News

[bHtrade]

They say that it's difficult to trade during news releases.. How come?

Thanks!

[TraderPierre]

Hi bH

Liquidity, if say news is dollar negative and you're trying to sell dollars who would want to buy them off you?

For bucketshop marketmakers it's a different story, they take the other side of all your trades so at news time they don't want traders betting the farm and scalping quick profit because they have no way of hedging so it comes out of their own pocket. The better ones either requote or just don't fill market orders, the bad ones freeze the platform or kick you off, and the even worse ones lock your market order so you can't cancel it and fill you at the extreme price spike just before it reverses!

Trading on the release of numbers isn't a good idea for lots of reasons, wait a few minutes and trade the spike in the opposite direction can be a profitable strategy for a scalp but use a stop, sometimes price doesn't retrace!

[bHtrade]

Oh! Honestly, i didn't get it yet.. LOL..But I am trying to soak in the whole idea..

Thanks by the way for you reply and your insights..

[TraderPierre]

Think about it logically, it's really not that complicated

[bHtrade]

Originally Posted by TraderPierre

Think about it logically, it's really not that complicated

Yeah.. that is what i am doing.. to think logically.. thanks!