A lot of sideways movement this morning resulting in a 9 pip loss on the GBP/USD as the market bounced back up hitting my trailing stop. There were lots of economic news releases schedualed for 1.30pm today and so I steered clear of any trades this afternoon until after this. At 1.30 the market dropped suddenly then jumped straight up like a bullet. I guess not good news for the strength of the dollar. No trades after that.
I had some good advice from Gaz today regarding news announcements:
“From what I gather you should never be in a trade or enter 15 minutes prior to an announcement. However, it does depend on the importance of the news. If it’s a high impact news item follow these rules, if it’s only a medium impact then it’s usually pretty safe to stay in the trade. Forex factory.com tell you before hand which of the news item are eith er high, medium or low impact.”
And Terry offered this:
“Just a thought about economic announcements: we discussed them a couple of
weeks ago and I thought it might be a good idea for you to stop trading at
lunchtime tomorrow as it is the day of the NFP announcement, which always
has a large effect on the dollar markets, particularly in the present
economic climate. The figures come out at US market opening time, 13.30 our
time and they can move the market as much as 100 pips in a few seconds on
occasion. The brokers defend themselves against this by increasing spreads
to as much as 20 pips and/or shutting down their desks for minutes at a
time. Not nice if you are speculating on the figures.”
So good to know for anyone trading tomorrow. Cheers guys.