The pre-news spread timeline most people never log

[Fairman]

The pre-news spread timeline most people never log

Tier one data does not hit a clean market. The spread starts changing well before the release, and the sequence is surprisingly consistent.

Roughly five to ten minutes out, depth begins to thin. Spreads edge up by a few tenths of a pip. Two minutes out, many liquidity providers pull back and the spread doubles. In the last 30 seconds, it can be five or ten times normal, and some brokers stop offering quotes on certain pairs altogether.

Then comes the release, a burst of chaos, and a recovery over the next several minutes. The spread rarely returns to normal in one step. It tends to settle in stages, with a second small widening if a follow-up headline arrives.

The practical lesson is that the cost of entering a trade rises long before the news does. A scalper who enters at 8:27 for an 8:30 release is paying a hidden premium on both the entry and the exit.

Recording the spread in the ten minutes around each major release for a month produces a personal timeline for each broker and pair, and it is usually more useful than any general rule.

Averaging across many events can mislead. Some releases cause enormous widening and others barely register. Grouping the data by event type shows which ones deserve a trading blackout and which can be tolerated, and that grouping usually reveals two or three events responsible for most of the damage.

One practical output of the exercise is a personal blackout schedule: the exact minutes before and after each type of event during which the spread on the chosen pair exceeds a set limit. It replaces guesswork with measured windows.

What does the spread on the main pair look like in the final minute before a big release?