The founder of the theory of stock trading, Charles Dow, discovered the postulate about the influence of any news and events on market quotes. And while it is impossible to predict the outcome of leaders’ meetings and negotiations, the release of economic news always has a predetermined schedule and a quite predictable result.
The data of news events are published in economic calendars, which is a table that reflects: time of release, currency, title of news and its preliminary and actual value.
Many online resources provide this kind of information, but the ForexFactory portal is considered one of the best news providers. That’s why our news indicator – “Altra FF News” is based on this particular calendar.
The “Altra FF News” indicator is rather simple: the trader sees in the Metatrader4 window the next two news with a countdown timer and a mark about their importance.
With the “Altra FF News” indicator, you don’t need to set reminders after the morning market analysis because it serves as a “fundamental alarm clock” during the day. It additionally notifies the trader about the imminent publication of any statistics.
Indicator Inputs
- ReportAll (currency pair) – the option has two values: true / false, which enables / disables statistics for a particular currency;
- ShowNextTwoEvents – displays two news, the default is true (enabled);
- ShowVertNews – vertical line, appears during news release, disabled by default;
- Txt – five parameters for setting the font size and color range of the text notification placed in the chart window;
- VertTxt – six settings for the coordinates of the location of the text on the chart.
How to use the indicator
The results of economic news have a known in advance influence on the quotes of national currencies, shown in the Altra FF News indicator as high or medium, – high or medium importance of news. This helps to accurately predict the spike in volatility, which allows day traders to:
- Close positions in advance and do not trade during the news release;
- Close orders with minimal profit.
A surge in volatility will reach Stop Losses that are not set large within the day, regardless of whether the news was in the direction of an open trade or against – important news, as a rule, causes a spread of quotes in both directions.
If the trader is confident in the direction of the news momentum, and it coincides with the current trend, he can increase the stoploss size at the time of the news release, but this is an extremely undesirable option. The reaction to news is always unpredictable and can reverse quotes even if the data “favorable” for a particular currency is released.
Conclusion
The “Altra FF News” indicator will be useful for any trader with any brokerage. Refusing to watch the news is like living without a clock at home. It can increase the profitability of any trading system if a trader takes into account news events and avoids unnecessary triggering of stops due to a jump in volatility during the release of important news.
P.S. Have problems with installation? Email me at olivermurphy@altraforex.com or support@altraforex.com
I would love to help!
Thank you, Oliver, for sharing helpful tools of yours for free!