We allow news trading on challenge accounts.
However on all the simulated funded accounts, trading during high-impact news events, also known as red folder news, is restricted during the 8-minute window (4 minutes before and 4 minutes after). You cannot open and close any trades during the 8 minute window. You are allowed to hold trades during the news.
If any prior trade taken on the account hits take profit during this 8 minute window, profits earned from such trade will be subject to removal, without any account violation.
News trading rule on funded accounts is not applicable to any trade opened 4 hours prior to the news event.