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News Trading

  • #1
  • First Post: Jun 28, 2009 1:38pm Jun 28, 2009 1:38pm
Hi every one can you tell me please i am planning to trade the news as soon as it comes bad or good news for the currency my question is how long the news will take time to affect the currency so that i can enter into trade .....or what are the main news by which i can get more profit..
  • #2
  • Jun 28, 2009 7:15pm Jun 28, 2009 7:15pm
Quoting zubair
Hi every one can you tell me please i am planning to trade the news as soon as it comes bad or good news for the currency my question is how long the news will take time to affect the currency so that i can enter into trade .....or what are the main news by which i can get more profit..
Trading fundamentals (news) is not an easy tactic even for the most experienced traders, a lot of traders will warn you off because of the inherent event and execution risks. You really need to be on top of your game to make trading fundamentals pay and not lose your shirt, it's not at all easy even though it looks like a fast buck.

Having said that, there is absolutely no reason not to trade some of the most potentially profitable market-moving events........as long as you understand the increased risks and manage them carefully.

Try and avoid the numerous e-books out there with titles like "News trading made easy" etc etc, there's plenty of free information available from reputable sources.

Here's some interesting reading to get you started, written by Kathy Lien and Boris Schlossberg (both ex-FXCM currency strategists)


http://www.investopedia.com/articles...dingOnNews.asp

http://www.investopedia.com/articles.../04/031704.asp

http://www.investopedia.com/articles...damentally.asp


If you're not completely familiar with trading news then spend plenty of time either on demo or trading extremely small positions, and don't expect the same kind of execution with normal size positions!
  • #3
  • Jun 28, 2009 10:09pm Jun 28, 2009 10:09pm
I recommend you this: http://www.amazon.com/Sentiment-Fore...6244894&sr=1-1
The fact is, even pros have trouble trading the news.
  • #4
  • Jun 28, 2009 10:37pm Jun 28, 2009 10:37pm
The fact is, pros don't trade the news. It's that simple.
  • #5
  • Jun 28, 2009 10:57pm Jun 28, 2009 10:57pm
I was digging around in my "its your luck day" archives and found this..

http://www.forexfactory.com/showthread.php?t=4734

You might recognize some of these posters
It's me...
  • #6
  • Jun 28, 2009 11:20pm Jun 28, 2009 11:20pm
Quoting Xaron
The fact is, pros don't trade the news. It's that simple.
???
  • #7
  • Jun 29, 2009 4:15am Jun 29, 2009 4:15am
Quoting Quantum4x
???
Let me explain. By news trading I mean this "trading within the news announcement" where you typically see wild spikes in both directions.

Pros are positioned before news. A single news usually don't change the underlying fundamental trend so if it goes in the opposite direction of the underlying trend it's just a good dip buying.
  • #8
  • Jun 29, 2009 6:50am Jun 29, 2009 6:50am
Exactly.
You don't see a pro chasing tops and bottoms with the spikes. A position is open before the explosion.
I've talked with some that do some casino chasing, but that requires incredible skills. At least I could't do it.

Quoting Xaron
Let me explain. By news trading I mean this "trading within the news announcement" where you typically see wild spikes in both directions.

Pros are positioned before news. A single news usually don't change the underlying fundamental trend so if it goes in the opposite direction of the underlying trend it's just a good dip buying.
  • #9
  • Jun 29, 2009 6:58am Jun 29, 2009 6:58am
Quoting zubair
Hi every one can you tell me please i am planning to trade the news as soon as it comes bad or good news for the currency my question is how long the news will take time to affect the currency so that i can enter into trade .....or what are the main news by which i can get more profit..
Zubair,

Finding a system/method that suits your personality and applying good money management will keep you out of trouble.

You want to get to a point where you are trading profitably and not trying to catch a falling knife or rising bullet.

Z

Congratulations on your first post.
  • #10
  • Jun 29, 2009 9:31am Jun 29, 2009 9:31am
Quoting Xaron
Let me explain. By news trading I mean this "trading within the news announcement" where you typically see wild spikes in both directions.

Pros are positioned before news. A single news usually don't change the underlying fundamental trend so if it goes in the opposite direction of the underlying trend it's just a good dip buying.
If I am not wrong PRO means bank dealers and hedge funds. So if they are not creating those huge moves who are those traders who move the market by such a large scale. I don't think retail traders have this capability
The only way to get smarter is by playing a smarter opponent.
  • #11
  • Last Post: Jun 29, 2009 9:34am Jun 29, 2009 9:34am
Quoting NewFX
If I am not wrong PRO means bank dealers and hedge funds. So if they are not creating those huge moves who are those traders who move the market by such a large scale. I don't think retail traders have this capability
It's just the lack of liquidity during news time which creates such spikes. Imagine that the order book around important news is very dry, maybe some limits here and there to protect positions...

So if the next possible price in the book is, let's say, 20-30 pips away, you have a nice spike.
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