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Agressive news trading?

  • #1
  • First Post: Aug 19, 2006 5:12pm Aug 19, 2006 5:12pm
Hey everybody!

I want to know your oppinion about news trading. I mean "breaking news", just most important monthly reports such as US Employment and CPI, PPI...
Putting a buy stop and sell stop few minutes before the news come out, in range of 15pips with 10pips stop loss, then closing the position when the price jumps high or falls down... What are the risks? It seems like "ALL I CAN LOOSE" is those 10 pips, whlie chances of 40-100 pips profit are high. I looked back on those news events and they are almost always bring a agressive price change. I barely saw a case where an important report doesn't affect the price.

What do I miss here? What are the risks and where do I loose?

It just seems to good to be true. And if it WORKS, I wonder why most of traders don't double their accounts once or twice a month? (or they do?)

Anyway, it seems like here are cool and experienced people on this fourm.
I'd love to hear your recommendations, opinions and suggestions!

Thanks
  • #2
  • Aug 19, 2006 5:47pm Aug 19, 2006 5:47pm
it is a quite risky thing to play like that.

If you set orders on each side, and set stop losses at 10 pips you can acctually lose way more than that.

80% of the time they do not fill your 'entry' order for 20-40 pips past your order on news events from what ive personally experienced.

So if they have 40 pips of slippage, and your stop loss was already 10 points way you could acctually lose 50 pips in 10 seconds.

And if your using to much margin 50 pips can wipe your balance out completely.
  • #3
  • Aug 19, 2006 8:02pm Aug 19, 2006 8:02pm
Quoting coon_70
it is a quite risky thing to play like that.

If you set orders on each side, and set stop losses at 10 pips you can acctually lose way more than that.

80% of the time they do not fill your 'entry' order for 20-40 pips past your order on news events from what ive personally experienced.

So if they have 40 pips of slippage, and your stop loss was already 10 points way you could acctually lose 50 pips in 10 seconds.

And if your using to much margin 50 pips can wipe your balance out completely.

HI,

U might be probably rite... but i would like more replies on Itljonīs question on Straddling the News.

Specialy from the people who straddle the news on thier Live Accounts not on their Demos.

Keep the good work on. :-)
  • #4
  • Aug 19, 2006 8:53pm Aug 19, 2006 8:53pm
why straddle? why not just interpret the report and place an order if your intrepretation merits it. i would not recommend straddling because of whipsawing... you can get both orders filled and hit their respective stop losses with a moderate whipsaw.
double loser.
i think i'll start looking at mutual funds...
  • #5
  • Aug 19, 2006 9:10pm Aug 19, 2006 9:10pm
Quoting squat1962
why straddle? why not just interpret the report and place an order if your intrepretation merits it. i would not recommend straddling because of whipsawing... you can get both orders filled and hit their respective stop losses with a moderate whipsaw.
double loser.
i think i'll start looking at mutual funds...

Hi squat,

Good one, Agree with u ... get the knowledge where the market is supposed to go and trade in that direction with one entry order instead of two.

I would also like to know From ppl who trade Live Accounts (live acc. only please no Demo users.) -Not being rude.
If u see any kind of slippage when u have a pre-entry order with a pre Stoploss and Take profit orders.
I mean have u made any losses bcoz of preentry orders with their S/l and t/p. If yes on which Broker and if it works fine with Which Broker. would be helpful to lot of people here.

Hav fun.
  • #6
  • Aug 19, 2006 10:27pm Aug 19, 2006 10:27pm
Quoting ltljon
Hey everybody!

I want to know your oppinion about news trading. I mean "breaking news", just most important monthly reports such as US Employment and CPI, PPI...
Putting a buy stop and sell stop few minutes before the news come out, in range of 15pips with 10pips stop loss, then closing the position when the price jumps high or falls down...
L. J.,

Many people trade news. But to avoid vain repetition, check out the thread "How Do You Trade the News?" in this forum. It has nearly 500 replies and 42,000 views; all of your questions are answered therein.
  • #7
  • Aug 20, 2006 5:06am Aug 20, 2006 5:06am
Thanks alot for your replies ppl!
I'll dig the issue abit more...
  • #8
  • Aug 20, 2006 5:57am Aug 20, 2006 5:57am
Quoting squat1962
why straddle? why not just interpret the report and place an order if your intrepretation merits it.
Unfortunately, not everyone has a very fast news wire to include the all important Ear-Eye-Brain-Hand Coordination (once you hear/see the news, let your brain decode an decide and command the hand to place the order).

Perhaps, by the time you make a decision, the market had already surged 50 pips up and your broker could not enter you as well (repeated requotes).
  • #9
  • Aug 20, 2006 6:55am Aug 20, 2006 6:55am
OMG yet another news trading thread! Sigh.
  • #10
  • Aug 20, 2006 7:38am Aug 20, 2006 7:38am
trading the news seems to be in vogue right now but as was stated in anoher post it will only be a matter of time before the news becomes very untradeable for what ever reason...I have been noticeing fills have been getting worse, spreads have been getting wider, slippage is greater......I don't know maybe its just August, maybe its because there are more small traders (read sheep for slaughter), maybe it just me.....most likely.....so I will continue to sit out teh news trading and make my pips with my main strategy....
Same Whore .... Different Dress
  • #11
  • Last Post: Aug 20, 2006 8:40am Aug 20, 2006 8:40am
I am new to this several months in what strategy do you use?


Thanks

Tom
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