Answers to Everyday Questions : what are the key fundamentals to watch for when trading forex? what economic indicators do u use? pls explain?

what are the key fundamentals to watch for when trading forex? what economic indicators do u use? pls explain?

3 Responses to “what are the key fundamentals to watch for when trading forex? what economic indicators do u use? pls explain?”

1. Steve B said :
   May 29th, 2010 at 8:25 pm

   You are proposing to gamble in Forex trading and don’t even understand the fundamentals ??

   You REALLY need to do you homework, or you ARE going to loose your shirt ..
2. Paul U said :
   May 29th, 2010 at 8:44 pm

   Very intelligent question. I like to see when people take the iniative to learn a bit about the Forex market before throwing their money into the pot.

   Rather than take the time and space to explain it here allow me to direct you to the BEST free Forex information source, http:///www.babypips.com

   This si what I recommend to all my students as the best way to begin their learning process on the Forex marketplace.

   Best wishes for a profitable adventure.

   Paul Upp
3. a1apbc said :
   May 29th, 2010 at 8:47 pm

   I understand what you are asking. There are a wide variety of news events (known as fundamentals in the forex arena) but, from my experience, the greatest movers are the consumer price index, the producer price index, and the non-farm payrolls number. Other news events, like the weekly jobless claims number, retail sales, and any sort of housing data tend to move the market slightly most of the time. I have not found GDP to move the market as much as many think, but it CAN move the market, especially if the number is unexpected. Other movers include the ISM and ISM Services, Michigan Consumer Sentiment Index, Trade Balance, Philly Fed, Empire State Index, Retail Sales, PCE, Richmond Fed, and Durable Goods. News from any major company, like GM, may slightly affect the dollar as well. One of the biggest indicators of all is any information that will affect interest rates on either side of your currency pair-here in the US it is the Fed, but in Japan it would be the BOJ, BOE in England, etc. I have given you some of the monthly reports that will affect the dollar but for a currency pair you will have to examine equivalent fundamentals for BOTH currencies-so for the CAD/JPY it would be important to examine Canadian as well as Japanese fundamentals. Other major economies will also have an affect on any currency pair, due to the law of one price and the effects of arbitrage in the world markets.

   No one is going to give you correlations because they are going to be different for every currency and different every time. I am sure by doing a search you could find some historic correlations for the pairs you desire, but it always good to do your own research by watching the pair(s) that you choose and seeing the real minute by minute reaction, instead of just at certain times.

   Forex Factory provides a good calendar of when the events take place, for all the majors:
   http://www.forexfactory.com/calendar.php

   Have fun. I don’t know if youre new to trading but if so you should know its hard work-just like being a doctor, lawyer, or business owner. The biggest trick as an entrepreneur in any field, especially trading, is NOT to listen to anyone that says you can’t do it, nor to the ones who tell you its easy-dumb and dumber my friend. Get in your own zone, never risk more than 2% of your capital, never be afraid to take a loss, control your costs, and set yourself up to profit when a pattern repeats itself.