Being cautious during central bank meetings is important because these events often lead to increased market volatility and unpredictable price movements. Central banks, such as the Federal Reserve (Fed), European Central Bank (ECB), and Bank of Japan (BoJ), use these meetings to announce interest rate decisions, monetary policy changes, and economic outlooks, all of which can significantly impact currency values. Traders should avoid entering new trades right before a meeting unless they have a solid strategy, as sudden price swings can trigger stop-losses or lead to slippage