One thing that has become increasingly popular with forex traders is trading when big news occurs. I’m sure you can see why. It’s obviously a quick way to make a buck, optoki especially when you consider that big news can drive the price a currency pair 100-200 pips in a blink of an eye.
But there are some things that you have to realize. For one thing depending on your broker, you may not be able to enter at the price you want to. Since the price is violently moving when news comes out, the broker may not be able to fill your order where you wanted to enter initially. newsheater So, for example you may have wanted to buy using a market order when the price was at 1.4321, but may have not gotten filled until 1.4342.
Another thing that some brokers do is raise the spread. I know that OANDA does this. For example, during normal trading, the spread for the EUR/USD may be 3 pips, but once the news comes out, the spread can raise to 10 pips. This is all a part of trading the news. Stadsrevisionen.dk
And obviously, if you want to trade the news, you have to know what analyst expectations are. Don’t just go by the news release. For instance, if news comes out that the 50,000 new jobs were created vpxco in the last month, that may sound like great news, but if analysts were expecting 80,000 new jobs, then obviously the news isn’t as good as you originally thought it was.
