Since forex market remains opened 24 hours a day and 5 days per week, forex news releases are of great advantages in the currency trading. The information that traders receive from news caters short-term profitable trades. But this particularly depends on traders how he/ she would make use of it.
Forex news forecast presents not only economic news but it will highlight the future prospects (with statistical data) of GDP, unemployment rates and other factors that are responsible for the change in exchange rates.
Importance of forex news forecast:
Those who trade news will get plenty of opportunities to make profitable trades. If you are a newcomer and looking for the same, then check relevant facts below how to trade news:
- Focus on Currency Pair:
Traders mostly trade on eight major currencies. You have to focus on the currency pairs that are likely to produce profits. The actual effect of this news will be seen when you would be able to grab opportunities with both hands.
- Focus on Key Releases:
Every forecasting of currency will have certain criteria to be fulfilled. It is important that one should focus on the key releases of particular currency pairs. Depending on the current status of the economy of a country, its exchange rate will be changed.
Some of the key releases include:
- Interest Rate:
Central Bank changes the interest rates as per the current economic status. This is a factor that is also affected by the inflation. Traders should focus on its changes in order to understand the market movements.
- Inflation Rate:
With the higher inflation rates, a country’s purchasing power will get reduced. This is a factor that tells whether trader should place a short or long position.
- Unemployment Rate:
Unemployment rates can significantly affect forex news forecast. Since forecasts are done for either quarterly, half-yearly or annually, this news tells the approximate figure that will likely to change exchange rates.
- Retail Sales:
The sale of products is another important factor. Whether supply and demand of goods and services increase or decrease, it will change trading strategies. Traders should focus on the rate of increase and decrease to determine whether to trade or not.
- Trade Balance:
The balance of trade should be maintained between two countries. Otherwise, this will deteriorate the country’s economic status. Forex news forecast is something that should not be ignored. Every trader should take advantage of making profitable trades using the same.
- Focus on Implementing Strategies:
The above information will make you sure about the recent and future prospects. Since forex market is for everyone, newcomers enter into the market every day. In this regard, the effect on returns seems to be changed vigorously within four days of consolidation.
It is important to take the support of forex news forecast, but you should not forget to linger until fourth day. This will surely produce some impact on observable trades. The most common way to trade after looking at news will be to look for consolidation period ahead.