You've been trading your prop firm challenge for three weeks. Your account is up 7%, well past the profit target. You place one final trade two minutes before the Non-Farm Payrolls release, ride the spike, and close out with a clean pass. Then you get an email: your challenge has been invalidated. The profit from that trade doesn't count.
This happens more often than most traders realize. Prop firm news trading rules are among the most misunderstood policies in the funded trading space, and violating them doesn't always result in a dramatic account blow-up. Sometimes the penalty is quieter — your profits silently disappear, your payout gets reduced, or your pass gets reversed during an audit you didn't know was coming.
This guide breaks down exactly how major prop firms handle news trading in 2026, which events trigger restrictions, what the actual penalties look like, and how to set up your workflow so you never get caught off guard.
What Counts as "News Trading" at a Prop Firm?
Before diving into specific firm policies, it helps to understand what prop firms actually mean when they talk about "news trading." It's not as broad as it sounds. Most firms are not concerned with you having a position open during any piece of economic data. They care about a specific behavior: opening or closing trades in a narrow window around high-impact scheduled events, with the intent of capturing the resulting volatility spike.
The standard definition used by most firms focuses on red-folder events as classified on Forex Factory's economic calendar. These are high-impact releases that tend to move markets sharply within seconds: interest rate decisions, employment reports, inflation data, and GDP figures.
What typically triggers a restriction:
- Opening a new position (market order, pending order, or limit order) within the restricted window
- Closing an existing position within the restricted window (including take-profit and stop-loss orders that execute during the window)
- Placing bracket orders (buy stop and sell stop) around the release to capture movement in either direction
What usually does not trigger a restriction:
- Holding a trade that was opened well before the restricted window
- Trading instruments that are unrelated to the event's currency or market
- Trading during low or medium-impact news releases
The fact that your take-profit hits during a news release can count as "closing a trade within the restricted window" at some firms. If you're running a position with a tight TP heading into NFP, check whether your firm counts automated exits toward the restriction.
News Trading Policies: Firm by Firm Breakdown
Every prop firm handles news trading slightly differently. Some ban it outright during funded phases. Others allow it but strip the profits. A few have no restrictions at all. Here's how the major firms stack up.
FTMO
FTMO takes a phased approach. During the Challenge and Verification stages, you can trade freely through any news event without restriction. The rules change once you reach the FTMO Account (funded phase): you cannot open or close trades on affected instruments within 2 minutes before to 2 minutes after major economic releases. Trades opened more than 2 minutes prior can be held through the event.
The exception is the FTMO Swing account, which has zero news trading restrictions in any phase — challenge, verification, or funded. If your strategy revolves around news-driven volatility, the Swing account removes this friction entirely.
FundedNext
FundedNext uses a profit-reduction model rather than outright prohibition. On most account types, trades executed within a 5-minute window before and after high-impact events are subject to the News Reward Share Rule: only 40% of profits from those trades count toward your balance. Losses, however, count in full.
The Express Challenge is stricter — you cannot open or close any trade during the 5-minute window, including pending orders. Meanwhile, FundedNext Futures has no news trading restrictions at all. Existing positions can be held through news events on all account types without penalty.
The5ers
The5ers enforces a 2-minute blackout window on their HighStakes program: no orders of any kind (market, limit, stop) can be placed 2 minutes before or after high-impact red-folder events. Trades executed within this window are classified as a soft breach, meaning profits are deducted from your account and won't count toward your profit target, but the account remains active.
Other evaluation programs at The5ers currently allow news trading without the 2-minute restriction. [UNVERIFIED] The5ers also explicitly prohibits bracketing strategies — placing buy and sell stops around a news release to catch movement in either direction. This is treated as a serious violation that can lead to account termination.
Alpha Capital Group
Alpha Capital Group varies its restrictions by account type and phase. On Alpha Pro accounts, the funded phase imposes a blackout window where you cannot open or close trades 2 minutes before or after red-folder events. The specific window length depends on your plan: 4 minutes total for Pro 8% and 10% accounts, and 10 minutes total for Pro 6%, One, and Three accounts.
For the 2-Step Swing plan, news trading is allowed, though trades opened within 2 minutes of a release must remain active for at least 2 minutes. The Alpha Swing account has no news restrictions. If your strategy depends on CPI or NFP volatility, this is the account type to choose.
Blue Guardian
Blue Guardian allows news trading during challenge phases but applies restrictions on funded accounts. On funded accounts, opening or closing trades within 5 minutes before or after high-impact red-folder events is restricted. Rather than failing your account, Blue Guardian removes any profits generated during the restricted window.
The firm also prohibits what they call a "Boom or Bust" approach — relying on a single trade or cluster of trades around a major news event for the bulk of your profit. Their automated Guardian Shield system will close all open positions if your floating loss hits 2% of the initial account balance.
Maven Trading
Maven Trading enforces a 2-minute restriction around all red-folder events on Forex Factory. Traders cannot open or close positions during this window, and profits from trades that violate this rule won't be credited in either the challenge or funded phase. If a take-profit executes during the window, it still counts as a violation.
One important carve-out: the news rule does not apply to Maven's Instant and Mini accounts. Positions opened more than 2 minutes before an event can be held through it without issue. Maven does not allow Expert Advisors (EAs) on any account type, which eliminates the possibility of automated news trading entirely.
Funding Pips
Funding Pips takes a lenient approach during evaluation: there are no news trading restrictions in the challenge phase, and you can hold trades over weekends. On Master (funded) accounts, a 5-minute blackout applies: profits from trades opened or closed within 5 minutes before or after high-impact events are not counted toward your balance.
There's one useful exception: trades opened at least 5 hours before a news event can be closed during the restricted window, and those profits still count. This means swing traders and longer-term intraday positions are largely unaffected. The Zero account, however, prohibits all trading and holding during news windows entirely.
News Trading Rules Comparison Table
The table below compares the news trading policies across major prop firms. Keep in mind that rules can change — always verify the current policy directly with the firm before trading.
| Firm | Blackout Window | Challenge Phase | Funded Phase | Penalty | Unrestricted Account |
|---|---|---|---|---|---|
| FTMO | ±2 minutes | No restrictions | No open/close on affected instruments | Forbidden trading practice | Swing account |
| FundedNext | ±5 minutes | No restrictions | 40% profit credit only | Reduced profit share; losses count fully | Futures accounts |
| The5ers | ±2 minutes | Varies by program | Soft breach on HighStakes | Profits deducted; account stays active | Non-HighStakes programs [UNVERIFIED] |
| Alpha Capital | ±2-5 min (varies) | Allowed with conditions | No open/close during window | Profits removed | Swing accounts |
| Blue Guardian | ±5 minutes | Allowed with restrictions | No open/close on affected pairs | Profits removed | None |
| Maven Trading | ±2 minutes | Restricted | Restricted | Profits not credited | Instant & Mini accounts |
| Funding Pips | ±5 minutes | No restrictions | Profits not counted | Profit exclusion; 5-hour pre-open exception | None (Zero account is most strict) |
If your strategy relies heavily on news-driven moves, prioritize firms with swing or futures account types that waive news restrictions entirely. The trade-off is often tighter drawdown limits or lower leverage, but the freedom to trade your edge is usually worth it.
Which Economic Events Are Restricted?
Not all economic data releases carry restrictions. Prop firms focus on high-impact events — the ones capable of moving markets 50 to 200+ pips within minutes. Understanding which events fall into this category prevents unnecessary surprises.
Tier 1: Almost Always Restricted
These events appear on every firm's restricted list and generate the most volatility:
- Non-Farm Payrolls (NFP) — Released the first Friday of every month at 8:30 AM EST. The single most volatile scheduled release in forex markets.
- Federal Reserve Interest Rate Decisions & FOMC Statements — Scheduled eight times per year. The decision itself and the accompanying statement both trigger massive moves across USD pairs, equities, and bonds.
- Consumer Price Index (CPI) — Released monthly, usually around the 10th-13th. Core CPI is the primary driver of inflation expectations and Fed policy bets.
- GDP (Gross Domestic Product) — Quarterly release with advance, preliminary, and final readings. The advance release carries the most impact.
- Central Bank Rate Decisions — ECB, BOE, BOJ, RBA, and other major central banks. Restrictions apply to the currency pairs associated with each bank.
Tier 2: Sometimes Restricted
These events are marked as high-impact on Forex Factory but don't always appear on every firm's restricted list:
- Unemployment Claims (initial and continuing)
- Retail Sales
- ISM Manufacturing and Services PMI
- Producer Price Index (PPI)
- Central Bank speeches (Fed Chair press conferences, ECB President remarks)
Tier 3: Generally Not Restricted
Low and medium-impact events like housing starts, consumer confidence, factory orders, and trade balance figures rarely trigger prop firm restrictions. You can typically trade through these without concern.
Most firms define restricted events based on the Forex Factory calendar's red-folder classification. If an event shows a red folder icon on that calendar, assume it's restricted at your firm unless the rules explicitly say otherwise. When in doubt, sit out.
How to Set Up Your Economic Calendar for Compliance
The most reliable way to avoid news trading violations is to build a pre-session calendar check into your daily routine. It takes two minutes and can save your account. Here's a practical setup:
Step 1: Choose Your Calendar Source
The three most widely used economic calendars for prop firm traders are:
- Forex Factory (forexfactory.com/calendar) — The industry standard. Most prop firms reference Forex Factory's red-folder classification directly in their rules. This should be your primary source.
- Investing.com (investing.com/economic-calendar) — Useful for a broader view with real-time updates and mobile notifications.
- FXStreet — Offers clean filtering by impact level and currency.
Step 2: Filter for High-Impact Events Only
On Forex Factory, click the filter icon in the top-right corner of the calendar. Uncheck everything except "High Impact Expected" (red folder). This strips out the noise and shows you only the events that matter for compliance. Set your timezone to match your trading platform.
Step 3: Cross-Reference with Your Instruments
A USD CPI release doesn't restrict EUR/GBP trading — it restricts USD pairs, gold, and US indices. Before each session, match the day's high-impact events against the instruments you plan to trade. If there's overlap, note the exact time and your firm's blackout window.
Step 4: Set Alerts 15-30 Minutes Before Each Event
Use your phone, TradingView alerts, or your broker platform to set reminders before each restricted event. A 15-minute warning gives you time to manage open positions, close anything too close to your targets, and step away if needed.
Step 5: Use a TradingView Indicator for Visual Warnings
There are free TradingView indicators specifically built for prop firm compliance. These overlay your chart with visual markers showing upcoming news events and the restricted time window, making it nearly impossible to miss a blackout period during active trading.
1. Open Forex Factory calendar, filtered to red-folder events only
2. Note all high-impact events for today and tomorrow (for overnight positions)
3. Check which currencies and instruments are affected
4. Calculate the exact blackout window based on your firm's rules (e.g., 8:28 AM to 8:32 AM EST for a ±2-minute NFP restriction)
5. Set phone/platform alerts for 15 minutes before each restricted event
6. Close or adjust any open trades that might hit TP/SL during the window
Common Mistakes That Trigger News Trading Violations
Even experienced traders get caught by news trading rules. Here are the violations that show up most often — and they're all avoidable.
1. Forgetting That Take-Profits Count as "Closing"
This is the most common trap. You opened a trade hours ago, set a take-profit, and walked away. NFP hits, the spike triggers your TP during the restricted window, and the firm flags it as a news trade. At firms like Maven Trading, this counts as a violation even though you didn't actively close the position. Before any restricted event, either widen your TP to clear the expected range or close the trade manually before the blackout starts.
2. Trading Correlated Instruments Without Realizing the Overlap
A USD CPI release doesn't just affect EUR/USD. It affects GBP/USD, USD/JPY, USD/CAD, gold (XAU/USD), and US indices like the S&P 500 and NASDAQ. Some traders assume the restriction only applies to the "main" pair and continue trading related instruments. Most firms restrict all instruments directly impacted by the event's currency.
3. Not Checking Rules for Each Account Phase
Many firms have different rules for the challenge phase and the funded phase. Trading news freely during your challenge and then carrying that habit into a funded account is a fast way to lose profits or trigger a breach. Always re-read the rules when you transition between phases.
4. Relying on Memory Instead of a Calendar
NFP is always the first Friday of the month — until it isn't. CPI is usually around the 12th — until it moves to the 10th. Relying on your memory of when events "usually" happen instead of checking the actual calendar is a risk with zero upside. Bookmark Forex Factory and check it before every session. For more rules traders commonly overlook, see our guide on common prop firm rules that traders overlook.
5. Assuming "Allowed During Challenge" Means "Allowed Everywhere"
At firms like FTMO and Funding Pips, the evaluation phase has zero news restrictions. Some traders build their entire challenge strategy around news spikes and then discover they can't replicate those results on the funded account. If news events are central to your edge, make sure the funded account supports it — or choose a swing/futures account type that does.
6. Ignoring Weekend and Overnight Gap Risk Near Monday News
Some high-impact events are scheduled for Sunday evening or early Monday morning (particularly from Asian and Oceanian central banks). If you hold positions over the weekend, a Monday open gap triggered by an RBA or BOJ announcement could push your account into violation territory — especially if the firm has weekend holding restrictions. For more on managing risk at prop firms, see our guide on prop firm risk management rules.
Practical Tips for Trading Around News Safely
Staying compliant with prop firm news trading rules doesn't mean you have to stop trading entirely on high-impact days. It means being deliberate about when you enter and exit, and building a buffer into your workflow.
Close Positions 10 Minutes Before, Not 2
Your firm's blackout might be 2 minutes, but spreads start widening and liquidity starts thinning well before the release. Closing at the last second introduces slippage risk and leaves almost no room for error. Give yourself a wider buffer than the minimum.
Trade the Post-News Reaction, Not the Initial Spike
The first 5-10 minutes after a major release are chaotic. Prices whipsaw, spreads blow out, and stop hunts are common. The tradeable move often develops 15-30 minutes later, once the market digests the data and picks a direction. By waiting, you stay outside the restricted window and trade a cleaner setup.
Keep a "News Trading" Journal Tag
In your trading journal, tag any trade that occurs within 30 minutes of a high-impact event. Over time, this data reveals whether news-adjacent trades are profitable for you, or whether they're costing you money and introducing unnecessary compliance risk.
Use Separate Accounts for Different Strategies
If you run both a technical strategy and a news-based strategy, consider funding separate accounts. Use a standard account for your non-news setups and a swing or futures account for news trading. This keeps your strategies clean and reduces the chance of an accidental violation contaminating a profitable account.
Review Your Firm's Rules Quarterly
Prop firms update their policies regularly. A firm that allowed news trading six months ago may have introduced restrictions since then. Check your firm's FAQ, terms of service, and any email updates at least once per quarter to stay current.
Create a simple spreadsheet with columns for: Event Name, Date/Time, Affected Instruments, Your Firm's Blackout Window, and Action Required. Update it weekly. It takes five minutes and eliminates guesswork during live sessions.