Why trying to get in before the spike will never work

[moccogebevec]

I used to believe that the spike that follows news releases was due to lots of new orders coming in to the banks therefore the price goes. If this was true so long as you were faster than everybody else, then you could get in at the bottom/top of a spike and also profit out of it. That's what a lot of these news trading signal suppliers want you to believe. I recently found out that this is complete BS. The spike is due because the banks themselves (e.g. Bear Stearns, JP Morgan, Deutsche Bank) automatically adjust their prices in response to the news. It is all done without human intervention and is instantaneous - there is no way of getting in before the spike in case your orders are going directly to banks (as with such as EFX and Currenex). If you are with a market maker such as Oanda or FXCM you can profit from taking advantage of this delay between their prices and bank prices - which understandly they try to prevent you doing. Of course there are methods of profiting from news releases - trade the pullback such as or fade the spike - but getting in before the spike since these silly and pricey news hint suppliers would have you believe is not an option.