I traded the EUR/USD during the US Advance Retail Sales announcement I entered the trades after the news release was announced, I didn't look at the results of the announcements just the price. Once I saw the price shift heavily one way I started trading in that direction. It was a matter of hitting the buy button for 15 times for 1 lot with slippage setting set to 0 and getting filled. I didn't get slipped badly on the exit. Only thing I am upset about is not holding for a minute or 2 longer. The price just ran away so the risk was minimal. Moved to break even after 5 pips secured 20-30 pip profit on the trade. Could have been twice that had I held longer. Is this gambling ? I am not betting before and hoping the price to go a particular way, I am only placing a trade after I see a clear change price when the market starts pricing in the new information. If you look at even the 5 minute chart at 13:30 for EUR/USD you could have entered with a 5 pip stop and exited with 70pip profit 10 minutes later. 35:1 risk reward I know prop traders do this sort of thing and I guess your at the whim of execution and liquidity but I had no problems on a 15 lot order on EUR/USD. Would love opinions on this sort of trading. I mean this is the raw market, not some mumbo jumbo TA or fundamental guesswork.
I'd say that trading strictly the release is a form of gambling. However, if you can read price, you can usually tell if it's setting up for an up or down move before a release. That's been my experience, at least.
The odds of predicting a price move prior to a release is much more difficult the GBP was heading down once the news came out it shifted 20 pips instantly. All those who were short thinking they could read price action lost.
I can't speak for those people except to say that risk management plays a large role in how much their wrong decision will affect them.
You need 15 second chart for news trading - then it is conventional technical analysis, with support/resistance levels put in advance of the news event of course. And watch for the news volume dry-out - when that happenes you should go back to 1/3/5 minute timeframe (the news event trading is over and market is back to normal) - this happens after a few minutes most of the time, but could last as long as the whole trading day.
Ive been trading announcements for years with zero regard for the content of the report or whatever it is. Stops and similar measures are not going to help - you control your risk with your size. also u need to model post-report behavior to have any understanding of what to do.
If you trade before a major news announcement you will definitely get slipped and your stops will just trigger at the next best price. I was looking at gbp/usd before the announcement it was -13 pips for the day one second later its +10
To the extent that you are betting on an uncertain outcome, you are, by definition, gambling. Some gambles are better than others. Some gamblers are better than others. So perhaps you meant to ask whether trading the news is a good bet. The answer would depend on either how good your information sources and analytical capabilities are before the report, or how well you respond to a report's price action immediately thereafter. In either case, only you can answer that question.