1) HOW TO LIMIT YOURSELF TO INFLUING NEWS
It is possible to restrict a priori- and quite a lot – the list of news that can have a significant impact on the market in which it is traded, and thus make life easier. In fact, a stock trader will have to worry primarily about the quarterly earnings of companies, while for him the data on retail sales will be absolutely irrelevant. A Forex trader, on the other hand, must be concerned above all with what it has to do with trading, but not with data regarding company profits. An interest rate trader will worry about the unemployment figures, but not that much about the speeches given by the head of the European Central Bank. And so on. So, the moral is that you should only focus on press releases, news,
2) BETTER NOT TO TRADING ON THE OCCASION OF IMPORTANT NEWS
Once you have identified the press releases and significant events for your market, there are three ways to behave: (1) Open positions before the press release, a speech, etc .: this basically means betting and therefore it is not advisable ; (2) Make sure you don’t have any trades in progress during the above events : for most short-term traders this is the best approach, because it protects you from the volatility and the “wild” and unpredictable effects that can arise; (3) Trading in a time window for which the intraday fluctuations created by the event are not significant.
3) SPECIALIZE IN “NEWS TRADING”
If what was said certainly applies to the trader “generalist”, different is instead the speech for those who wish, on the contrary, specialize in the difficult and challenging “trading the news” ( on news trading ). In fact, news and announcements related to economic and financial data often cause short-term price movements on markets, creating opportunities that traders can exploit. For example, reports regarding corporate profits, announcements of any changes in management, rumors ( rumors) on a merger, are all events that can cause the price of a stock to vary widely – even several percentage points in a day – up or down. Therefore, it is necessary to keep an eye on both primary sources of information (press releases, news agency sites, etc.) and secondary (trading and finance sites, news, etc.) and specialized sources.