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Why aren't traders who straddle the news successful?

  • #41
  • Nov 12, 2015 4:08am Nov 12, 2015 4:08am
Quoting Edorenta
{quote} Are you speaking about ABC trades on the USDCAD? The fact that the moves are always corrected, therefore you can jump in after the first retracement after news? Cheers, Edo
My trading methods vary according to market conditions and if I straddle (back on topic) it is usually well away from the market price going into a major news release. I would be interested to know which broker you use to cosy up to the price.
Gone to a better place
  • #42
  • Nov 12, 2015 4:52am Nov 12, 2015 4:52am
Quoting smikester
{quote} My trading methods vary according to market conditions and if I straddle (back on topic) it is usually well away from the market price going into a major news release. I would be interested to know which broker you use to cosy up to the price.
I have 2 accounts atm, a Pepperstone Razor from which I trade the most (news & scalp), and an FxOpen ECN NZ that I tend to find less reliable.
How about your account setup?
You'll always miss 100% of the shots you don't take.
  • #43
  • Nov 12, 2015 7:56am Nov 12, 2015 7:56am
for the record, news trading used the be the shit 8-10 years ago, i knew some traders who made insane amount of money, most of em were going full leverage on every trade and ended up with 10k to 100k % profit in couple of months.

they bleed brokers to death. thats when broker begun to play games, spread widening, crazy slippage, platform freezing... etc, some less honest brokers simply refused to pay.

sadly i was still a newbie screwing around on demo back then, i missed the golden days
i lose money for a living
  • #44
  • Nov 12, 2015 10:00am Nov 12, 2015 10:00am
The market reaction to news tends to be terribly fickle. I prefer technical analysis and trading during periods unaffected by news.
  • #45
  • Nov 12, 2015 2:21pm Nov 12, 2015 2:21pm
Quoting Edorenta
{quote} I have 2 accounts atm, a Pepperstone Razor from which I trade the most (news & scalp), and an FxOpen ECN NZ that I tend to find less reliable. How about your account setup?
Thanks Edo. I have had experience of Alpari, FXPro and FXCM but now only really use Oanda.
Gone to a better place
  • #46
  • Nov 12, 2015 10:37pm Nov 12, 2015 10:37pm
NFP days result in 20 pips or more 81% of the time. 76% of the time 30 pips.

Nadex( North America only) and IG (not sure territory) offer exchange binary options to capitalize on this.

Learn, a forex trader must, unlearn and relearn he will.
  • #47
  • Nov 28, 2015 1:45am Nov 28, 2015 1:45am
[quote=Edorenta;8588237]{quote} I have 2 accounts atm, a Pepperstone Razor from which I trade the most (news & scalp), and an FxOpen ECN NZ that I tend to find less reliable. How about your account setup?[/quote
Hi Edorenta, for Pepperstone news trading, how about the slippage?
  • #48
  • Dec 3, 2015 6:47pm Dec 3, 2015 6:47pm
Quoting leebsurag
{quote} What about holding no more than the required margin for straddle trades +using credit bonuses offered by your broker? You can't lose more than you deposit we can take advantage of that.
After the SNB crap, very few brokers would actually allow you to lose only up to how much you have in the account and the ones that do have that guarantee, TRUST ME, you pay for that "privilege" in one way or another.
Make your losses in demo. Earn your profits live.
  • #49
  • Dec 3, 2015 7:06pm Dec 3, 2015 7:06pm
Quoting bbmac
These straddle the news strats were popular a few years back but as mentioned above have with broker foul play (platform freezes and slippage etc) seen their popularity diminish.
options traders very commonly set up trades around all kinds of scheduled volatility events....earnings report releases, CB announcements, etc, etc.....there are a variety of strategies that reliably work....they don't always work (but hey that's trading)...most are immune to the problems bbmac mentions....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #50
  • Dec 5, 2015 10:23pm Dec 5, 2015 10:23pm
Quoting leor
Why arent traders who have been news straddling for more than 3year+ multi millionaires as i started since january 2013 and have consistenly gained 25%+ per month risking 2%per trade ? as if you start with min 250usd by 4 years time you will have have made more than $11million most people start with $2,000+ I am aware of broker problems i.e slippage but if you use a stp/ndd broker problems are minimal and rare ive posted this 3 times no response can someone explain
A lot of shady brokers take clients's trade themselves and so they are on the other side of your trades. They will do every trick to NOT let you win when trading news, such as widening of spreads, stop running, etc.
  • #51
  • Dec 6, 2015 1:04am Dec 6, 2015 1:04am
Whipsaw bij HFT will get you hit both stoploss, the direction of news release rarely goes 1 way.
  • #52
  • Feb 7, 2016 1:58pm Feb 7, 2016 1:58pm
This is an importantissimo element of the strategy, Leor: put the straddle on the nearest you can to the release, as you might get triggered for a loss if too early.
Besides that, dealing with a real broker, with direct market access, as opposed to market makers, is a different game altogether.
The strategy works just as well with crude oil inventories every wednesday. In my opinion ea not mandatory, but I've never used one.

Quoting leor
i sent you the link with the ea system above and its basically a buy stop . sell stop 15 secs before news release and a trailling
Patience is magic
  • #53
  • Feb 3, 2017 6:22pm Feb 3, 2017 6:22pm
News trading the EURUSD during NFP that resulted to +92 pips..... I welcome any query on how I set up the trade.
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  • #54
  • Feb 3, 2017 10:10pm Feb 3, 2017 10:10pm
Quoting Edorenta
Hey Guys, I'd like to add my experience on straddle/spike trading to the topic. I've been trading using my own EAs in the past, which lead me to extend my researches on brokers regulation/quality around. If you decide to go for any kind of arbitrage feed or any kind of fast-speed execution broker I would advise you a few I have been happy with. Only the good ones. - Exness (RU): was one of the first broker I've traded with, very good experience for micro account (I'd say even better than Alpari UK and with tightest spreads for a market maker), excellent...
+1 on everything quoted Edorenta wrote. I'd like to think that I was on my way to making a million dollars, but made the one big mistake everyone here is avoiding. Here's my story.

Straddling news release works. In my previous life, I was able to grow my account 300% in about six months. And then I became haughty and aggressive, trading everything that moves -- eventually getting a margin call. I was devastated. I had to quit trading full time and get a job so I can put together a trading capital. Everything happens for a reason though. During this time, I taught myself programming. I also played online poker and learned a lot about statistics, probabilities and outcome.

I started trading again in November 2016. I still straddle high impact news and so far it has been profitable. What's different this time is that my trades are automated.

In my opinion, we won't find millionaire straddle traders in here or in any other trader sites. I think it's because they've become so successful that they would rather live the good life. If I had a million bucks in my account and living off that, I'd be spending my time sailing or travelling. The only times I'd check in on trading is to check on my trading bot and how my account balance is doing.

There are a number of traders here that "gets it", but hasn't made it big just yet. You probably have an idea who these traders are -- and like you, I try to read everything they've shared in this community. Enjoy them while they are here; soon as they make a million bucks, they'll go live their lives offline.
  • #55
  • Feb 4, 2017 1:14pm Feb 4, 2017 1:14pm
Quoting jimsnz
{quote} +1 on everything quoted Edorenta wrote. I'd like to think that I was on my way to making a million dollars, but made the one big mistake everyone here is avoiding. Here's my story. Straddling news release works. In my previous life, I was able to grow my account 300% in about six months. And then I became haughty and aggressive, trading everything that moves -- eventually getting a margin call. I was devastated. I had to quit trading full time and get a job so I can put together a trading capital. Everything happens for a reason though....
hello you say you straddle the news, so i assume you need volatility, right ?
  • #56
  • Mar 12, 2017 1:29am Mar 12, 2017 1:29am
Quoting metta87
{quote} hello you say you straddle the news, so i assume you need volatility, right ?
He is correct. Shortly after I break my first million I will be off traveling the world and living my life.

You don't 'need volatility'. The news is what creates volatility.
"The fun is in the hunt. Not the kill."
  • #57
  • Nov 13, 2017 8:10pm Nov 13, 2017 8:10pm
Hello everyone,

I am by no means the best trader in the world and I have only been trading for about one year. My first 6 months were pretty much a disaster of insecurity, too many indicators and inexperience.

One thing I have become fairly good at is straddling the news. Here is my method.
1. I do this manually.
2. I look at the previous 3 news events on the 1 min and 5 min TF.
3. I look at how much the last candle before the news moved.
4. I look at the tail of the "news" candle"
5. I add the total of the movement of the last candle and the tail of the "news" candle and add 5-10 pips for volatility

If the last 3 news movements are at least 20 pips over and above my "threshold" I trade the event.

I have tight stop losses and even with slippage and volatility I average a 3:1 Return v risk.

Just like trading don't "look" for reasons to trade. If it doesn't immediately jump out as a no brainer don't trade it. I trade about 5 red news releases a month with 4 acct's on 4 screens. spread the risk and don't be greedy. It CAN work.

Good Luck.
Listen more than you speak and be constructive
  • #58
  • Nov 13, 2017 9:19pm Nov 13, 2017 9:19pm
Quoting leor
Why arent traders who have been news straddling for more than 3year+ multi millionaires as i started since january 2013 and have consistenly gained 25%+ per month risking 2%per trade ? as if you start with min 250usd by 4 years time you will have have made more than $11million most people start with $2,000+ I am aware of broker problems i.e slippage but if you use a stp/ndd broker problems are minimal and rare ive posted this 3 times no response can someone explain
Straddling only works (assuming no broker tricks like widening spreads, freezing platforms, slippages and etc.) if:

1) the move is SUBSTANTIALLY BIG, at least 15%+ in either direction

AND

2) the move continues to one direction AFTER the initial news and not retrace back

For 1) it's obvious. Once you've sl'ed in one direction, if the move in the opposite direction is not big enough, then you wouldn't have enough to make up the losses.

2) And worse if the price retraces back after the initial news and actually goes in the previous direction where you stop-lossed, then you are going to be stuck with even bigger losses. Many times, the price reacts in a knee-jerk reaction to the news but once the news quietens down, the price can actually revert back to the original direction then if you've continued in the opposite direction then you might sustain even more losses.

That's why straddling news is not a low-risk sure-win situation. It's actually quite risky and only has a small chance of being successful and that is when the broker does not play those tricks on you.
Make your losses in demo. Earn your profits live.
  • #59
  • Last Post: Nov 13, 2017 10:25pm Nov 13, 2017 10:25pm
Hey Forexia,

I agree with everything you said which is why you need to do proper research on the forecast vs actual and subsequent move. There is always an element of risk but I straddle based on the largest whipsaw/prev. candle range and adda buffer because spreads go crazy.

Thus lets say I'm looking at US core retail sales. Based on the last 3 news releases and movements I would place my entry 15 pips away on either side and manually TP after 10 pips. Not greedy just a piece of the move. I know it is not a sophisticated strategy and, as i mentioned, I only trade a select, and in my opinion, the lowest risk (I know low risk is a relative term during the chaos that is red news events), but I have done well.

I have 4 straddles with tight SL's and even with slippage I average 3:1. Even if the trade initially goes against me and triggers one side of the straddle when it changes direction it gets stopped out and the gain I make vs. the SL incurred is much larger.

Maybe I have been lucky, but I have 11 winners, 1 loser and2 roughly BE trades (small win and small loss). I trade the actual news not the subsequent continuation/retracement ( which I know is also a viable strategy).
Listen more than you speak and be constructive
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