Fade the news...

[Hume]

http://captaincurrency.blogspot.com/

[FrankTheTank]

Cool. It would be nice to trade both the spike and the fade to make even more pips

[News Pipper]

Captain Currency

Pipeye the Trader Man

Kandoo the PIP Psychologist


Can you guess the IQ level of their target market?


News Pipper

[romario666]

When Felix had his forexbastards forum I remember one member who use to fade the news. His criteria would be as follows:

1) It had to be a NO TRADE - meaning the actual release number didn't deviate that much but still spiked.
2) The spike had to go against the trend on the 1 min chart ( e.g. before the news the 1 min chart was trending down, but the news spiked up)
3) If 1min chart trending down and price spiked up, go short as soon as price starts going down.

Never tried - sounds too risky

[FrankTheTank]

I have thought about doing that too but with currency futures just to pick up a few ticks here and there for spending money. Using a profit target that is at least twice as big as my stop loss. I think it will work.

[romario666]

Does anyone here successfully fade the news (i.e trade in the opposite direction of the spike after the news release), if you do what strategy do you use?

Also, I've heard people talking about Felix buying on the next wave (buying on the pullback I assume), which seems to contradict fading the news.

So how do you know when to fade and when to buy on the pullback (suppose it depends on the report, how much the news deviated and the market trend).

[FrankTheTank]

You might want to contact Hume by PM. I think he does this method. He doesnt post here much because News Pipper is mean to him.

[jswanson]

i was asked this very question today and honestly it is an art to fade the news. you have to know if there is weakness or strength in the news that just came out and then you need to follow higher highs and high lows up and lower highs and lower lows down. a tick chart of like 23-55 ticks would be optimal.
another strategy that has been employed by many is trading a breakout of the 15minute news candle. there are several versions out there. just take the trade on the break of the 15minute high or low from news time. set stoploss on the opposite end of the 15 minute bar used for entry criteria.

I am not a trading advisor. This is not trading advice.

[badbob]

Originally Posted by Hume

Captain Currency

Is this a system you use?

badbob.