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The Importance of Exiting Trades Before Economic News Events

In my trading approach, simplicity and predictability come first. I trade a mechanical Double Top/Double Bottom strategy using pending orders, fixed risk, and fixed rules — and nothing disrupts clean, predictable trading faster than a major economic news release.

Economic news events inject sudden information into the market. That information creates fast, erratic movements that have nothing to do with structure, price action, or the patterns I trade. Because of that, I always exit trades before high-impact news and avoid placing new trades anywhere near them.

Here’s why.

What Counts as an Economic News Event?

These are scheduled releases from central banks and government agencies that instantly change market expectations. A few examples include:

  • Non-Farm Payrolls (NFP)
  • Interest rate decisions (Fed, ECB, BoE, BoJ, etc.)
  • Inflation data (CPI, PPI)
  • GDP releases
  • Retail sales
  • Central bank speeches
  • High-impact surprise announcements

These events can move currency markets more in 60 seconds than a clean pattern might move in hours.

Why News Events Are a Problem for Pattern Traders

1. They Create Chaotic, Unstructured Price Action

The DT/DB pattern depends on:

  • the boxed candle
  • the re-entry
  • the neckline
  • the clean break

Economic news destroys all of that. Structure vanishes instantly and price moves based on new information, not technical behaviour.

A valid pattern one minute can become completely invalid the next.

2. Slippage and Spread Widening

During high-impact news:

  • spreads widen massively
  • pending orders can trigger at terrible prices
  • stop-losses may fill far from where you set them

Even with perfect analysis, your order can go wrong simply because the market becomes untradeable.

This alone is enough reason to avoid trading through news.

3. Liquidity Drops

Many traders exit early before news. Market makers pull back. Liquidity dries up.

Low liquidity means:

  • wild spikes
  • erratic gaps
  • unpredictable fills

This is the opposite of the calm, mechanical environment this strategy is built for.

4. Market Reactions Are Often the Opposite of What the “Logic” Suggests

Even if the news is “good” or “bad”:

  • the initial move might reverse instantly
  • large candles may whip up and down
  • price may break a neckline by 30 pips and then snap back

No amount of technical analysis predicts this.

Why I Always Exit Before News

1. Protecting Capital

Mechanical trading only works when:

  • stops are respected
  • risk is predictable
  • entries are clean
  • exits are controlled

News destroys all four.

By closing trades before news, I protect my capital from chaotic moves that have nothing to do with the strategy.

2. Keeping Results Predictable

This strategy works over time because:

  • entries trigger cleanly
  • stops and targets behave predictably
  • spreads remain normal during liquid sessions

News breaks every one of those conditions.

Avoiding news keeps the strategy functioning exactly as designed.

3. Staying Emotionally Steady

Trading into news:

  • triggers fear
  • creates second-guessing
  • leads to interference
  • encourages breaking rules

Exiting ahead of news keeps trading calm, controlled, and stress-free.

Check it out on Amazon.com

Check it out on Amazon.com

How I Handle News Events in My Trading Routine

1. I Check the Economic Calendar Every Morning

I note:

  • the time
  • the currency affected
  • the expected impact (medium/high)

If a major release is close to my setups, I simply do not place the order.

2. I Delete Pending Orders Ahead of News

I never let a pending order sit near high-impact news.
The break can be fake, violent, or completely chaotic.

If news is approaching, the order comes off.

3. I Close All Open Trades Before High-Impact Releases

Even if a trade is nearly at target, I close it.

The goal is stability, not squeezing a few extra pips.

4. I Resume Trading After the Market Settles

Usually:

  • 15–30 minutes after the release
  • spreads tighten again
  • structure begins forming normally

Only then do I return to scanning for clean DT/DB setups.

Major News Events I Always Avoid

  • NFP
  • Interest rate decisions
  • CPI / PPI
  • GDP
  • Unscheduled central bank statements
  • FOMC press conferences

If it has a red flag on the calendar, I’m out.

Final Thoughts

Trading through news events isn’t part of my strategy, and it never will be.
This method relies on calm, structured charts — not explosive, unpredictable news-driven moves.

By exiting early and staying clear of major releases, I keep my results:

  • mechanical
  • calm
  • consistent
  • predictable

And that’s the whole point of the strategy.

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