With how fast-moving the currency market world is, it's extremely important for new traders to take the steps to learn about various economic indicators and Forex news events and releases that shape the markets. But getting an idea of what information to look for, what to do with that information once you get it, and how to implicate it into your daily trading strategy, can be very overwhelming when it comes to new traders, especially. By educating yourself on what to do, traders can become profitable and on the right path to long-term success.
The number one market news event you need to make a part of your daily trading routine is checking the Central Bank Rate Decision. Various Central Banks of the world's economies meet each and every month to decide over the interest rates that they are responsible for. They make the decision on whether they need to leave the rates unchanged, raise or lower the rates. The outcome of their decision is important because it affects the currency of the economy, which will affect traders. When they increase the rates, (increase in value) means you are dealing with a bullish currency and when you see a decrease in rates (decrease in value) means you are seeing a bearish currency. If they decide to leave the rates unchanged, that means you could be dealing with either bullish or bearish rates, all depending on the economy at the time. This is important information because some of the best and most profitable trades you can make come from information on rate decisions.
You should also be actively checking GDP (Gross Domestic Product) which is an important indicator of economic health in a country. A country’s central bank has expected growth outlooks each year. This determines how fast a country should grow, which is measured by GDP. When GDP falls below market expectations, currency values tend to fall, and when GDP does better than expectations, currency values tend to rise.
Another event you need to be paying close attention to is Consumer Price Index. CPI is the most widely used inflation measure out of the various economic indicators. It gives you information about the historical average prices paid by consumers of market goods and details whether the same goods are costing more or less for consumers. This helps guide them in their rate and policy changes. Another event you need to be checking thoroughly is Unemployment Rate which is crucial to markets given its importance to Central Banks which use this information as an indicator of the overall health condition of an economy. Higher employment leads to interest rates that are rising, as Central Banks strive to balance inflation with growth and than the outcome is a lot of market attention from traders.
The Apiary Fund reviews these economic events periodically. Once you get into the habit of looking for these, you are setting yourself up for placing more well thought out trades with more information to back you up. You want to prepare yourself for not only what the news events mean, but how the market will respond to that release, and how it will directly affect you making money, and creating many more trading opportunities for yourself.