Don't trade the news they say... Why not?

Because this is what you have to read through everyday to figure out the markets.

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USD rally on the way… no dollar slump… no there are no safe currencies…

Who said trading was a get rich scheme?

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I’d say don’t trade other ppl’s opinions

Trading the news means to understand what is being reported to the market.

Most recent example perhaps in the last 24 hours - Nvidia

Long before the market opened we knew that Nvidia reported what it reported - so who in their right mind would have shorted stocks today?

Ok - this is not about points - it’s about pips - so who today wld then buy Yen vs Usd given Nvidia’s reported earnings?

The market revolves around investors (the guys who already have money and are seeking more)
NVIDIA Corporation - NVIDIA Announces Financial Results for Fourth Quarter and Fiscal 2024

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From the sound of it, I’ve watched a couple market videos related to macro discussions and crypto specifically, and several of the “gurus” shorted Nvidia big thinking it couldn’t maintain performance from the last couple quarters. They were wrong!

It’s down to how tech is evolving and right now that means AI - and AI means Nvidia I read that even McDonalds are embracing it.

The growth potential is huge - and it’s that potential that investors looking at.

Nvidia’s stock has risen almost 240% last year - question is perhaps overvalued - thus those that went short - thing is better to wait on the earnings which were signalling buy.

Will it correct? - just over 50% of those polled reckon the stock market in general will correct in the months ahead, so who knows.

My feeling is to go with the flow.

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Huge spreads, whipsaws, and slippage make it challenging. If you can make money in spite of these obstacles, then great!

I’ve been on both sides of this. Luckily, normally on the plus side. But whipsaws can get crazy! Like I’ve seen 100 pip moves on a single 5 min candle.

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do you own now and will you sell or hold?

You don’t need to be confused, friend. Because the impact on the market will be dynamic from time to time. The market moves with conditions that do not necessarily correspond to the theory of the effect of news. So the most important thing is to follow the market direction when the news is released. There we can follow where the price moves and place orders.

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You know, a lot of seasoned traders will tell you to think twice before jumping into trades solely based on news events. Why? Well, for starters, markets have a funny way of already factoring in expectations even before the news drops. It’s like they say, “buy the rumor, sell the fact.” So by the time you react to the news, the market might have already made its move, leaving you stuck at a less-than-optimal price.

And let’s talk about unpredictability. News events can be a wild ride, sparking sudden and crazy reactions in the market. Trying to navigate that kind of volatility can be like trying to steer a boat in a storm – tough and nerve-wracking.

Instead, some traders swear by focusing on price action. You know, analyzing those charts like a detective looking for clues, using technical indicators to suss out potential entry and exit points. It’s like reading the signs the market is giving you, rather than getting caught up in the latest headline frenzy.

Before opening a long trade in advance of news, ask yourself, “Am I smarter than the entire forex market, do I have more information then they do, plus a more powerful computer?”
The answer is unlikely to be Yes.
So if the market is really smart and they have so much information plus the world’s best computers, but they are still not buying, why should you?

But let’s suppose price is flat and news is expected soon, what can you do to take advantage of what you know?

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Agree. Trying to outsmart the entire market, especially before news breaks, is incredibly challenging. If prices are stable and you know news is coming, it’s better to wait and see how the market reacts to the news before making any trades.

Ha, that’s a good question to ask myself.

If you watched the charts this morning and then maybe a couple hours after, you’ll see what trading the news is crazy time.

USDJPY moved 158 pips down, and then by now, back up 132 pips. Pretty close to the middle of Tuesday’s range.

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When trading during news releases, it is important to correctly predict the movement. But not everyone succeeds; sometimes it is very difficult to predict how the price will move. Can you do it? History on a chart is not an indicator