Trading the forex market is all about strategies. Investors make judicious plans about what commodity to trade, when to trade it, and how it should be traded. If it all works out well, that is when a trader is said to have a successful trade; which is the aim of trading the forex market in the first place – to make profits. That is why it is important to make sure that forex data used in speculation are current and correct. One wrong twist of information can cause a devastating loss for a trader.
WHAT IS FOREX DATA?
Forex data is made of information about forex that can help one spot a profitable opportunity that can result to profits. Such information requires a bit of research on the path of the trader to be sure data provided correlates with the market condition. One will need to have articulate analysis skills to be able to do this. If not, it is better to go for cost effective forex data as offered by professional analysts, brokers, or traders. One good benefit of this is that it enables one to trace how the banks trade and possibly spot a pattern with which to trade with.
Forex data consist of the following
HISTORICAL BID AND ASK PRICES:
Forex price data of the past can be helpful. The more far back it goes, the better. One can download up to 10 years of bid and ask prices from the past and use them to develop trading strategies.
FOREX APPLICATION PROGRAMMING INTERFACE (API):
With forex APIs, one can develop back test, and automate trading strategies in different software environments. For instance, one can back test a strategy developed from studying historical bid ask prices to find out if it worked in similar market condition in the past; which will go a long way to show how it will work on current market situations.
With this data, one can find out if a market move is as a result of heavy or weak demand in forex transactions that took place in the past. It is possible to also view different levels of real time liquidity and volume, and the market sentiment.
While history of trades in the past may be important for trading the forex market, it is also important to keep in touch with what may be happening currently. This can be done by following information about forex events in the forex calendar; particularly those of them that have to do with bank decisions about one commodity of the other.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.