trade on news - good and bad sides?! I got nice free too

@lgoTr@der

Newbie
3 1
I would not trade on news. The market is not about now but the future so lot of important future news are already priced!
If you are not doing high frequency trading it sounds too risky to me.
 
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J_C_Anderson

Active member
107 15
It is quite important to understand the nature of each event and its possible impact on the market. This understanding will give trader the possibility to see the whole picture of what is going on.
At the same time, it seems that most of the news releases cause huge volatiliy during the first minutes after being announced. This means that first movements are extremely large and could have any direction. Then, after the first reaction will slow down, the real trend would appear. That is why it is better to wait for some time to be able to enter the position with the relatively low risk.
 

tomorton

Legendary member
7,205 952
It is quite important to understand the nature of each event and its possible impact on the market. This understanding will give trader the possibility to see the whole picture of what is going on.
At the same time, it seems that most of the news releases cause huge volatiliy during the first minutes after being announced. This means that first movements are extremely large and could have any direction. Then, after the first reaction will slow down, the real trend would appear. That is why it is better to wait for some time to be able to enter the position with the relatively low risk.

Great stuff, you have absolutely summed up the danger of news trading. Its possible you can get the direction and extent of the move right but be shaken out by initial volatility which is basically just noise as the major players adjust their positions and risk exposure and while our brokerage firms widen their spreads to ensure they don't have to accept unquantified risk during this period.

Its smart to follow the trend but its dumb to follow a trend which isn't there yet.
 
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FXX

Experienced member
1,140 192
I trade news all the time and it has consistently produces 10 to 20 percent a month for the last 18 months. I trade the spikes as they happen and getting the direction right is a matter of doing research, not guess work.
 
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Andy4rum

Junior member
25 2
This is great to read all comments and get some useful ideas or point of view on that trading way. Anyway, lately, focus on news mainly + some auto tools just for a fun and testing.

so, very nice - simple and powerful! See attached
can't attach zip file. sorry
page: http://www.dmurakami.com/eanews4u.htm
no email/registartion - just clear download
I'm quite happy with that tool... but want to ask some modification... first of all, since I'm out quite often - want to get it for
2-3 news... + lot2x options... since I get a loss - next trade will be with higher lot... but this is one time option - than lot gets
back to normal.

Any ideas what else may be useful?
 

Andy4rum

Junior member
25 2
Does anyone is using paid news services? Does it worth it? Get a bit faster analytics... but not sure, how helpful would it be...
 

Andy4rum

Junior member
25 2
Plenty of news almost daily to make money off.
Hey

Did you try this tool or you are totally ignore news opportunities? I know, that many traders do that... like with Martingale - some traders like, some just ignore.. we are all different - that's great :)