Forex factory can simply be defined as a calendar used by traders to gain necessary information on stock news and stock prices. The calendar exposes traders to the ideal world on marketing-moving events and financial markets. Every individual who has an interest in Forex trading is advised to adopt this calendar due to its accuracy and effectiveness. This is a very important tool to all traders regardless of their market approach. In most cases, technical traders assume this calendar sighting that it’s not of great importance to them due to their way of operation. The truth is that every trader needs it, for it allows you to know what type of news will be released in the market.
Most traders are faced with the challenge of utilizing this calendar. One would ask, how do I get started? It’s very important that a trader gets to understand how to utilize this calendar. Failure to which will not yield many benefits. The first step is getting to familiarize with the calendar. One should understand how to navigate it. The calendar is made up of nine sections. These sections provide for the date, time, currency of operation, impact, detail, actual figures forecast previous figures and finally the graph.
After familiarizing with the calendar it is important that time is set. This time should be set by one’s time zone. Once this is done work towards filtering important events. Filtering of events allows synchronization of news according to one’s time zone. Filtering of events also allows one to display currency pairs and news of interest. This is very important because it minimizes or rather reduces the number of activities on one’s screen which would otherwise cause confusion if allowed to run at the same time.
As a trader ensure that you set a time frame. This defines the span of time one would wish to receive important information. A time frame can range from one single day to a full month. Research indicates that the best time frame one should choose is a week. This allows a trader to prepare himself rather than having to rush after every 24hours.
It is not enough that this calendar has been put in place, mastering its use is a must have skill. So how can this calendar be effective to a trader? First and very important is being able to select crucial headlines. Remember the main aim of this calendar is to gain information on market-moving issues. One needs to filter news with great impact in the market to reduce volatility. There are very crucial topics that a trader cannot afford to ignore. These headlines include; Unemployment rates, announcements done by central banks in regards to rates, Final Gross Domestic Product, Nonfarm Payrolls and news on monetary policies.
Secondly, being able to trade with the news availed in the market. The calendar acts as a tool in guiding one on when to expect market news. This knowledge is important for it leverages a trader during high volatility periods.
Thirdly a trader should be able to make profits by use of this calendar otherwise it will be irrelevant. There are different methods a trader should use to make recognizable profits. Put great focus on issues that highly affect the markets. This is because such announcements determine the type of trading one should focus on. Secondly, understand what number is expected then try to link it to that which has been released. The kind of deviation from these numbers will help you as a trader understand the market potential.
Forex Factory provides detailed information on how deviations affect a country’s currency. It is therefore important to keenly go through those details that have been provided by the calendar. Try to understand how prices will be affected by these announcements. This will help you know the best time to sell or buy a certain currency. This simple guide will help you make informed decisions during your trade period. In conclusion, a trader needs to first understand the importance of this calendar before adopting it. Any individual with interest in Forex trading regardless of the type of operation should adopt this calendar for it is a sure avenue to making profits.