Tag: forex news

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Forex Course

184. Why Is It Important To Be Careful While Trading the News?

Introduction

Introduction

Introduction

Now that you know about scheduled news releases in the forex market, you must be excited. You probably think that you have the most foolproof way of trading in the forex market. You might have even gone to the extent of planning your trades to coincide with the high-impact indicators; because they significantly affect price action, you can collect a lot of pips.

Well, if you have thought and planned all that, forget it! To successfully trade the news in the forex market, you have to be deliberately methodical and calculative. If not, you may end up wiping out your trading account.

We’re not saying that you shouldn’t trade the news. Quite the opposite, you should, but only, and only when you understand the implications of the news release. Let’s, for example, take the release of a high-impact economic indicator.

Usually, when high-impact economic indicators are released, they are followed by extreme market volatility. The US unemployment rate is a high-impact indicator. Its latest release on October 2, 2020, at 8.30 AM EST came in positive at 7.9% lower than the expected 8.2%.

In this case, you’d expect the USD to be stronger than the EUR. But immediately after the news was released, there was some volatility that made the pair gain 11 pips before adopting a bearish trend.

Eleven pips may not sound like a lot. But if you have a small trading account and using high leverage, the chances are that 11 pips in the wrong direction can wipe you out.

Watch out for geopolitics

When trading the news as scheduled in the economic calendar, it pays to monitor geopolitical developments that are not scheduled, especially in the current climate of trade wars. Declarations by influential political figures may influence trends in the forex market. In such cases, if the news release of economic indicators coincides with such events, their impact may be watered down or exacerbated.

Another reason why trading the news may not go as planned is because the outcome of a news release could already be priced into the market. Forex traders are skillful at anticipating – especially when it comes to interest rate releases. If they anticipate that central banks are going to cut interest rates, they will adjust their trades weeks or months in advance. In this case, when the actual rates are released, their impact will not be as pronounced.

Bottom Line

We’re not saying you shouldn’t trade the news. Just take your time and familiarize yourself with the different types of economic indicators. Do thorough backtesting and have a trading plan on how you will incorporate news releases into your trading.

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Forex Videos

Is War Developing Between China, Taiwan & The USA! How To Trade In Times Of War!

https://youtu.be/XuDE2jKMbZc

https://youtu.be/XuDE2jKMbZc


Is a war developing between China, Taiwan, and the USA? 

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Is a war developing between China, Taiwan, and the USA?

Taiwan was a Dutch colony between 1624 and 1661, having been administered by China’s Qing dynasty from 1683 to 1895. But today, China regards Taiwan as a breakaway province and says it is determined to retake it. However, Taiwan’s leaders argue that it is a sovereign state, with its constitution, democratically-elected leaders, and about 300,000 active troops in its armed forces.

China has been piling the pressure on Taiwan’s President, Tsai Ing-wen, to acknowledge the “One-China” policy since before she took over the role in 2016. 


And with the 2019-20 crisis in Hong Kong, as a result of the China / Hong Kong  National Security Law, some protesters, fearing extradition to mainland China, and facing criminal charges, have been escaping to Taiwan, many with their passports confiscated, elect to take the perilous 370-mile sea voyage to Taiwan which has promised assistance to the people of Hong Kong, thus antagonising China. 

After decades of hostility between China and Taiwan, things started improving in the 1980s, and China took advantage by putting forward a formula, known as “one country, two systems” – such as implemented in Hong Kong – and under which Taiwan would be given significant autonomy if it accepted Chinese reunification.

Also, throughout 2018, China put pressure on international companies by forcing them to list Taiwan as a part of China on their websites. Those who declined were threatened to be banned from doing business in China.

In the meantime, the US has been supporting Taiwan, much to the annoyance of the Chinese Communist Party, with Washington sending its highest-ranking politician to hold meetings on the island because what it said was an “increasing threat posed by Beijing to peace and stability in the region.” The US approved an $8 billion sale of F-16 fighter jets to Taiwan last year, taking its fleet to over 200, also angering the Chinese government.  

In a more recent development, Chinese fighter jets have been entering Taiwan’s airspace. SU-30 fighters and Y-8 transport planes have been spotted over Taiwan during September 2020, fuelling tensions in the region.     

Japan, worried about the number of US and Chinese military exercises in the region over the South China sea, see the possibility of an escalated conflict perhaps as the result of an accident.

Should such a conflict between China and America occur, what might we expect from the financial markets?  Mayhem, confusion, and extreme market volatility, stock indices around the globe would fall, but especially within the United States, and we might see the Japanese yen and Swiss franc being bought as safe-haven assets.

China seems determined to retake Taiwan, as much as Taiwan appears to want to break away officially.  The Chinese government would very likely not back down, and I’ll poke a finger in the west by provoking them into military exercises while flying over Taiwan’s airspace, which China sees as its own.

 

This is a crisis that he’s not going to go away anytime soon.  It will undoubtedly escalate.  Traders are advised to keep an eye on the escalating conflict because it will likely lead to spikes in many asset classes.

 

 

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Forex Course

158. Where to Find Authentic Forex News and Market Data?

Introduction

Introduction

Introduction

Fundamental analysis is an integrated part of forex trading. It provides an exact logic and reason behind the movement of a currency pair. However, the fundamental analysis depends on several fundamental releases and news. Therefore, it is evident for a trader to know the source of this news.

What is Forex News and Market Data?

Forex news is economic, geopolitical, and financial news that may directly affect the price of a currency pair. Moreover, fundamental data are economic releases that show the current and upcoming economic conditions of a country.

The price of currency pairs depends on many factors, and traders evaluate it to anticipate the market movement. For example, if a country achieved its targeted inflation rate, and the central bank raised the interest rate, it will indicate stronger economic conditions that may influence traders to take traders in a specific direction.

However, it is essential to find the source where the forex news and market data are available.

Where to Find Forex News and Market Data

Forex trading becomes very easy nowadays as most economic news and market data are available on the internet as soon as it releases. Therefore, forex trading becomes very attractive to retail traders as they can operate all their activities from home with a computer and a stable internet connection.

Let’s have a look where we can find this information:

Forex Brokers

Many forex brokers provide integrated market news and an economic calendar where the upcoming economic releases and events are scheduled. It will update as soon as the news comes and will provide historical data. Some brokers provide exclusive technical and fundamental analysis based on forex news and market data, which is also helpful for traders.

News Portal

Besides the forex broker, there are many websites where forex economic calendar and events are released. It also provides technical and fundamental analysis based on the available information. However, some trading portals offer live charts with economic data.

Image Source: www.forexfactory.com

Forex Indicator

Besides the MT4 and MT5 trading platform’s stock indicator, several custom-based indicators show the upcoming news in a box within the price chart. When the news comes, it shows the result immediately on the chart. On the other hand, MT4 and MT5 have a built-in economic and fundamental news service, which is very useful.

Conclusion

It is not very hard to find forex news and market data as it is available publicly, and anyone can access it. However, the challenging part is getting the news immediately after release. The news’s timing may differ based on the quality of the internet connection and execution speed of the news providing website.

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Forex Videos

Donald Trump v Covid 19 – Forex Trading Tips!

 

 

 

Donald Trump v Covid-19, the fight is on, but how will the markets fare?

All the world’s a stage, wrote William Shakespeare in his comedy; As you like it. And one thing is true. The Donald Trump presidency has been theatre, the like of which we have never seen in politics in the western world. Let’s go back to December 2019; the US economy was buoyant with record employment, record stock market highs, and the US was a few weeks short of signing a massive phase one trade deal with China. Donald Trump was on the cusp of going down as the greatest American President ever, in terms of steering the US to economic glory.
Step forward a few months, and the global Covid-19 pandemic has all but reversed the economic fortunes for the US with massive unemployment, an economy in freefall, instability, and with the presidential elections just a month away, at the time of writing. Donald Trump and his management of the Covid crisis in the US now looks likely to leave a legacy of being one of the worst US presidents ever.


Love him or loathe him, President Trump has been a major critic of the Chinese government, who he blames for what he calls the China virus. He has spewed out vitriol against them in many statements, and this has led to threats of tariffs, sanctions, bans on Chinese companies operating in the US such as tik-tok, WeChat, Huawei for so-called security reasons, and now that he has had a taste of the virus himself, one can only imagine how things might be escalated from here, when and if he recovers.
Many would argue that Donald Trump testing positive for Covid is poetic justice for a man who consistently played down the seriousness of the disease, while criticising people such as his presidential opponent, Joe Biden, for wearing a mask, when he himself often refused to do so. In fact, it was likely that a recent event in the White House Rose Garden, regarding the nominee for the vacant supreme court judge, was very likely a super spreading Covid event, where many members of the Republican team are dropping like flies, as one by one, as they test positive for Covid.
People will say that Donald Trump had it coming, and it was only a matter of time and wonder how on earth the most secure building on earth, the White House, with all of its technology, and private hospital wing, could allow the President and so many of his aides and colleagues to become infected. This was probably down to sheer bloody mindedness by Donald Trump, who just didn’t take the disease seriously enough.


And getting back to the important presidential election on the 3rd of November, everything is now up in the air, with a quarantine of 10 days and a period of convalescence required, should President Trump shake off the disease, bearing in mind he is 74 and overweight and has a gruelling schedule that many much younger men would not be able to cope, with is it likely that he will be fit enough, should he recover, continue with the election campaign?


The financial markets will see great uncertainty regarding the prospect of President Trump returning for a second term to the White House. There are constitutional issues with regard to voting, which is already going on, with many ballot papers already having been returned, and if Donald Trump is not able to stand, questions remain about how that might affect votes for the second in command, Mike Pence. And with Joe Biden leading in the polls, institutional investors will be worried about extra regulations and higher taxes, should he win the presidential election. And with all this uncertainty, we can expect a great amount of volatility in the markets where institutions will be recalibrating their portfolios and where a risk-off event will take place, with stock markets edging lower, if not falling, and a great deal of volatility in the currency space, which might see a dollar resurgence. Because this event is unprecedented, it is really hard to call. But one thing is for sure; we will see extra volatility.