Using of the Economic Calendar to Increase Profitability
Modern trader is not just a market fighter, first of all he is a serious
analyst with diverse interests. And there is nothing more important
than information for the analyst. Professional traders are interested in
almost everything about the world economy: from the prices for retail
goods and presidential elections, to the hostilities and natural
disasters. You need to see, hear, read and realize on time everything,
that can affect the financial market.
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The economic calendar of the Forex market
allows you to collect together all the important global financial news
practically at the time of publication. Wherein, calendar not only keeps
the real history, but also ranks them in order of importance and power
of influence on the market - everything you need for analysis and
successful Forex trading. The history of the economic data and forecasts
of analysts are stored there as well. Usually online calendar is
published before the opening of the trading week, and the output of the
main regular data planned in advance for a period of several months and
is constantly adjusted in accordance with the current situation.
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Economiс Calendar |
Using the economic calendar for trading takes place the following way.
Each announced economic event has at least three meanings: the event,
the consensus (forecast) and the previous meaning. Exactly the deviation
of the event, firstly - from the analytical prediction, secondly, from
previous data that can be adjusted relative to the release of the
previous period is valued.
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Economic Calendar Settings |
If the forecast by the fact of publication is justified, i.e., coincides
with the calculated (predicted) values, the market reaction will often
be mild or be absent at all. If actual data differs from the forecast,
the market gives a sharp speculative shot, and the greater the
difference, the stronger this reaction is. Global news: international
events, statements and press conferences of the key figures of the
financial market, the statistics of the leading countries provide an
effective response practically on all the trading instruments.
When the news come out better than expected (for a country's currency
output), it is usually recommended to open a buy order, if worse than
forecast – sell one. If the values match (rare, but it happens!) - keep
calm and neutral trading.
If the trader knows the time of the news beforehand, he can plan his
activities, in particular, the moments of entering the market or closing
the position. The principle of "buy the rumor, sell the news" in
practice means that the market starts to respond to the information in
advance, and at the time of publication may go in the opposite
direction, forming a speculative market "spike". Everything happens
within a few minutes for small deposits and such situation is extremely
dangerous. Economic calendar warns in advance, when the news will be
released, that allows to close the already opened positions in time or,
conversely, to try to squeeze a profit from a quick movement, if the
trader is ready to a greater risk.
Every financial resource offers economic calendar, which can be with
different design, and sometimes functional content, but there are some
signs, which characterize precisely quality calendar:
...the economic calendar will be helpful fellow guide for you on your road to profits....
First of all, the Forex economic calendar must be complete, relevant and constantly updated, that is, to have direct access to news sources.
The interface must be understandable, visual and functional, without advertising tricks and other irritating elements.
Software implementation calendar must support a logical system of
various filters for information with the ability to save the settings in
personal profile of each user.
Finally, to summarize the above: always seek to understand what news
mean for the market in general and specifically for your trading
instrument, analyze historical data, consider the psychology of the
market behavior of the crowd at the time of the news release and then
the economic calendar will be helpful fellow guide for you on your road
to profits.