Tools Needed to Trade Forex News
Trading forex based on forex news is what all fundamental traders do and there are a number of technical traders who also use forex news when trading. It is important that you find out what tools you need to trade fundamentally. You should also consider the news items that you have to look at when you are trading fundamentally.
Economic and Political Forex News
Many new traders believe that economic news is the only forex news that they have to look at. This is not actually true because political news and news relating to commodities are also very important. The level of impact that the news has will depend on the currency you are looking at and the importance of the news.
Each day there are hundreds of news releases and a fair number of them should be ignored. There are monthly and quarterly economic reports that you need to take note of because they have a large impact on the market. The political news you need to look at is the elections and any policies coming into place that could affect the stability of the country.
A Forex Calendar
When you are looking at news you should know about the tools you need. One of the best tools you can use is a forex calendar. These calendars will list the releases which are coming up and what level of impact they will have on the market. Most calendars will classify the news as high, medium or low impact. Most traders concentrate on the high impact news and certain medium impact releases. The low impact releases are generally ignored because it is felt that the impact will be mitigated by other forex factors.
The calendar can also be filtered to show the news releases of a single currency only. It is important that you look at the news releases of both currencies in your currency pair. A lot of new traders make the mistake of only looking at one currency.
A News Feed
While having an idea of when news is going to be released you should also be aware of any breaking news. Breaking news can have a serious effect on the forex market if it is related to how stable the country seems. A lot of integrated trading platforms will have a news feed. However, most platforms do not have a good news feed and you will have to look elsewhere.
Many of the major news agencies will have a news feed that traders can use. Of course, you need to verify that the feed is geared toward forex traders and not stock traders. The news that a stock trader will use is different to the forex trader as it relates more to what is happening to companies.
Some news feeds are free to get while others require a payment. Most of the paid services have a monthly subscription fee which you can pay through a number of methods. You should check to see if the service you are going to get is worth the price you are paying. The best way to do this is to look at what other traders have to say about the service.
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