Forex traders react to macroeconomic news most often. When news is released that indicates a shift in the balance of power between dovish and hawkish central banks, it can affect currency pairs. News related to employment and unemployment rates will affect the price of currencies. Economic rumors are often released minutes or hours before the official release, causing short-term trader action and lasting impacts on market sentiment. Here’s how to read the impact of macroeconomic news in forex trading.
Western New York Economic News provides commentary on the Buffalo-Niagara Falls Metropolitan Statistical Area’s economy and compares that region to New York State. This newspaper is published by the Economics and Finance Department of Canisius College. Those interested in the local economy can subscribe to its RSS feeds and podcasts. This news website also features the latest economic statistics and forecasts. It is worth checking out if you live in Western New York.
The biggest market players often don’t wait for economic reports to act on them. They take advantage of trading opportunities before reports are even released, so it’s important to monitor recent economic reports and watch how markets react to them. Using pivot points can help you identify significant support and resistance levels and help you set your targets based on these levels. You can also test the market environment with virtual money and test the news’ impact on your trading strategies.
CNBC Breaking Business News is a flagship CNBC financial news app. It offers real-time stock quotes and market data. Users can also watch full episodes of CNBC shows while reading business news. TheStreet app also includes a proprietary stock rating model. It also offers stock analysis, market data, and breaking news alerts. It also features articles written by award-winning Bloomberg journalists. You’ll never be left out of the action.
The currency market is comprised of several different players: corporations, governments, and institutions. Speculators are a huge part of the market, accounting for over 90% of the volume traded. These investors buy currency in anticipation of rising interest rates. Commercial banks, on the other hand, put their money into economies that have a favorable outlook. For example, an economic news report on the US unemployment rate will boost the USD/CHF currency pair.
A trader can capitalize on a news report to profit. If the market expects a job growth of 120,000, the release will likely cause a significant move. On the other hand, if the market believes the U.S. economy will lose half its jobs, it will move the markets significantly. If this is the case, a news trader can profitably enter the market with the highest probability of a breakout move. With the current volatility, it’s difficult to sustain a trade after the release of an economic report.
Several indicators affect the currency market, including interest rates, inflation, unemployment, retail sales, and GDP. Economic announcements alert traders to changes in the economy that may affect their trading strategies. This information will often determine market sentiment. Therefore, it’s important to follow economic news in real-time to avoid being caught off guard. In trading, it’s vital to have a clear understanding of how economic news affects currency values. It’s critical to keep in mind that the impact of news is often subtle and largely dependent on how the news has been interpreted.
Nonfarm payrolls data is a key indicator of employment in America. If the number is higher than the previous month, this will be positive for the currency. However, if it falls short of that, the news will affect all currency pairs that use the U.S. Dollar. For example, a higher NFP forecast will affect the USD/JPY pair, while a lower number will impact EUR/USD. The forecast of NFP is important to traders.
The US Federal Reserve has yet to accelerate its monetary policy, although it has signaled a 50 basis point increase next week. The central bank is gradually easing policy and will sell assets as soon as it is able to. In addition, if inflation continues to slow, investors are more likely to move to safer investments, including real estate and bonds. This could mean higher interest rates and higher volatility in the economy. The risk of recession remains high, so investors should remain alert to economic news.