Source:Yahoo finance
Today is CPI(consumers price index) these is one piece of financial news article i don’t fancy trading at all.I prefer to be flat in the market during the period of these particular news article because it does more harm to my trading capital than good.basically they use it to wipe both side of the market.
Source:forexfactory.com
These is what i mean by wipe both side of the market.They by they i mean(traders at the pit) will move the market to where your stop and a lot of other stops surpose to be,trigger those stops to generate liquidity to dump their long or short position and the market will reverse and continue in your direction.
The above image shows what happend during friday Non-Farm Employment change aka non-farm parole.I had a perfect bear setup to go short on AUD/USD my stop was above that bearish engulfing candlesticks.The market moved pick my stop then continued in my direction for a 1:3 risk to reward ratio.
Although i re-entered the trade, covered my short position again to the downside but is not what i like doing because its not part of my trading system.so basically i think is better to stay off these two major news:Non farm parole and CPI.After all trading is all about preservation of Equity.