Forex real time news trading is a way of making money on the forex market from international events and upcoming current affairs stories. Predicting the way that these events will go and their effect on the currency markets can appear to be very profitable, at least in theory Pimpandhost.
The problem is that in practice things do not often go the way that you might expect. The truth is that when it comes to financial news, the major international banks pretty much always make sure that they are the first to hear. When an expected report is released they will have people right there.
The independent trader, on the other hand, has to wait a few crucial minutes for the report to appear on the TV news or the internet. Even seconds can make a difference. At times like this the markets will change so swiftly that you cannot really hope to jump in and make money. The banks will dominate the markets and although you may sometimes be lucky, you could easily be wiped out if the news goes against you.
In practice if you do want to trade on the outcome of an upcoming event such as an election or a financial report, you are more likely to try it by opening a trade before the announcement. You might have a strong belief that it will go one way or the other. However, you cannot really know for sure. When you think about it, opening a trade at this time is really nothing more than betting on the outcome. It is at times like this that we tend to be easily carried away by our own ideas, hopes and emotions.
It can be very difficult to make a rational assessment of a situation where so much can ride on the outcome. Therefore, unless you are really in the thick of the financial news centers, it is probably best to avoid this kind of trading.
A system that makes steady profits over a period of time is the best way for most small traders to operate. Of course you must still keep one eye on the news while you are actively trading, but instead of aiming to make money from current and upcoming events, you are more likely to want to close out on your trades before certain reports are released.
Most forex brokers will alert you by email before the major news days occur. An example of a forex real time news day would be when the non farm payroll report comes out on the first Friday of the month. This is usually a day when only the most experienced and risk adverse will trade as wild swings can occur on this day. Just don’t trade preceding a major announcement or release of forex real time news.