Read this guide I have compiled for you below. It is important to understand WHY the news moves the currencies. Enjoy
Have you ever noticed that there are times when a currency pairs price just shoots out in a specific direction, only to do a quick google search and you find out that a major politician said something, or the central bank increased/ decreased interest rates? These events occur often. and this is what entails fundamental analysis (trading the news).
This form of analysis is a branch of a greater tree called Fundamental Analysis.
In this article we will investigate the above questions and provide you with a framework to deal with and be equipped to operate in the forex market, trading the news.
The aim of using this form of analysis is to come to a consensus on the “actual” value of a security.
The word actual is in inverted commas because it is what you would have determined the price should be based on your analysis.
This price is then compared to the current market price and IF there is a huge difference fundamental traders then enter the market based on this premise.
is the number that the specific news event had released in a previous period. If the news is released monthly, then the previous value refers to the same news event released in the previous month. If the news release is quarterly, then the previous number is the news release of that specific news 3 months back, so on and so forth.
Now that we understand the definitions and the numbers of reading a news release,
Let’s investigate how you would actually trade the news, and potentially profit from this market volatility.
Therefore there is no universal trading strategy to trading the news. You will need to develop your own per news event, per chart.
For the sake of completeness it will be shown to you how to find the key news events worth trading and how to also find the news events that are not worth your time.
Forex trading is probably one of the most profitable sides hustles you can grab today. In fact, if it wasn’t so profitable we wouldn’t be having more than $5 trillion daily traded value. But that’s beside the point. I’m pretty sure you want to find out how much you can expect from about a week or a month of trading Forex.
Well, it’s not that easy to answer the question so let me bring in a story for you.
Meet Nathan. Nathan is a father of two and has a stable job as an accountant in New York. He’s relatively successful and is able to bring in about $100,000 a year as income for his family.
faruk replied
248 weeks ago