The Forex News Spike Traders still exist and play the same losing game.
Originally posted on ForexFactory on Apr 12, 2008.
When a major news announcement comes out the liquidity drops and spreads widen(sometimes significantly). Getting in immediately the moment the news gets released is insane as there is usually a spike to adjust for all the orders rushing in the market in those few seconds as traders need to adjust to the change in “fundamental value.”
If your trading the news you need to decide If your going to place a trade before or after the news comes out. The prices that spike traders try to enter at just don’t exist. Placing a trade before a news release is just gambling as you don’t know how the report is going to come out.
That leaves only one option, to place a trade after the news comes out……
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