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Forex economic calendar

June 23, 2020

June 23, 2020

Forex economic calendarOleg Tkachenko

What is the forex news calendar and how to use it to make profits?

Major fundamental events that influence foreign exchange rates. Examples of news trading based on the economic calendar.

[The economic calendar][1] is the main tool used in fundamental analysis. This is the list of major forex economic events that can influence foreign exchange rates. Read on about the important economic events that traders track, how they influence foreign exchange rates, and how you can make money trading the news.

Ways to use the economic calendar to trade forex

Fundamental analysis suggests Forex trading based on economic data releases. Macroeconomic and sectoral statistics, economic indicators, central banks’ statements, other economic reports are the factors that can radically change the market sentiment, and so, it influences the forex rates, commodities or securities. Traders like fundamental analysis and the forex fundamental announcements calendar because it, unlike technical analysis, doesn’t require deep knowledge of technical indicators. So, news trading is suitable for all investors. The major tool of “fundamental” trader is the economic calendar, whose strong sides are covered [in this review][2].

Practical application of FX economic calendar

The economic fx calendar is the list of upcoming events (calendar of events) grouped by countries, importance (the strongest impact on forex rates), and so on. An event, scheduled in the daily economic calendar, which  going on in a country directly influences its local currency and market conditions.

The most important events in the USA that affect the value of assets:

  • Fed’s decision on the federal funds rate changes (frequency: 1-3 times a year). It influences investors’ interest in the US currency. An interest rate hike results in the growth of the USD value relative to other currencies.
  • Nonfarm payrolls (monthly US jobs report). You can learn how this report affects foreign exchange rates and how to make money using nonfarm payrolls [here][3].               
  • Reports on crude oil production and the number of oil rigs (published monthly). They have a short-term effect on oil futures. If oil production declines, the demand usually increases. If the number of operating oil rigs contracts, the supply will reduce. In both cases, oil prices increase.

Other important events that influence Forex rates:

  • ECB’s monetary policy decisions. It determines the future policy concerning inflation, issuance of bonds, volumes of money supply, interest, and deposit rates.
  • Macroeconomic statistics. It covers the balance of payments, GDP rate and industrial production, inflation rate, price indexes, and other economic data. It affects the value of the local currency versus the US dollar.

The above examples are only a part of the cases that represent the relation of the forex rates to the wide range of economic events.

Example of a forex news trading strategy. Make money on the forex market when BoE Governor Carney speaks

Select the current date (for, example, 09.01.2020) in the [economic calendar][1] and enter the event importance (choose the high priority). On the given date, there are only two events of high priority: the governors of the BoE and the BoC speak. Select your time zone in the fx forex calendar (for example, for GMT+2, the speech starts at 11.30 local time).

![LiteForex: Forex economic calendar, how to trade with the forex calendar.][4]

Let’s try to make profits from the first event, the speech of the BoE governor Mark Carney. Open the GBP/USD trading chart and analyze the hourly chart in real time.

![LiteForex: Forex economic calendar, how to trade with the forex calendar.][5]

Over the past 10 days, the price chart has formed a Triangle pattern. This means that the price can break out the upper or the lower border of the pattern at any time. The BoE governor’s speech is likely to trigger the breakout (filter all the important news for the current week in the UK filter, and you will see that, apart from this speech, there no more news events particularly significant).

Set the M5 timeframe for the [GBP/USD][6] pair on MT4. And wait until 11.30. As a risk warning, I’d like to note that it carries a high level of risk to enter a trade during the first minute, as the majority’s opinion has not yet formed and the initial direction can be false. Hold the position open for about 30 minutes (the price can work out some most important events in a few hours), but, if the trend is exhausting (smaller candlestick bodies, candlestick in the opposite direction), exit the trade earlier.

![LiteForex: Forex economic calendar, how to trade with the forex calendar.][7]

Mark Carney has signaled that the Bank of England is willing to lower the interest rate from 0.75% to 0.5% if the weakness of the UK economy continues, gave a general market commentary. This has strengthened the pound against the US dollar allowing it to hit its two-week low. One could have earned about 40 points on this new over 30 minutes.

Note that you don’t have to listen to the speech of the Bank of England governor (although it is useful). It is enough to follow the trend, that is the opinion of the majority. However, there is a risk to enter a little late. So, I still recommend reading the news or listening to direct speech, to pick up the start of the new trend early and start trading.

A few tips to traders trading based on the fundamental analysis:

  • You should always compare the current data with the forecast. If the report is positive but worse than the forecast, the asset price will go down.
  • Be careful with the filters. If you choose only the USA in the filter, you can miss the data on the euro-area economy. And it can make a strong influence on the market.
  • You should fully understand the potential impact of the news. Bear in mind that if the event is expected and predictable, the price may not change when the event occurs, as it has been already priced. For example, a relatively predictable change in the Fed’s interest rate will have a little impact on the U.S. dollar rate at the moment of the decision.

Are you interested in trading an instrument? Open the [demo account][8], run the economic calendar, and learn to make money. If you are interested in the mobile version of the [economic calendar][1], I recommend following [this link][9]. If you have any questions, feel free to ask in the comments. Let study new forex instruments together! I wish you success in trading!

P.S. Did you like my article? Share it in social networks: it will be the best “thank you” :)

Ask me questions and comment below. I’ll be glad to answer your questions and give necessary explanations.

Useful links:

  • I recommend trying to trade with a reliable broker [here][10]. The system allows you to trade by yourself or copy successful traders from all across the globe.
  • Use my promo-code BLOG for getting deposit bonus 50% on LiteForex platform. Just enter this code in the appropriate field while [depositing][11] your trading account.
  • Telegram channel with high-quality analytics, Forex reviews, training articles, and other useful things for traders

![Forex economic calendar][12]

The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.

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  3. www.liteforex.com/blog/for-beginners/test-2019-01-24/
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  8. www.liteforex.com/trading/account-types/demo/
  9. www.liteforex.com/mobile-apps/ios/calendar/
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