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22 Apr 2013

 

As being a great foreign exchange trader, a forex calendar should be an important part of your daily trading routine. Even as a technical analysis trader, as many Forex traders are, you shouldn't overlook the economic news. In reality, looking for the upcoming scheduled news on a Forex calendar should always be first thing you do before selecting entering a trade. Knowing the time of high impact news before it happens enables you to decrease your risk. During these risky market conditions, you may want to stay on the sideline or make the most of them using fundamental analysis trading methods. Trading Forex from the perspective of fundamental analysis is not a popular option, but when you combine it with your technical analysis, you may have a tremendous advantage in the Forex market.

Fundamental analysis generally considers the economic and political changes in the Forex market. It may also give you a better understanding about valuable financial reports and indicators. Unemployment rates, interest rates, PMIs, and gross domestic products are only a few of the most important economic indicators in the foreign exchange market. Once you discover how these reports can affect a specific currency, you can make a trading technique to leverage the volatility in the market. One of the popular tips on how to trade the news is to trade the initial spike that comes after a high impact news report; especially if the actual release number differs significantly from the forecast number.

For example, if we're expecting the US Non- Farm payroll news to be released at a forecast of 300K. If the actual release number comes out better than expected at 370K and above, we'd jump in on a trade to buy the US dollar against other currency pairs. However, if the actual release number comes out worse than expected at 230K and below, we will enter intoa trade to sell the US dollar. In this illustration, you will recognize that we are looking for a 70K of deviation. In accordance with historical data from prior NFP releases, this is actually the minimum difference required for the market to move 50 pips or more for at least 75 percent of the time.

There are plenty of well- recognized Forex sites and blogs that offer free economic calendars which can be updated with the latest economic news and figures as soon they are announced. One fantastic source for Forex fundamental analysis is CurrencyNewsTrading. com that provides a fantastic Forex calendar that features the scheduled news events in a weekly basis. Most online Forex calendars color- code each news event by its potential impact, however the CNT’s Forex calendar displays just the high impact news that historically are the most tradable. It also indicates the tradable deviation for each event, combined with the possible pips movement range, related market headlines, and also the different currency charts showing the market movement as a result of each particular news report.

By using a Forex calendar, you will know in advance the time of news reports that are likely to affect a particular currency, and it should be a vital tool in your daily trading so that you can manage your risk. You can also benefit from the market volatility right after these news reports by utilizing fundamental analysis strategies. To start, check out CurrencyNewsTrading. com to discover news trading and to obtain the hottest tools to help you to make better choices in the Forex trading and therefore make you much more successful.

 



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