It is known to all the market participants that the market, more specifically the prices of investment vehicles, budges on the fundamentals of diverse economic events. But the question arises whether the retail traders are appropriately executing their positions based on the economic events or not. Despite the traders, since long, believe that they can, in real, trade and prosper their wealth with short-term trading. If scrutinized minutely, uncovering every micro-component of the market fundamentals, in fact, the traders intending to cash on the short-term markets are, except in rare scenarios, on the unfavorable side.

Now, what causes the traders to lose while trading on the short-term market over the released economic reports or events? The answer is quite simple. By the stance the traders have access to the major economic events/reports, the large market participants having the quicker access to such reports, by then, would have already changed the dynamics of the market, no matter by few seconds earlier. Just for reference, Thompson Reuters is paying The University of Michigan around USD 1.1 million for the right to distribute the reports to the high-speed-traders against some pre-defined fees and charges.

Considering the fact that by the time the short-term traders show buy or sell intensions in any international trading platform with their analysis purely based on these economic events, the market would have, by then, already changed its magnitude. Now, would it be viable for a short-term trader to chase such economic releases for such short-term positions? Definitely not! Now, again let’s reconsider, what should the traders do with the economic reports available publicly? The way out is very simple; just head for long-term positions, but with mandatory limit or stop orders, obviously considering the magnitude of the market.

Further, it is also to be noted that most of the traders normally don’t consider any trades during the volatile market to prevent their positions from the extreme losses. In case if one believes that s/he understands the market fundamentals of a particular investment vehicle and desperately desire to trade, then it is always recommended to go for the positions with limits/stops covering the orders.