How to Trade Forex on News Releases

Forex trading is advantageous since the market is open 24 hours a day, five days a week (Sunday, 5 p.m. to Friday, 4 p.m. ET). Because news moves markets, economic data is frequently the biggest short-term trigger. In the currency market, U.S. economic figures and global news are important. We examine which economic numbers are issued and when, which data forex traders should focus on, and how traders might act on this market-moving information.

Which currencies to prioritize?

Most currency brokers offer at least eight main currencies, so forex traders may always use economic data to make smart transactions. Nearly every daily (excluding holidays), the eight most-followed countries post seven or more data points. Thus, news traders have many options. Most traders know the eight major currencies:

1. US dollar
2. Euro
3. British pound
4. Japanese yen
5. Swiss franc
6. Canadian dollar
7. Australian dollar
8. New Zealand dollar

There are several liquid currency pairs from the eight major currencies:

1. EUR/USD
2. USD/JPY
3. AUD/USD
4. GBP/JPY
5. EUR/CHF
6. CHF/JPY

Easy-to-trade currencies exist worldwide. This lets you choose which currencies and economic releases to follow. Since the U.S. dollar is on the “other side” of 90% of currency trading, U.S. economic releases usually have the greatest impact on FX markets.

Trading news is harder than it seems. The consensus figure, whisper figures, and report modifications are all essential. Some releases are more essential than others, depending on the country releasing the data and the release’s relative importance.

When Are Key News Releases?

Figure 1 shows the estimated Eastern Time times of the most major economic releases for each country. This is also when forex traders pay greater attention to the markets, especially when trading news releases.

Figure 1: Times at which various countries release important economic news

What Are the Most Important Releases?

Before trading news, you must know which releases are expected that week. Second, determining which data matters is crucial. Interest rates, inflation, and economic growth, such as retail sales, manufacturing, and industrial production, are most important:

1. Interest rate decisions
2. Retail sales
3. Consumer or producer price inflation
4. Unemployment
5. Industrial production
6. Business surveys for opinion
7. Consumer confidence polls
8. Balance of trade
9. Manufacturing industry surveys

These releases may vary in relevance depending on the economy. Unemployment may be more significant than trade or interest rates this month. It’s crucial to follow the market’s current focus.