Try this 1500 pips a day Strignano’s Forex Signals from heaven. One new member made $15,000 in just 24 hours. Learn this 10 minute a day Swing Trading Strategy. Get these FREE Forex Scalping Cheatsheets. If you trade currencies than you should be aware of the importance of the economic data releases. As a forex day trader, you should factor in the economic report releases into your trading strategies.
Now if you use range trading as your primary day trading strategy than you must stay out of the currency market when a very market moving report such as the Nonfarm Payrolls (NFP) is released. However, if you are a breakout trader than you would be looking for the day when an important economic report is released to drive some sizeable price action.
Now, suppose you use an automated trading system like a forex robot than knowing some fundamental analysis is good for you. Knowing when to turn on or off the automated system based on the incoming economic releases can have a big impact on the overall performance of the trading strategies.
Fundamental traders tend to thrive on the release of economic reports. The most market moving economic reports are the US economic reports. Almost something like 90% of the currency transactions in the global currency markets are done against the US Dollar either as a base currency or counter currency.
Now, you must know this fact that not all economic releases are created equal. Some economic releases may have a significant and lasting impact on the currency markets while others may have no effect.
Since US Dollar is the most heavily traded currency in the world, you should be aware of the US economic releases that have the potential of moving and shaking the currency markets. The most market moving economic report right now is the NFP Report. This has become important more so with the recession in the US economy and rising joblessness.
When the NFP Report is released the market reacts in a knee jerk manner for the first five to ten minutes and try to compare the actual with the expected. Once the market has digested the unexpected, things starts to settle down and volatility decreases.
The other most market moving economic release is the FOMC Meeting releases. FED is responsible for setting the interest rates in the US economy. FOMC (Federal Open Market Committee) Meeting decides whether to increase or decrease the interest rate in the US economy.
Now, the market is always watching. Analysts are following what is happening behind the scenes in the FED that might result in a interest rate increase or decrease. What the market does not like is a surprise or the unexpected. So you need to be aware of the economic release calender if you are a day trader!
