News Trading Restriction

Trading Rules & Restrictions

Source review:

According to Vigil's prop trading glossary, News Trading Restriction is a rule prohibiting or limiting trading during major economic announcements like FOMC, NFP, and CPI releases. Firms restrict news trading because extreme volatility can cause rapid drawdown breaches. In prop trading, understanding news trading restriction is critical because it directly affects your drawdown limits, position sizing, and whether you pass or fail an evaluation.

This term is part of the full prop firm glossary.

View in full glossary
How does news trading restriction work?

News trading restrictions vary significantly across firms. Some firms forbid opening or closing positions within a window around major news events (typically 2-5 minutes before and after). Others allow news trading during evaluation but restrict it on funded accounts.

FTMO restricts news trading on funded accounts only -- you cannot open new positions 2 minutes before or after high-impact events. During evaluation, news trading is fully allowed. Apex restricts news trading in both evaluation and funded phases. The5%ers and FundedNext allow news trading without restrictions.

The restricted events typically include FOMC interest rate decisions, Non-Farm Payrolls (NFP), CPI reports, and GDP releases. Some firms publish a calendar of restricted events. Violations are usually detected automatically and result in profit from those trades being removed or the account being terminated.

What does news trading restriction look like in practice?

FTMO funded account, NFP release at 8:30 AM EST: you cannot open or close positions between 8:28 AM and 8:32 AM. If you hold a position through the window, that is allowed -- the restriction is on new orders. Apex is stricter: no positions can be open during FOMC/NFP/CPI. If you hold a position into the restricted window, profits may be reversed.

Why does news trading restriction matter for prop firm traders?

News Trading Restriction rules vary between firms. What is allowed at one firm can be a violation at another. Always verify before your first trade on a new account.

Practical example across firms: FTMO: 2-step, static drawdown, 5% daily loss, from €155. TopStep: 1-step, trailing drawdown, 2% daily loss, from $49.

Common mistake: The most common mistake with news trading restriction: carrying habits from one firm to another without rechecking. News Trading Restriction rules can differ between firms and even between evaluation phases at the same firm.

How do different firms handle news trading restriction?

Understanding news trading restriction is essential when choosing and trading with a prop firm. Compare how different firms handle this:

What terms are related to news trading restriction?

Overnight Holding

Keeping trading positions open past the daily market close. Some prop firms require all positions to be flat (closed) before the end of the trading session, while others allow positions to be held overnight.

Weekend Holding

Keeping trading positions open from Friday market close through Monday market open. Weekend holding carries gap risk because markets can move significantly over the weekend due to geopolitical events.

Daily Loss Limit

The maximum amount you can lose in a single trading day before your account is flagged or terminated. This resets each day and is separate from your overall maximum drawdown.

Position Sizing

The process of determining how many contracts, lots, or shares to trade per position based on your account size, risk tolerance, and the distance to your stop-loss. Proper position sizing is the foundation of risk management.

See news trading restriction in action
Where can I learn more?

How to Pass FTMO $200,000

Step-by-step guide

How to Pass TopStep $150,000

Step-by-step guide

How to Pass Apex Trader Funding $300,000

Step-by-step guide

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TopStep Trust Score

Independent trust audit

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