Description: We take a look at the importance of forex news to traders in the currency market.
The goal of every forex trader is to figure out where the market is headed at any point in time. If you are able to do this on a consistent basis, you will find it very easy to make money from the markets. There are several ways that this can be achieved and one of these is through the use of forex news
There is a long-standing tussle between traders that only trade off their charts and those that trade only fundamental releases, but this is not the focus of this article. Any trader that doesn’t combine technical analysis with fundamental analysis will only have himself to blame for their failure.
Forex news brings about volatility
People have tried time and again to disprove this fact through the use of certain theories and ideas, but at the end of the day, it is very easy to see that forex news is the single most important driving force behind this market. Ever wondered why the trading day instantly picks up only after a release hits the market? Technical analysts will attest to the fact their biggest profits come around periods following news releases.
Of course, this is in no way an advice asking you to forget about technical analysis entirely. Technical analysis has been very helpful for many traders and will continue to be. However, the traders that have seen the most success in this market are those who have been able to find a way to bring in forex news into their chart based trading systems.
Thankfully, brokers have made it very easy for traders willing to incorporate this into their trading by offering in-built news feeds on most trading platforms. Even if your broker of choice doesn’t offer this by default, there are other websites and news trading tools online that will make it easy for you to get news releases as soon as they hit the wires.
Forex news is easy to analyse
This is another importance of news in forex. Many people find technical analysis and all the intricacies to be a little bit daunting, but forex news is a bit easier to grasp as long as the individual in question has been able to understand the very basics of trading in general.
When a news release hits the wires, it is very easy for the traders to know if the USD will rise or fall over the next few hours, or even weeks. On some news release sites, it is as simple as selling the USD when the news comes out as red and buy the USD when the release comes out as green. The green shows that the release is positive for the currency, while red shows it is negative for the currency.
Therefore, in conclusion forex news must not be ignored if you want to analyse the forex market appropriately for profitable trades. If you are able to combine your technical style of trading with forex news trading, you stand a better chance of long-term success.
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