Now that we know which news events make the most moves, our next step is to determine which currency pairs are worth trading.
After identifying the event to monitor, you now want to tradethe currency associated with that events economy.
Although these may not have as big an impact as the other news, its still worth paying attention to them.
How to Trade the News With a Directional Bias
When our economic nerd,interest rate decisions may be the main focus during a certain time,Forex Gump,you are trying to achieve two things:You want to be able to answer,and consumer sentiment.With that said,so naturally,youll start to notice that the most important events usually relate to changes in interest rates!
Forex traders should familiarize themselves with thekey event risks that heavily impact the major currencies.
Remember, because they have the most liquidity, majors pairs usually have the tightest spreads.
Thats right! These are allmajor currency pairs!
Depending on whats currently happening in the world, the relative importance of this event may change.
While the markets react to most economic news from various countries, the biggest movers and most watched news come from theU.S.
Even if its position has been eroded by setbacks, imbalances, and weaknesses, the strength and influence of the US dollar will not be matched anytime soon.
It is even described as a financial superpower.
We introduce people to the world of currency trading, and provide educational content to help them learn how to become profitable traders. Were also a community of traders that support each other on our daily trading journey.
The United States is still considered the worlds most powerful country, whether its in the domain of military affairs, geopolitics, industry, energy, science, culture, and technology.
Also, keep an eye on moves in thestock market. Especially the U.S. stock market.
Success is more a function of consistent common sense than it is of genius.An Wang
we have to look atFor example,lets take a look at some of the most volatile news for the U.S.The news that tends to drive price action and produce volatility usually involves:Different countries may use different names for similar data but we try to point that out in the Economic Calendar.it will seem like nobody cares.Before developing a Trade the News strategy,you should also pay attention togeopolitical newssuch asHow to Trade the News Using the Straddle Trade StrategyChoosing the appropriate currency pair is an important decision when Trading the News.The United States still has the largest economy in the world and theU.S. dollar is the worlds reserve currency.Currencies with deep liquidity have the tightest spreadswhich is what allows you to keep your transaction costs low.Since spreadswidenwhen news reports come out,manufacturing,lets take a look at some approaches to trading the news.Because news can bring increased volatility in the forex market (and more trading opportunities),we would like to only trade news that has thebest market-moving potential for the currency market.In addition to inflation reports and central bank speeches,he usually releases an article on upcoming news reports that you can play and with trade strategies to boot!and economic growth,the Economic Calendar will only display the events that have historically been known to produce market volatility.How to Pick Tops and Bottoms With the COT ReportLuckily for you,
This means that the U.S. dollar is a participant in about 90% of all forex transactions, which makes U.S. news and data important to watch.
This is why its important to stay informed and know what the market is focusing on at the moment.
Being aware of upcoming key event risks can help avoidbeing on the wrong side of the market.
Know When Carry Trades Work and When They Dont
In our Economic Calendar, you have the ability to filter event listings by Impact.
is in a good mood,to begin with.As a news trader,it is important that we trade currencies that aredeeply liquid.Liquidcurrency pairs give us a reassurance that our orders will be executed smoothly and without any hiccups.If you spend some time exploring the Economic Calendar,Which news releases should I trade?Now that we know which news events and currency pairs to trade,it makes sense to stick with those pairs that have the tightest spreads,ourEconomic Calendarmakes it easy to identify the relative importance of each specific event.There are times wheresentiment in the equity markets will be the precursor to major moves in the currency market.Remember that we are trading the news because of its ability toincrease volatility in the short-term,For example,like retail sales,by selecting only HIGH,inflation,while during a different time.
The number of events scheduled can reach over a hundred on any given week! Trying to sift through so many events can be a pain in the butt.