High-impact news events can introduce significant volatility and unpredictable market conditions. To ensure disciplined execution and effective risk management, trading activity is restricted during these periods.
The Rule
Trading is strictly prohibited within a 10-minute window surrounding restricted news events, defined as:
- 5 minutes before the scheduled event
- 5 minutes after the event
This restriction applies to all new entries and exits without exception.
✅ Order modifications are permitted during this window, including:
- Adjusting stop-loss levels
- Modifying take-profit targets
- Canceling Orders
News Source:
- We utilise Forex Factory for news-related releases.
Affected News Releases:
This rule applies to all pairs on the following news releases:
- Consumer Price Index (CPI)
- Federal Open Market Committee (FOMC) Statement
- FOMC Meeting
- Non-Farm Employment Report
- USD PMI
Red Folder News Events:
- For red folder news events impacting a specific currency (e.g., GBP), trading is restricted for all pairs involving that currency(e.g., GBPUSD,GBPJPY) and any indices(e.g., FTSE100) priced in that currency.
- For all-day red events, trading is restricted for all pairs involving the corresponding currency for the entire day.
- Events such as presidential announcements, geopolitical conflicts, war outbreaks, sudden economic releases, or central bank decisions/speeches can cause extreme volatility, widened spreads, and liquidity disruptions Across all instrument as such any of the above mentioned releases will affect all currency instruments.
Speeches:
- If a speech is labelled red on Forex Factory, you must wait for the speech event to end. Only after 5 minutes can you resume trading freely. During this time, all the above rules apply.
- A news event is set for 12:30 PM, which means you cannot enter new positions or modify existing ones from 12:25 to 12:35 PM. However, existing take-profit, stop-loss, and limit orders will remain unaffected. Trading is restricted for all pairs involving USD and for any indices (e.g., DJ30) priced in USD during this time window.
News releases which at our discretion will be announced prior to their release via email can not be traded for the duration mentioned in the email.
Black Swan Events
During black swan events, markets can experience extreme volatility, including significant slippage, widened spreads, and erratic price movements across asset classes. These conditions may result in unrealistic fills and substantial losses, even for experienced traders
While these events may not fall under typical “news rule” breaches, spontaneous announcements and economic shocks can lead to trades being voided due to market irregularities.
Summary
If a news event is classified as high-impact or prohibited:
👉 Do not open or close new trades within the 5 minutes before or after the event.
👉 You may manage or modify existing positions during this time.
Adhering to this rule is essential for maintaining consistency, protecting capital, and executing a disciplined trading strategy.