What news ??

[karl6666]

Folks

Trading the news, what news, the normal news or formal news announcements posted on financial websites or both. This is a common practise to trade the news, but in the small print of every broker it states ‘trading under normal conditions’ surely people are leaving themselves very exposed in terms of not getting filled, stops not working and brokers generally taking advantage of any ‘software error’ at volatile news times.

cheers

 

[Magos]

Folks

Trading the news, what news, the normal news or formal news announcements posted on financial websites or both. This is a common practise to trade the news, but in the small print of every broker it states ‘trading under normal conditions’ surely people are leaving themselves very exposed in terms of not getting filled, stops not working and brokers generally taking advantage of any ‘software error’ at volatile news times.

cheers

Trade 30 min before news and yes IB's widen the spreads and don’t guarantee stops... alter your strategy a bit

 

[garethj]

Trade 30 min before news and yes IB's widen the spreads and don’t guarantee stops... alter your strategy a bit

Is there somekind of a benchmark for that ? Don't know if someone could automate that but if possible, this would be a must-read.
Like opening micro-accounts at different brokers, putting the same orders on all of them and recording what's happening (stops respected,...). And in the end every broker would get a "respect your consumer" grade.

 

[Magos]

Is there somekind of a benchmark for that ?


on there is no benchmark for that. Assuming that the figure will create a large movement and IB's will widen the spread at the point of figure relise, 30-40 min should be enough to trade the figure.

Don't know if someone could automate that but if possible, this would be a must-read.



that could be automated using EA's for instance figures in FX, using MetaTrader


Like opening micro-accounts at different brokers, putting the same orders on all of them and recording what's happening (stops respected,...). And in the end every broker would get a "respect your consumer" grade.


That can be done but requires lots of hours of programming , you have to build an EA with a multi-terminal CORE using API's

hope all the above help

 

[garethj]

hope all the above help

Well, as implied by my rookie status, I am definitely not the guy to code such a thing.
And yes it's helpful reading, good way to understand I still have so much to learn

 

[tomorton]

Trading company results announcements is fun but beware of quotes outside the underlying market hours - essentially they are 'made up'. Alpesh Patel did publish a simple plan to trade on company results - wait for the announcement, usually 7:00am, then wait for the market reaction - this can bounce around as people digest the news and orders are filled. When the confirmed price direction emerges, buy if its up on last night, short if down. Use last night's close as the stop-loss. Holding today and possibly tomorrow should be enough but sometimes these announcements mark significant reversals on longer-term. Good strategy for large caps where spread narrow and market interest great, possibly smaller caps if backed by much sentiment to generate volume. Losses should be slight but I have twice had 12% gains in 3 hours using this method.

 

[karl6666]

Hi Tomorton


Could we roll the same procedure with FX, if so how

K

 

[tomorton]

Hi K -

I suspect it should work equally well, but only as long as you select a news item which carries the same weight with regards the market you're trading, as does the annual results announcement of an individual company. FX traders will know what these news items might be but I don't touch it so can't specify.

 

[garethj]

I would be curious if some people tried that on forex. It is said that few bodies can move currency values like stocks. Company financial results can tremendously boost or ruin a stock while even a CB announcement will have a marginal impact on currency/pair/...

In terms of risk:reward, I am not sure it would be work. I should test that on my demo account.