
If you are using a reliable market news feed it's unlikely that you're getting news too late.
----
We interpret and explain price moves in real-time, 24 hours a day. Our team of analysts produce text, video and audio commentary.
You understand the markets and trade with confidence. Learn more at our website here: https://bit.ly/2HFykNd
-----
We have a quick question here from Abul asking why price sometimes reacts so insanely fast once a piece of news breaks over the wires, and he's asking whether some traders might be getting the information before the rest.
So Abul, it might be true that some traders sometimes might be privy to information before the rest of the market. Maybe they are looking at the precisely correct things at the perfect time and they get a piece of info before the rest of the market, or maybe they just might be getting some inside information, which is still very possible. But to be honest, news feeds are usually extremely quick with any type of breaking news that hits the wire.
So, our squawk desks basically monitor all the major news wires, the not so major news wires, and they have TweetDecks that basically monitor key info channels, including central bank watches, market participants, politicians, etc. And they even monitor things like the Bloomberg Terminal. So if something breaks, it won't take them very long to squawk that information out and by the time you hear it on the squawk, it will still be considered very, very fresh news and information.
So, what you're mostly seeing when you see those type of very quick moves are normally from algo traders, so trading systems that have been built to monitor news channels, and the moment something significant crosses the wires it basically places trades at record speeds, much faster than any human trader can. And this is mostly evident when you see things like central bank policy statements being released, right?
So, those statements are usually quite long and it'll take you a couple of minutes to read through that and really digest everything inside it. But what we often see with those releases with the statement is the moment the statement is released the market can already have big moves within milliseconds.
Now of course, I'm not talking here about times when the interest rate move itself surprises the market, that will of course see big moves and will be able to be caught by most traders, but what I'm talking about is times when the interest rate itself isn't so important and all the focus is on the statement itself. Now, there's no way that a human can read the statement and place a trade in under a millisecond, right? So, if they can, I mean, it's just amazing, but it just doesn't happen.
So, rather what you're seeing there, once again, is algo trading, so trading systems that's designed to look for specific words and specific phrases in the statement and basically execute those trades automatically the moment the statement is released.
So, this automation is normally referred by some market participants as 'the machine', and it is the reason why you see those very extreme fast price moves just as the news comes out.
So, don't worry, you are definitely getting the news very fast if you are using something like Forex Source. The quick moves that you're seeing are mainly just from algo traders and not because everybody else is getting the news too late.
-----
If you find this content helpful, you’ll love Forex Source.
There’s a link below were you can learn more about it
https://bit.ly/2HFykNd