ya i tried futures before a number comming out, i really dont think its worth haveing a position before hand the risk for me is to great. I sit back and wait for all the shit to go though the fan till I can see how the market is truely reacting to the news.
B, I agree, having a position before economic data or feds speaking is gambling. You have no idea what they will say or how the market will react, aside from the fact that whatever they say will be cryptic. If you can trade this successfully beforehand not only do I salute you but I open my ears for any tips you are willing to provide!
When news comes out it is a given they are going to run it pretty far in both directions before it moves out of that range. If you trade on the right side of the news and don't mind the whipsaw, you are fine. Prefer not to trade the news as it not a high enough probability trade and risk to return scencerio for my style
However it is pretty safe to fade the first move for a quick scalp if you are watching the dom and the cash as the ym will swing much farther and longer then the cash usually.
In my experience if the economic data is not an obvious bearish or bullish signal the first move will not be real. However, this still implies that you place your bet, I mean position heh, after the news are released.
You have to take liquidity into account, on ES it will almost always be .25 spread but in YM I have seen it go 2 or 3 points and it gets even worse in afterhours. The spread really makes little difference when you take liquidity into account. To do enough size in YM for it make that big of difference you are going to run into other problems first.
Just depends on how ballsy I am feeling before the report. I usually tend to fade extreme moves and that is what you get the majority of the time with these reports.
Neet - here is something to watch - see if you get any of your 'normal' setups before the news and then how the markets react. I have found for me that if I get a signal - long or short - before the news that the market may already be pricing in the announcement. If I wait for another confirmation, it may be too late as the move may have already occured. Just something to watch.
volente, that's utter rubbish during (cash) market hours (and even sometimes afterwards), the dow is CONSISTENTLY a 1 tick spread and it is more profitable for a scalper, ceteris paribus, to have a smaller spread. as well as more efficient for stops as for SGXNK being 5 pts - i know. that's what i trade. that's not the full size japanese nikkei contract. that contract is 10 pt spread.