Posted by https://www.babypips.com on Aug 20th 2022
Why do forex traders listen to the news before trading each day?
You want to be able to answer, “Which news releases should I trade?”
Forex traders should familiarize themselves with the key event risks that heavily impact the major currencies.
Remember that we are trading the news because of its ability to increase volatility in the short term, so naturally, we would like to only trade news that has the best market-moving potential for the currency market.
The news that tends to drive price action and produce volatility usually involves:
- Changes in central bank policy (“monetary policy”)
- Shifts in government policy (“fiscal policy“)
- Unexpected results in economic data releases
- Random tweets from a certain world leader who likes to put his name on tall buildings
Being aware of upcoming key event risks can help avoid being on the wrong side of the market.
How to Find Events that Produce Volatility
The BabyPips.com Economic Calendar highlights the important events and economic data that are being released by the countries with the most popularly traded currencies.