10 essential rules for trading Forex news profitably

Here are a few tips for you to dwell on before trading any fundamental information. 

1. Decide which piece of information you want to trade
If you want to be efficient in news releases trading system you have to find out which piece of news is the most important one. Almost every day there could be around 15 chunks of news coming from various countries. You could any forex trading dealer that provides such information and see what is coming. I choose information which is highly important and neglect news which is of low importance and most of the news which is of medium importance. 
2. Now you have to mark support and resistance levels
I base my news trading strategy on breakout of support and resistance, that’s why you have to know and mark those levels on your charts. Support and resistance are places where price came and bounced off. When high time comes you will place a buy stop above resistance and sell stop below the support. 
3. Choose forex pairs you are going to trade for the news
If you want to be successful with this trading system you have to know how to select the best candidates for your trades. You have to decide which pairs are best for you and trade only those pairs. When you look through those pairs, you have to select only those who have the best picture in terms of support and resistance levels. At the time you look at the charts the price has to be in between those levels, preferably in the middle. The best distance from support to resistance is around 80-110 pips. It could vary depending on the pair you are going to trade. Distance can be bigger for gbp/jpy pair and much smaller for eur/chf pair, because gbp/jpy is much more volatile pair than eur/chf. 
4. Now place trend lines
Technical traders know how important trend lines are in technical analysis. So, when you have decided which currency want to trade start placing trend lines. You will have to place 2 trend lines: one 5 pips below support and one 5 pips above resistance 1 or 2 hours before news announcements. Do not place your orders yet.
5. Readjust support and resistance areas
You have to be sure that half an hour before the specific news release you readjust your support and resistance levels. It is highly probable that those levels might be breached and the price is out of those channels. So, you will move a trend line higher if price is above the support and move another trend line lower if the price is below the support. 
6. Define places for orders (long and short) and also stop losses
After you readjusted your trend lines you have to decide where to place your buy and sell stops and also stop losses for those orders. Occasionally I place only buy or only sell orders as sell area or buy area is too far away. If you are a newbie I would not advise you to put more than one order in one direction (one buy and one sell order). You should place a buy stop order 5 pips above your resistance trend line and a sell stop order has to be put 5 pips below your support trend line. Now you also make a decision where to place your stop loss order. You should not risk more than 2 percent of your deposit on any given trade. It does not matter whether it is this specific strategy or any other trading system. 
7. Choose a place where you are going to take your profit 
At this stage you are very close to the news event and you have to decide where you want to exit your profitable trade (if it is going to be profitable). If you are not a newbie you can trade with two positions and close your first one at the closest support or resistance level, depending which direction market will take. I also mark even number levels (you must have noticed that).  Big boys usually take their profits there and so should we. The second position (if you take two positions in one direction) you can ride as long as the market exhausts itself. 
8. Now is the time to place orders
When 2-3 minutes are left before the release, start placing your orders, starting with the level the price is at a greater distance from the level. If the price is 20 pips from resistance and 50 pips from support you place a sell stop below support first. And vice versa, if the price is at a greater distance from resistance you place your buy stop above the level first. After that you place your second order. By now the news might be hitting the market. 
9. Readjust your open orders
When the news comes one of your orders is opened. What do you do now? You should also move your stop loss order below/above 15 minute breakout candle as soon as you can. This is how you reduce your risk and increase your profit. At this stage you also remove the order that was not opened. 
10. Exit your trades

One way you exit the market is when your take profit is reached. That’s when your platform should close your order automatically. Another way is when your stop loss is hit. If you have been moving it in the direction of the move it is in the profitable area and you exit your trade with profit. It is also possible that when news is released, you have choppy price action and your stop loss order is hit. So, you lose the amount you have pre-planned. You then wait for another opportunity to trade economic currency news events.