two
............... SEE YOU ON THE NEX PART THREE.......
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