News days versus non news days in my results, a split I'd never looked at

[Fairman]

News days versus non news days in my results, a split I'd never looked at

I tagged every trading day in my journal as a news day or a quiet day, depending on whether there was a major release for the pairs I trade. After a couple of months, I split my results to see what it showed.

I assumed I'd do worse on news days because of the volatility, and I was partly right. But the more interesting thing was how I behaved. On news days, I had more rule breaks and more trades outside the plan. I got excited, or I got caught out by a spike. On quiet days, I was calmer and my results were steadier.

The money result was lower on news days, even though I'd planned to stand aside during the releases. The damage was mostly done in the hours after, when I was trying to catch the move, or before, when I was nervous.

That's led to a change. On major news days, I now trade a smaller size and a shorter window, or only in the hours before the release. On very big days, I may not trade at all. I'll keep tracking to see if it helps.

[Fairman]

I did the same split and found the same thing. The damage was not during the release, it was the hours around it when I was chasing the reaction or jittery in the lead up. What helped was making news days lighter by design: fewer trades, smaller size and a firm stop time. On quiet days I trade my normal plan. Seeing the two groups separately showed that the problem was behaviour, not the market. Planning the lighter version of those days ahead of time is what made the difference for me.

[Fairman]

Worth adding a tag for the type of news as well. For me, central bank days and jobs data behaved very differently from smaller releases. On the big ones I am now flat for most of the day, and on the smaller ones I just avoid the half hour around the release. Splitting it that way showed that most of the damage came from a handful of big events, not news days in general. Knowing that, I can plan the few heavy days in the month instead of treating every release the same way.