Breaking news is interfering with my trading | Forex Factory

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Breaking news is interfering with my trading

  • #1
  • First Post: Mar 20, 2013 8:42am Mar 20, 2013 8:42am
I noticed that in some occasion the breaking news cause a price spike which disrupts my scalping system.
Now I don't want to bitch around but I think this is clearly unfair. If there is a breaking news
which is good for EUR and I was with a limit order to sell, all the others are going to abandon
the ask side of the book, and guess who gets filled, the uninformed trader...
This causes more losses than gains, because if it was the opposite (bad news for EUR) the informed traders would
place sales in front of me..., so I can't just get away with 50/50 chance, it's actually a 100% lose chance.

The price spike happens minuts before the news is officially out through standard news feeds,
so I suspect richer traders have faster feeds (Reuters?).
Obviously someone else bigger is getting to know things before the retail trader
And I am not talking about "scheduled" news, by which I can at least avoid to be exposed.

Maybe I have some expert thoughts about this and maybe a solution , thanks.
  • #2
  • Mar 20, 2013 9:32am Mar 20, 2013 9:32am
Set stop-loss and trade using pending orders?
  • #3
  • Mar 20, 2013 11:02am Mar 20, 2013 11:02am
Quoting enivid
Set stop-loss and trade using pending orders?
???
  • #4
  • Mar 20, 2013 4:44pm Mar 20, 2013 4:44pm
Nobody ever said the markets were supposed to be fair. People use whatever advantage they can get to make money off of each other - there isn't anything you can do about it.
  • #5
  • Mar 20, 2013 5:44pm Mar 20, 2013 5:44pm
Quoting Marzullo
I noticed that in some occasion the breaking news cause a price spike which disrupts my scalping system.
Now I don't want to bitch around but I think this is clearly unfair. If there is a breaking news
which is good for EUR and I was with a limit order to sell, all the others are going to abandon
the ask side of the book, and guess who gets filled, the uninformed trader...
This causes more losses than gains, because if it was the opposite (bad news for EUR) the informed traders would
place sales in front of me..., so I can't just get away with 50/50...
Us retail traders are the bottom feeders of the FX world. We do the best we can with what we have.....and no one ever said that everyone was going to play 'fair'.....it's a dog eat dog world out there, and the all we can do is to smile and carry on when things don't go our way.
Doing what you like is Freedom. Liking what you do is Happiness.
  • #6
  • Mar 20, 2013 5:49pm Mar 20, 2013 5:49pm
What I would honestly suggest you do is trade on a higher time frame which will allow for stops with more cushion. What I mean by this is that a trade on the 5 minute chart could have a stop loss set somewhere around 5-10 pips (or even possibly less), while the corresponding trade on a higher time frame could have a stop of double the pips, allowing you to give yourself some more room.

There really isn't a perfect answer as to how you can get news sooner than the majority of traders. Even some of the biggest traders (Andrei Knight) use this site to inform them when news will occur and the result of said news.

Scalping is a dangerous game and if you can't accept frequent losses, I suggest going up to higher higher time frame.
  • #7
  • Mar 20, 2013 6:20pm Mar 20, 2013 6:20pm
Well that'd already explain why even if I flip a coin and throw a limit order near current price I just lose ehehe
A news feed with breaking headlines would already help, the faster the better.
  • #8
  • Mar 20, 2013 6:28pm Mar 20, 2013 6:28pm
Quoting Marzullo
Well that'd already explain why even if I flip a coin and throw a limit order near current price I just lose ehehe
A news feed with breaking headlines would already help, the faster the better.
Thomson Reuters is what most use as they release 2 minutes earlier to subscribers than public but it's insane expensive. Not worth it in my opinion, especially when the market behaves erratically before and after releases anyway.
  • #9
  • Mar 20, 2013 6:32pm Mar 20, 2013 6:32pm
Quoting Marzullo
A news feed with breaking headlines would already help, the faster the better.

Actually, I doubt that it would help unless you can code
an algo particularly suited for that
and if that were the case you wouldn't think it was
unfair but that you simply coded the wrong algo ?

i have no idea wut i'm speaking of
When the Joker is in the deck.. fear not and play it well
  • #10
  • Mar 20, 2013 6:33pm Mar 20, 2013 6:33pm
Quoting Marzullo
Well that'd already explain why even if I flip a coin and throw a limit order near current price I just lose ehehe
A news feed with breaking headlines would already help, the faster the better.
It's completely unnecessary.....the market often goes opposite to what you would think when news is released anyway.....it's just not needed to be profitable....
Doing what you like is Freedom. Liking what you do is Happiness.
  • #11
  • Mar 20, 2013 7:17pm Mar 20, 2013 7:17pm
Quoting Marzullo
so I suspect richer traders have faster feeds (Reuters?).
Obviously someone else bigger is getting to know things before the retail trader
.

Welcome to the world of finance This is how it has been and always will be. You do have the option to stay out of the market. If the spikes are inhibiting your strategy, you must adapt to the new current conditions. If you refuse to or can't, the market will continue to use your liquidity with no complaints
  • #12
  • Last Post: Edited 11:52am Mar 21, 2013 11:42am | Edited 11:52am
Quoting realjumper
It's completely unnecessary.....the market often goes opposite to what you would think when news is released anyway.....it's just not needed to be profitable....
not that I am trying to guess the news eh..., but toss a random limit order at the market with 20 pips TP and 20 SL at any random time, without counting spread and commission you tend to lose anyway because nobody of the rich informed traders is going to fill your order when it's not convenient for them, and at the same time you'll get filled when price will just run over you past 2 times your SL...

So this is an intrinsic tax which rows against each one of your trades P/L at any moment.
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