Forex News, Technical Analysis & Trading Tools
This week proved to be rough for risk assets as market players had to price in top tier less optimistic news & data, most notably jobs updates from the U.S. There are times when sentiment in the equity markets will be the precursor to major moves in the currency market. Before developing a ‘Trade the News” strategy, we have to look at which news events are even worth trading. Pullbacks from last week’s moves and positioning ahead of this week’s catalysts got traders pushing the major assets all over the charts. With not a lot of fresh catalysts to consider, the markets are positioning themselves ahead of anticipated data releases on Wednesday and Thursday.
Forex traders should familiarize themselves with the key event risks that heavily impact the major currencies. A one-touch option only has one barrier level, which generally makes it slightly less expensive than a double one-touch option. The same criterion holds—the payout is only made if the barrier is breached prior to expiration. This is a good option to buy if you have a view on whether the number will be stronger or weaker than the market’s consensus forecast. The BabyPips.com Economic Calendar highlights the important events and economic data that are being released by the countries with the most popularly traded currencies. Gold preserves its bullish momentum and trades near $2,580 after setting a new record-high slightly above this level.
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Generally, since the U.S. dollar is on the “other side” of 88% of all currency trades, U.S. economic releases tend to have the greatest impact on forex markets. The relative importance of these releases is generally dependent on the broader economic environment. In the post-pandemic years, traders have been paying close attention to inflation and interest rate decisions. Prior to the COVID-19 pandemic, the markets appeared more focused on GDP growth and employment figures. It is important for traders to understand the current economic backdrop.
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We’re also a community of traders that support each other on our daily trading journey. Expectations are already running high for a September Fed rate cut, but can the upcoming CPI release determine how large the reduction could be? We agree with markets that slowing US inflation over the summer has cleared the path for a faster “normalisation” of policy rates in the US. Choosing the appropriate currency pair is an important decision when “Trading the News”. While the markets react to most economic news from various countries, the biggest movers and most watched news come from the U.S. Despite the dollar’s initially velocity trade positive reaction to the strong readout, the data release was not enough to reverse the broader momentum of the euro.
August inflation data from the US could fuel the next directional move in the precious metal. UNH stock fell on Wednesday, Thursday falling reduced odds of Trump victory. Over the summer, the focus of the Fed has shifted from a singular emphasis on curbing inflation to now discussing the risk of causing significant damage to the labour market. Although these may not have as big an impact as the other news, it’s still worth paying attention to them. The United States still has the largest economy in the world and the U.S. dollar is the world’s reserve currency. Even if its position has been eroded by setbacks, imbalances, and weaknesses, the strength and influence of the US dollar will not be matched anytime soon.
Depending on what’s currently happening in the world, the relative importance of this event may change. The study found that the effect on returns generally occurs in the first or second day, but the impact does seem to linger until the fourth day. The impact on the flow of buy and sell orders, on the other hand, is still very pronounced on the third day and is observable on the fourth day. Crypto mining is the process by which new Bitcoin and Ethereum enter circulation.
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- With not a lot of fresh catalysts to consider, the markets are positioning themselves ahead of anticipated data releases on Wednesday and Thursday.
- Over the next day, the U.S. dollar gave back the prior gains and then lost additional ground to its European counterpart.
- The BabyPips.com Economic Calendar highlights the important events and economic data that are being released by the countries with the most popularly traded currencies.
Bitcoin price retested and bounced off from the daily support level of $56,000 this week. US spot Bitcoin ETFs posted $140.7 million in inflows until Thursday and on-chain data supports a bullish outlook. Bitcoin trades above $58,000 at the time of writing, adding 2% to its value this week. Ethereum hovers around $2,300 as WazirX exchange exploiter moves 5,000 Ether to a new wallet address and a crypto mixer.
Gold climbs to new record-high above $2,580
One of the great advantages of trading currencies is that the forex market is open 24 hours a day, five days a week (from 5 p.m. Sunday until 4 p.m. Friday ET), and only the best forex brokers can help you navigate the market. Since markets move because of news, economic data is often the most important catalyst for short-term movements. This is particularly true in the currency market, which responds not only to U.S. economic numbers but also to news from around the world. Here, we look at which economic numbers are released and when, which data is most relevant to forex traders, and how traders can act on this market-moving information. A double no-touch option is the exact opposite of a double one-touch option. There are two barrier levels, but in this case, neither barrier level can be breached before expiration—otherwise, the option payout is not made.
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The 10-year US Treasury bond yield stays in the red below 3.7% as markets reassess the odds of a large Fed rate cut, helping XAU/USD push higher. Brace yourselves for another exciting trading week, forex fellas! We’ve got no less than top-tier U.S. inflation reports and a central bank decision, plus U.K. The major assets were all over the place as traders priced in their Fed rate cut biases, U.S. political updates, and top-tier U.K. Remember that we are trading the news because of its ability to increase volatility in the short term, so naturally, we would like to only trade news that has the best market-moving potential for the currency market.
Over the next day, the U.S. dollar gave back the prior gains and then lost additional ground to its European counterpart. The Bank of Canada (BoC) cut its overnight rate by 25 bps to 4.25% today, marking the second consecutive rate cut in its monetary policy tightening cycle. August U.S. jobs data showed signs of cooling but remained net positive, potentially paving the way for a measured Fed rate cut in September. A hotter-than-expected core inflation reading sent the U.S. dollar higher, but risk appetite soon took over and limited the Greenback’s gains. Gold price is sitting at the highest level on record near $2,570, with buyers contemplating the next move amid sustained weakness in the US Dollar and the US Treasury bond yields.
Liquid currency pairs give us reassurance that our orders will be executed smoothly and without any “hiccups”. Being aware of upcoming key event risks can help avoid being on the wrong side of the market. We introduce people to the world of trading currencies, both fiat and crypto, through our non-drowsy educational content and tools.
Traders now look forward to the US Michigan preliminary Consumer Sentiment data for fresh directives. For example, by selecting only “HIGH“, the Economic Calendar will only display the events that have historically been known to produce market volatility. News traders need to be mindful not only of the potential significance of a particular beat or miss but also of the broader economic environment and fbs forex review market trends.
The table below lists the approximate times (in Eastern Time) of the most important economic releases for each of the following countries. These are also the times when traders pay extra attention to the markets if trading based on news releases. Now that we know which news events and currency pairs to trade, let’s take a look at some approaches to trading the news. Now that we know which news events make the most moves, our next step is to determine which currency pairs are worth trading. Tradable currencies span the globe, and you can handpick the currencies and economic releases you want to pay particular attention to.
