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how about news trading, can it work?

  • #21
  • Mar 28, 2009 12:04pm Mar 28, 2009 12:04pm
Quoting billye
talking about several day direction I was not so sure. in news trading I was actually meaning enter and exit within 1 hour like that.

it's true that the highs this week has tested support level many times this week..

but the real triggering thing that sends for a break was Friday's GBP GDP q/q bad right?

I have not been able to read a volume data from forex so no idea yet, maybe I can learn
is there a source we can get that forex pair trade volume data electrically? thanks malcocmb.

I use esignal ...... but ibfx mt4 platform is fairly close .... on news watch for high volume up bars ... pros will sell into these . Market does not like high volume wide spread up bars out of nowhere. Look back in your charts at news time and try to spot these ... there is always a selling reaction to them.

that is one thing news is good for .. on bad news market will mark down prices but I always look for pros to buy into the weakness. Using vsa I can say when I am right my max draw down is 30 pips on gj , more than this and the trade is liekly not going to work , and i get out wait for next trade
Blogging daily now at www.volume.zone
  • #22
  • Mar 28, 2009 12:44pm Mar 28, 2009 12:44pm
thanks malcolmb, does ibfx demo mt4 have same volume data?? I will take a look.

I'm already opening 2 window mt4 + fxtrade for place order
... try to make things less complicated

what does buy into weakness mean?
meaning the trend push meet little resistance?? so keep pushing that trend will be good?

Quoting malcolmb14
I use esignal ...... but ibfx mt4 platform is fairly close .... on news watch for high volume up bars ... pros will sell into these . Market does not like high volume wide spread up bars out of nowhere. Look back in your charts at news time and try to spot these ... there is always a selling reaction to them.

that is one thing news is good for .. on bad news market will mark down prices but I always look for pros to buy into the weakness. Using vsa I can say when I am right my max draw down is 30 pips on gj , more than this and the trade is liekly...
  • #23
  • Mar 28, 2009 2:20pm Mar 28, 2009 2:20pm
Quoting billye
thanks malcolmb, does ibfx demo mt4 have same volume data?? I will take a look.

I'm already opening 2 window mt4 + fxtrade for place order
... try to make things less complicated

what does buy into weakness mean?
meaning the trend push meet little resistance?? so keep pushing that trend will be good?
it means if you see a wide spread down bar ( most think this is going to keep going down and will sell into it ) with high volume , then the next candle there is a really high volume doji on a pivot low , this is pros buying at value on the weakness
Blogging daily now at www.volume.zone
  • #24
  • Mar 28, 2009 4:48pm Mar 28, 2009 4:48pm
the problem with news releases is that people WAIT for the release instead of watching the market TELL them what to expect !

Like stocks, where the news is "priced in", its a simple fact of life to understand what the price shall do, and where it will go and while I'm NOT a news trader per se, invariably im working the market when it comes out, so its a natural for me.

essentially, if the news is going to be GOOD, the price is MOVED DOWN all nite long, the price will continue down even after the release of the GOOD news for usually 1/2 hour and/or the time it takes to reach the H4 bottom support area.

ONCE this happens, the price will REVERSE to the upside UNLESS there is a reason to keep dropping it, which you can plainly see on the attached chart.

you may discuss this news phenomenon forever, but i simply go about making profits and laugh at discussion ----- ENTER BEFORE THE NEWS and set a TP POINT and news WORKS, try to catch it on the run, and you fall flat on your face, BECAUSE THE NEWS IS ALREADY PRICED INTO THE NEXT MOVES !

this simple concept has been a part of trading anything for far more years than any of us has been around, and if you use it you wont have to re-invent the wheel, so just WATCH and then talk about what youve seen and done, while you count the pips youve gotten.

Btw, although i dont do it intentionally, you will ALWAYS find that the news will move the price out of its current trend, and you will find that it INEVITABLY returns right back to its trend line, the same day, the next day, or by the end of the week, depending on a number of variables that are learnable.

BUT PLEASE ---- dont state to the world that you cant make money on news as there are far too many people making extremely large profits.

It only requires you to WATCH and SEE and then REMEMBER for the next time !

enjoy and trade well

mp


Quoting malcolmb14
Billy I know you are putting a lot of thought into this and trading the news seems like an easy way to make money and I know there are services out there that say they make 70 pips on this news annoucement and 50 pips on that one ... the issues are

1) can your platfrorm fill you fast enough
2) can your platform gee you out of trade fast enough
3) what if gu moves 50 pips in 5 seconds , you get 50 pip of lsippage ( it happens) and then price reverses 100 pips.

I would suggest if any of these news services are trying to sell you something .. ask...
  • #25
  • Mar 28, 2009 9:57pm Mar 28, 2009 9:57pm
Quoting mparker
the problem with news releases is that people WAIT for the release instead of watching the market TELL them what to expect !

Like stocks, where the news is "priced in", its a simple fact of life to understand what the price shall do, and where it will go and while I'm NOT a news trader per se, invariably im working the market when it comes out, so its a natural for me.

...

It only requires you to WATCH and SEE and then REMEMBER for the next time !

enjoy and trade well

mp
Thanks mparker!

I do believe that news trading is releatively simple.

I'm quite new in that. Could you please give me sort of clear steps through this system that beginner can understand as well?

Also, if you can send/email me links to where it's well explained alternatively. it would be truely appreciated.

Thanks.
  • #26
  • Mar 28, 2009 10:13pm Mar 28, 2009 10:13pm
Honest

not for nothing, but i pretty much explained it all --- theres some more info, although repetitive, over on my thread at MP --- 350 pips daily and all the ice cream you can eat" but its actually a closely held secret and little has been said about it, rather more what you read below --- how HARD it is !

enjoy and trade well

mp


Quoting PipPicker
Thanks mparker!

I do believe that news trading is releatively simple.

I'm quite new in that. Could you please give me sort of clear steps through this system that beginner can understand as well?

Also, if you can send/email me links to where it's well explained alternatively. it would be truely appreciated.

Thanks.
  • #27
  • Mar 29, 2009 12:16am Mar 29, 2009 12:16am
Quoting mparker
the problem with news releases is that people WAIT for the release instead of watching the market TELL them what to expect !

Like stocks, where the news is "priced in", its a simple fact of life to understand what the price shall do, and where it will go and while I'm NOT a news trader per se, invariably im working the market when it comes out, so its a natural for me.

essentially, if the news is going to be GOOD, the price is MOVED DOWN all nite long, the price will continue down even after the release of the GOOD news for usually 1/2 hour...

good luck trading news I know there are traders out there that make money off it or so they claim. Most of the time I just see emails on how great this news trading service does or that news trading service , but when I send an email back asking for account statements / proof I get some kind of excuse why they cannot give it to me .. even demo account

I know when news is coming out and if not locked in profits I avoid entering new trades around it. It was has kept me profitable for the last 4 years.

I mean there are hundreds of pips to be made everyday even trading one pair like gj , I do not have to use high risk news time to make a few pips. I agree though most of the time news has been factored in .

I tend to ignore most news items myself . I just trade the charts and let the volume and price action tell me what is going on
Blogging daily now at www.volume.zone
  • #28
  • Mar 29, 2009 12:28am Mar 29, 2009 12:28am
hi, malcolmb14:
yes, I agree that if I'm doing simply 10pips scalping, definitely will exit before news due to it's uncertainty.

here we're discussing if a dedicated style of news trading is possible.

we especially see lots of this discussion on fpa to judge how a broker supports news trading, so my assumption is there is still some meat to eat out of.

other thing is, be trained to play news only,
will be a skill useful when doing some other trading and a news event is coming, we can judge if it's major or minor news or if it's going to change the trend completely.
this will be especially useful for small scalpings and small bounce-off tradings, in which scenario a news coming can knock me out of the stop/loss.

Quoting malcolmb14
I know when news is coming out and if not locked in profits I avoid entering new trades around it.

I tend to ignore most news items myself .
  • #29
  • Mar 29, 2009 12:32am Mar 29, 2009 12:32am
mp stated on thing about news .. do not wait for the news to get into the trade .... that is the right way to lose money

here is a prime example .... yes the 80 pips candle looks attractive and some likely say they could have traded it but i bet it happened in 10 seconds or less and news traders slppage would have been 30 - 50 pips , meaning they had 30 pips to get out before they lost money.

In reality the high vol up bar was actually pros selling into the strength on news and provided a very nice 140 pip trade to down side.

It is not knowing what news will do to drive the market , but knowing how the pros play and work the market that will make one large amounts of pips in this game

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  • #30
  • Mar 29, 2009 12:34am Mar 29, 2009 12:34am
hi, mp:

I agree that if the news leak before announcement, the move will be achieved before news announce and to it's full effect, and when announce, it can go the opposite of how good or bad the news mean.

the uncertain thing is whether it will leak each time.

also for minor data release, it don't have to reverse a major trend I guess?

Quoting mparker
the problem with news releases is that people WAIT for the release instead of watching the market TELL them what to expect !

Like stocks, where the news is "priced in", its a simple fact of life to understand what the price shall do, and where it will go and while I'm NOT a news trader per se, invariably im working the market when it comes out, so its a natural for me.

mp
  • #31
  • Mar 29, 2009 12:38am Mar 29, 2009 12:38am
well, im not a news trading "service' by any stretch of the imagination, but ive seen ones that are completely correct in what they state, and as i said, while i dont go LOOKING for news, im invariably trading during that period, so i naturally get involved.

one difference with me is i WILL show you my trades during news as theres nothing to hide from anyone !

News is feared by many, mostly by being told its to be feared and while it DOES take some time to figure how to make pips on it, with the amount of news being released these days, how can one stay out of the market when the trading day is so influenced by those 8:30 am edst releases ? You HAVE to be caught in it one way or another !

mp


Quoting malcolmb14
Most of the time I just see emails on how great this news trading service does or that news trading service , but when I send an email back asking for account statements / proof I get some kind of excuse why they cannot give it to me .. even demo account
  • #32
  • Mar 29, 2009 12:38am Mar 29, 2009 12:38am
oh, seems slippage is a problem.

Quoting malcolmb14
here is a prime example .... yes the 80 pips candle looks attractive and some likely say they could have traded it but i bet it happened in 10 seconds or less and news traders slppage would have been 30 - 50 pips , meaning they had 30 pips to get out before they lost money.
  • #33
  • Mar 29, 2009 12:41am Mar 29, 2009 12:41am
I think it's better be trained for news trading alone to be at least break/even (ignore spread/commission cost)

so that we don't have to exit each time a minor data coming...

or if one thing that's really significant like rate reduction or Fed print money or GDP announcement... we will be informed to keep away from the risk.

Quoting mparker
well, im not a news trading "service' by any stretch of the imagination, but ive seen ones that are completely correct in what they state, and as i said, while i dont go LOOKING for news, im invariably trading during that period, so i naturally get involved.

one difference with me is i WILL show you my trades during news as theres nothing to hide from anyone !

News is feared by many, mostly by being told its to be feared and while it DOES take some time to figure how to make pips on it, with the amount of news being released these days, how...
  • #34
  • Mar 29, 2009 12:43am Mar 29, 2009 12:43am
Quoting mparker
well, im not a news trading "service' by any stretch of the imagination, but ive seen ones that are completely correct in what they state, and as i said, while i dont go LOOKING for news, im invariably trading during that period, so i naturally get involved.

one difference with me is i WILL show you my trades during news as theres nothing to hide from anyone !

News is feared by many, mostly by being told its to be feared and while it DOES take some time to figure how to make pips on it, with the amount of news being released these days, how can...
I am a VSA trader .... I use news alot to trade as pros buy into weakness and sell into strength . If I see a high vol up bar on news with little follow thru at areas or previous resistance I know that pros are selling into the strength , as noted on last chart ,. The oppsoite for buys as price may be marked down on bad news , enticing the pros to buy at the discounted value.

so news does have its uses .

I am not scared of it .. just know when it is coming and manage my trades accordingly.
Blogging daily now at www.volume.zone
  • #35
  • Mar 29, 2009 12:44am Mar 29, 2009 12:44am
all i can say is WATCH and keep watching --- after a few years you might gain some confidence !

and its not a matter of "leaks", although im sure there are some, but because the banks KNOW what is to be announced because they have researchers paid BIG BUX to know this information, and its rare they are fooled because theres just TO MUCH at stake.

you wont see it on a brokers charts, but if youre receiving a feed from Barclays or even a tier 2 liquidity provider, you will CATCH a move milliseconds BEFORE the news release as someone jumps the gun and they could ONLY jump the gun if they already knew !

There is SO MUCH out there that retail traders DONT know, including myself, but I try as hard as i can to let some of the truth hit peoples minds.

mp

Quoting billye
hi, mp:

I agree that if the news leak before announcement, the move will be achieved before news announce and to it's full effect, and when announce, it can go the opposite of how good or bad the news mean.

the uncertain thing is whether it will leak each time.

also for minor data release, it don't have to reverse a major trend I guess?
  • #36
  • Mar 29, 2009 12:45am Mar 29, 2009 12:45am
meaning when news move price down by 100pips in a sudden and stop there, then buy into it? isn't it risky if it's just meeting a resistance and rest for a while?

or if at this moment, watch for volume and spread go low, that will tell the trend stops moving ahead and reverse?

Quoting malcolmb14
it means if you see a wide spread down bar ( most think this is going to keep going down and will sell into it ) with high volume , then the next candle there is a really high volume doji on a pivot low , this is pros buying at value on the weakness
  • #37
  • Mar 29, 2009 12:54am Mar 29, 2009 12:54am
Quoting billye
meaning when news move price down by 100pips in a sudden and stop there, then buy into it? isn't it risky if it's just meeting a resistance and rest for a while?

yes and no ..all trading is risky, However often volume is like a story . If a price moves down 100 pips on high volume and stops , or better yet gets a long wick on the candle it shows pros are buying into the weakness.

attached chart below the pivot low had high volume after a move down , the high volume candle was a small doji candle. and on whole number. That to me says that buyers are at 139 , a long with 30 pip stop is all that is required. This is the kind of set up you may see on a news annopucement.

also I let volume tell me where buyers and sellers are ... note the volume histogram......light blue line is upper 70 % of volume and green lines at 139.80 is lower 70 % ile of volume ..... 140.03 is high volume pivot of 3 days ago and whole number. There is no guessing where the buyers and sellers are

often price will range between these two values of volume ....

also watch in news time how often a high volume wide spread up candle will reverse on next candle , or if price is marked down how often it will reverse to upside. This is what most news traders do not get ... they are mostly looking for the fast buck at the news time , rather than waiting for the easier , less risk fast buck 5 minutes after news.

If you follow the vsa thread that I belong to run by shamus you will see there is an irc chat room (free) I foten go in there and talk about my trades as I take them , as do many otehr great vsa traders

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  • #38
  • Mar 29, 2009 1:10am Mar 29, 2009 1:10am
thanks malcolmb for the detail explanation.

I think I got what you mean for high volume and wide spread candle reverse on next candle.

for a few terms you mention I still did not catch it, maybe I will find a time to learn about vsa... it seems a useful info in addition to what we got from price numbers.

Quoting malcolmb14

also watch in news time how often a high volume wide spread up candle will reverse on next candle
Attachment
  • #39
  • Mar 29, 2009 1:19am Mar 29, 2009 1:19am
ill tell ya malcolmb

you could sure use a decent set of s+r overlays and a bols or two and youd NEVER have to figure whose buying and selling what, especially for those who use a broker and are not privy to bank info.

a method, which has certain merits contained within itself, but not used by me, is a straddle trade just before news is announced, when NOTHING is doing much in the way of slippage or spread increases --- based on the simple fact that the price will go one way for half an hour and then reverse and continue that way for either half or all of the day, it works and works well. although i know which way the price will move in the beginning by simply watching what direction the market moves prior to the news release, it provides a ready made solution to those who want to cover their bases.

Assuming the price shoots up, you have made that trade in quite times and entered a tp based on time and momo. Now your price is hit and you watch for the next move, which if youve timed it right will be a complete reverse of direction, which is now covered by the remaining piece of your straddle trade --- in fact, you can even average up, increasing your move to the downside tremendously ---- even if you get in early, you KNOW the reverse has to happen because it ALWAYS happens, so you simply sit back and wait as the price drops, taking scalps on the way down if you so desire, but already having your short in place for a long time.

in no way do i endorse this procedure, but one look at any chart will tell you it works and works well.

just another way of trading and one doesnt even need to know volume or candles.

enjoy and trade well

mp
  • #40
  • Mar 29, 2009 10:45am Mar 29, 2009 10:45am
Quoting mparker
ill tell ya malcolmb

you could sure use a decent set of s+r overlays and a bols or two and youd NEVER have to figure whose buying and selling what, especially for those who use a broker and are not privy to bank info.

a method, which has certain merits contained within itself, but not used by me, is a straddle trade just before news is announced, when NOTHING is doing much in the way of slippage or spread increases --- based on the simple fact that the price will go one way for half an hour and then reverse and continue that way for either half...

yup those straddle trade are a way to trade news .... never been a fan of them myself , as price can move up 100 pip , catch the long straddle trade then whipsaw back down stop that ine out fill the sell stardlle trade , then whipsaw back up , happened in gj last week ... 3 x 100 pip 5 min candles ... could not get into a trade ... so I just let market settle down and then waited for volume to tell me what was going on and sold her for a 200 pip trade in US session

thanks for the bollinger bands info , I have used keltner bands before that were ok .... I like volume though ... I use both vsa and volume foorptint in ninja trader. Nothing like it. Often I can get into trades on gj with max 20 pips drawdown for 50 - 100 pips trades. There are many ways to skin a cat

by the way check out EJ daily bollinger bands 2 standard deviations 21 .... good time to sell about now for 500 pip trade .
Blogging daily now at www.volume.zone
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