Fundamental Analysis: What Really Moves The Forex Market

As being a great currency exchange trader, a Forex calendar must be a significant part of your every day trading habit. Even as a technical analysis trader, as many Forex traders are, you shouldn't forget about the economic news. In fact, looking for the upcoming scheduled news on a Forex calendar should be first thing you do prior to choosing entering a trade. Being aware of the time of high impact news prior to it happens enables you to reduce your risk. During these volatile market conditions, you might wish to stick to the sideline or take advantage of them applying fundamental analysis trading strategies. Trading Forex from the perspective of fundamental analysis is not a common choice, but when you combine it with your technical analysis, you could have a tremendous advantage in the Forex market.

Fundamental analysis generally takes the economic and political changes in the Forex market. It may also provide you with a much better understanding about valuable monetary 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 currency market. Once you know how these reports can impact a specific currency, you can create a trading technique to leverage the volatility in the market. The most favorite tips on how to trade the news would be to trade the initial spike that comes after a high impact news report; particularly if the actual release number varies significantly from the estimate number.

For example, if we are expecting the US Non- Farm payroll news to be released at a forecast of 300K. If the actual release number comes out a lot better than expected at 370K and above, we will jump in on a trade to buy the US dollar against other currency pairs. But, if the actual release number comes out worse than anticipated at 230K and below, we'd go intoa trade to sell the US dollar. In this example, you will notice that we are looking for a 70K of deviation. Based on 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 lots of well- recognised Forex websites and blogs that offer 100 % free economic calendars that are updated with the latest economic news and figures as soon they are announced. One excellent source for Forex fundamental analysis is CurrencyNewsTrading. com that provides a great Forex calendar that displays the scheduled news events in a weekly basis. Most online Forex calendars color- code each news event by its potential impact, yet the CNT’s Forex calendar displays only high impact news that historically are the most tradable. Additionally, it indicates the tradable deviation for each event, combined with the potential pips movement range, related market headlines, and also the different currency charts featuring 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 will probably influence a particular currency, and it should be a vital tool in your daily trading so that you can manage your risk. Also you can benefit from the market volatility immediately after these news reports by utilizing fundamental analysis strategies. To begin with, go to CurrencyNewsTrading. com to discover news trading and to obtain the hottest tools to help you to make improved decisions in your Forex trading and hence make you far more successful.