Foreign exchange trading news gives some traders the information that they need to make lots of money with day trading or scalping techiques but for others it just seems to bring about a giant wreck.
test your broker’s terms and conditions if you’d like to trade around stories reports. Some will mechanically close your currency trades on occasions of high volatility. Others will not allow you to open a new trade. Many brokers will increase the spread at these times and you may not be told by how much. Higher spread can suggest that you finish up losing on a trade where you believed you definitely made a profit, so it is essential to take this into account.
Slippage occurs when you do not get the price that you saw on your screen. It is commoner with some brokers than others because it is dependent on their financial model and whether they have to cover the risk represented by your trade. With some market makers you can experience major slippage even in comparatively stable times. Around the time of a foreign exchange trading press release it is even more likely because the price can change in the split 2nd between you seeing it on screen and clicking a button. The same is applicable to stop and limit orders : you are much less sure to get the price you were expecting at these times.
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