This includes analysing its growth rate potential, as well as any potential legal, political or insolvency risks. Our Morningstar equity research reports are updated regularly with new information about company fundamentals. These are available for a wide range of shares on our platform and can also indicate whether they are considered to be overvalued, fairly valued or undervalued within the stock market.

This information may help traders to make a decision on whether to enter a position or not. Register for a live account now to access our Morningstar reports. In general, news that has a significant impact on individual company shares may not have a major impact on currencies. Stock market news that has little or no impact on currencies includes earnings reports, management changes, mergers and acquisitions and partnerships.

Therefore, it may be easier for some to make more reliable forex news trading predictions on how the market will perform. Some brokers offer automated news trading signals that can help a trader to make decisions on whether to enter, exit or avoid a trade.

These hints are based on price fluctuations after a certain type of news release and can prompt traders to either buy or sell an asset. A manual alternative is to monitor upcoming tradeable events using our economic calendar. This feature can be found on our Next Generation platform and highlights events such as unemployment reports, GDP, CPI and PPI figures, as well as trade reports and sentiment surveys.

These events can all have an effect on market sentiment and cause major price swings within the financial markets. Our market calendar can be customised by date, market impact low to high and country, so you can filter these to be more relevant for the asset or market that you are interested in trading. You can also set alerts for individual events that you wish to monitor.

Certain major economic announcements can bring additional volatility in the markets, even if it is for just a short period of time. Even the neatest forex or stock chart patterns can temporarily be thrown out of sync by a significant trading announcement, such as the latest unemployment news or changes to interest rates or inflation from a nationwide bank.

Paying attention to when trading announcements are due can mean that you end up placing a carefully planned trade just before a major event happens, which instantly triggers your stop-loss. It may be more opportune to wait to open new positions after news events have taken place, and then see if the reason for the trade is still valid.

There is normally a consensus amongst leading economists about what level an economic announcement is likely to come in at. For example, low unemployment suggests a strong economy, so many would expect the stock market to rise. From time to time, however, economic announcements are very different from what the broader market was expecting, and this can cause an opposite market reaction. For example, if a central bank hints that rate cuts may be coming, but the currency still rises, there could be other factors in addition to the prospect of interest rate changes.

This could, in turn, prove to be a strong 'buy' signal. Many traders try to identify trends in the hope of profit. Such trends could range across minutes, days or even months. But most trends reverse at some point, and a change in the underlying economics could be the first sign of this.

Every journey starts with a single step and this is true of trend reversals as well. An economic announcement is rarely enough to quickly change a medium-term trend, but how the market reacts to surprises can give the first clue that sentiment is starting to shift.

This offers traders an opportunity to open positions at the very start of a new trend. Seamlessly open and close trades, track your progress and set up alerts. Of course, there are drawbacks of news-based trading as well. In particular, news trading requires expert fundamental analysis skills, as you will need to understand how certain economic announcements can affect your positions and the wider financial market.

There is also the risk of carrying positions for a longer period of time. If the news release requires a few days or weeks to materialise, your trading positions may be open over several days. This brings overnight risk and may require you to pay additional holding costs. Therefore, traders should ensure that they have sufficient funds in their account to cover these costs.

Open an account with CMC Markets to access our multitude of news and analysis tools. It is wise to keep up to date with the ever-changing financial markets. As discussed, our online trading platform , Next Generation, releases regular news and analysis articles for all financial markets. We also provide fundamental analysis reports from Morningstar, as well as market commentaries and updates from Reuters news on our news and insights section of the platform.

By following our news, this ensures that you are always up-to-date with the latest trends and changes within the financial markets, as well as general economic announcements.

Complete with all the regular charting features, these mobile applications make it easy to trade and monitor news announcements on-the-go. You can also set up trading alerts for both desktop and mobile and choose to receive push notifications via the app, email or SMS.

Reading more about our trading alerts. See why serious traders choose CMC. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. Personal Institutional Group Pro. Prior to starting FNG, Gerald founded Forex industry B2B news website LeapRate.

com in , selling it in to publicly traded Catena Media plc STO:CTM. An avid skier, cyclist and ice hockey player, Gerald was previously an investment banker for more than a decade at Bear Stearns, Robertson Stephens, and Merrill Lynch. Gerald holds an MBA from Columbia University in New York and a BCOM degree from the University of Toronto.

Leave a Reply Cancel reply Your email address will not be published. We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. Cookie settings ACCEPT. Manage consent. Close Privacy Overview This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website.

We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience. Necessary Necessary. The downside to the news trading approach however has to deal with spreads. In most cases, when trading with a broker that offers variable spreads in an ECN or STP environment, the spreads tend to widen quite a bit compared to normal trading conditions.

A trader therefore has to find the right broker that offers variable spreads, allows news trading while ensuring the spreads are not too wide during key news events.

Trading the News. The news events offer a great opportunity to trade the markets in the short term, preferably during intra day. Some of the key news events to trade , in order of importance include:. Besides the above, other markets moving events include speeches from Central banker and black swan events such as geo-political events as well as environmental catastrophes.

The best way to get started with news based trading is first look to the economic calendar. See ProfitF Economic Calendar There are many websites that offer free to use economic calendars, that can be filtered based on the currency and its importance.

The chart above shows a filtered economic calendar for the US Dollar. Here we see the all important monthly labor market data, NFP being released at hours. This presents a good tradable opportunity in pairs such as USDJPY, EURUSD, GBPUSD, USDCAD. When the headline reading is above the estimates depending on the type of release a better than or worse than expected reading results in price being bullish or bearish.

Taking the above example, when we look to the H1 chart of USDCAD , we can see how the news resulted in a 32 pip drop during the 1 hour. Why was it? Price in USDCAD fell, because the actual release was lesser than the estimated level including the unemployment rate, which was at 6.

However, the above event should not be looked into isolation but from a larger perspective. If we zoom back into the chart, we can notice, that previous to the uptrend, price was in a consolidation pattern for a long time. If we look on the H4 charts, we will notice the following.

Many short-term traders base their decisions solely on technical analysis and price charts, regardless of which markets they are trading. It's common for traders to completely ignore fundamental factors and instead follow price trends, analyse support and resistance levels and weigh up various signals from technical indicators. News releases such as earnings reports and changes to interest rates and inflation can significantly impact the markets.

Trading on news releases can, therefore, prove vastly beneficial to traders and can significantly strengthen their trading strategy by adding economic announcements to their purely technical and charting approach. Learn how to trade the news and spot potential trading opportunities within the financial markets. These can include changes to interest rates, inflation, unemployment levels or retail income for a specific country and these all have a significant effect on the financial markets and overall state of the economy.

Economic announcements often involve these particular factors when advising traders of recent changes within the markets. A news trading strategy involves trading based on market expectations, both before and after a news release. Trading on news announcements can require you to make quick decisions, as the financial markets may be impacted almost immediately. Therefore, you will need to make quick judgements on how to trade the announcement. When trading on news releases, it is important that you are aware of how financial markets work.

Sometimes news is already factored into the assets price. This happens because traders attempt to predict the results of future news announcements and so, in turn, the market responds by changing the price of an asset. News-based trading is especially useful for volatile markets, for example oil trading. Read more about using fundamental analysis in the consideration of external factors as part of your news trading strategy.

As with other asset classes, forex trading news can become particularly active before and following major economic events. However, there are significant differences between the type of news that sets apart currencies from other financial markets. Forex markets tend to respond the most to macroeconomic news — the kind of developments that reflect or impact broad economies.

News that suggests a more hawkish aggressive central bank tends to push forex pairs up in value relative to other currencies, while dovish peaceful news can cause a currency to depreciate. Currencies of countries that are major exporters of raw materials or commodities can be impacted by news forex trading news, as this affects the prices of the main commodities that they produce.

These currencies are often referred to as resource currencies. Prices of commodities that affect these currencies can be influenced by issues affecting supply and demand. On the supply side, news that suggests a lower supply can push up prices, while news that suggests higher supply can depress prices, which can then impact related currencies. News that could reflect changes in supply may cover political tensions, wars, terrorism, weather, economic sanctions, labour relations strikes and more.

Speculation and pricing related to demand is mainly influenced by many of the same major news releases noted above, plus commodity inventory reports and outlooks. In order to come up with a comprehensive forex trading strategy using news releases, forex traders tend to look out for certain key forex indicators that can have an impact on interest-rate speculation, including:. News related to market sentiment can also influence currency trading, particularly those considered to be safe havens, including the commodity gold, as well as major currencies USD, JPY and CHF.

These currencies tend to attract capital during times of turmoil and see outflows when the financial markets settle down. News that can impact risk-on, risk-off trading includes stock market returns and volatility, financial stresses at the national or continental level, political turmoil, elections, treaty negotiations and other broad news beyond economic data and central banks. Recent examples include the Greek debt crisis and China market turmoil.

Traders should be aware that demand for many commodities — and therefore the commodity's price — rises and falls with the seasons. Seasonal forex trading news and impacts tend to be seen in energy and agricultural commodities, but less so for precious metals. The table below shows some of the main resource currencies and the commodities that affect them. These can be used by traders as a sort of forex news trading signal, as it can help to predict where the price of the currency is headed.

Stock trading based on news releases is a strategy used by many long-term investors, as well as short-term traders. If a company has strong balance sheets, cash flows and earnings reports consistently, then a trader may decide to buy and hold the share for a longer period of time.

However, if a company releases a report with considerably lower financials than expected, this can cause a rally for traders to short the stock as its value is decreasing. Traders can perform company analysis before deciding whether to invest in a stock. This includes analysing its growth rate potential, as well as any potential legal, political or insolvency risks.

Our Morningstar equity research reports are updated regularly with new information about company fundamentals. These are available for a wide range of shares on our platform and can also indicate whether they are considered to be overvalued, fairly valued or undervalued within the stock market.

This information may help traders to make a decision on whether to enter a position or not. Register for a live account now to access our Morningstar reports. In general, news that has a significant impact on individual company shares may not have a major impact on currencies. Stock market news that has little or no impact on currencies includes earnings reports, management changes, mergers and acquisitions and partnerships. Therefore, it may be easier for some to make more reliable forex news trading predictions on how the market will perform.

Some brokers offer automated news trading signals that can help a trader to make decisions on whether to enter, exit or avoid a trade. These hints are based on price fluctuations after a certain type of news release and can prompt traders to either buy or sell an asset. A manual alternative is to monitor upcoming tradeable events using our economic calendar.

This feature can be found on our Next Generation platform and highlights events such as unemployment reports, GDP, CPI and PPI figures, as well as trade reports and sentiment surveys.

These events can all have an effect on market sentiment and cause major price swings within the financial markets. Our market calendar can be customised by date, market impact low to high and country, so you can filter these to be more relevant for the asset or market that you are interested in trading.

You can also set alerts for individual events that you wish to monitor. Certain major economic announcements can bring additional volatility in the markets, even if it is for just a short period of time.

Even the neatest forex or stock chart patterns can temporarily be thrown out of sync by a significant trading announcement, such as the latest unemployment news or changes to interest rates or inflation from a nationwide bank.

Paying attention to when trading announcements are due can mean that you end up placing a carefully planned trade just before a major event happens, which instantly triggers your stop-loss.

It may be more opportune to wait to open new positions after news events have taken place, and then see if the reason for the trade is still valid. There is normally a consensus amongst leading economists about what level an economic announcement is likely to come in at. For example, low unemployment suggests a strong economy, so many would expect the stock market to rise. From time to time, however, economic announcements are very different from what the broader market was expecting, and this can cause an opposite market reaction.

For example, if a central bank hints that rate cuts may be coming, but the currency still rises, there could be other factors in addition to the prospect of interest rate changes. This could, in turn, prove to be a strong 'buy' signal. Many traders try to identify trends in the hope of profit. Such trends could range across minutes, days or even months. But most trends reverse at some point, and a change in the underlying economics could be the first sign of this. Every journey starts with a single step and this is true of trend reversals as well.

An economic announcement is rarely enough to quickly change a medium-term trend, but how the market reacts to surprises can give the first clue that sentiment is starting to shift.

This offers traders an opportunity to open positions at the very start of a new trend. Seamlessly open and close trades, track your progress and set up alerts. Of course, there are drawbacks of news-based trading as well. In particular, news trading requires expert fundamental analysis skills, as you will need to understand how certain economic announcements can affect your positions and the wider financial market. There is also the risk of carrying positions for a longer period of time.

If the news release requires a few days or weeks to materialise, your trading positions may be open over several days. This brings overnight risk and may require you to pay additional holding costs. Therefore, traders should ensure that they have sufficient funds in their account to cover these costs.

Open an account with CMC Markets to access our multitude of news and analysis tools. It is wise to keep up to date with the ever-changing financial markets. As discussed, our online trading platform , Next Generation, releases regular news and analysis articles for all financial markets.

We also provide fundamental analysis reports from Morningstar, as well as market commentaries and updates from Reuters news on our news and insights section of the platform. By following our news, this ensures that you are always up-to-date with the latest trends and changes within the financial markets, as well as general economic announcements. Complete with all the regular charting features, these mobile applications make it easy to trade and monitor news announcements on-the-go.

You can also set up trading alerts for both desktop and mobile and choose to receive push notifications via the app, email or SMS. Reading more about our trading alerts. See why serious traders choose CMC. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. Personal Institutional Group Pro. Australia English 简体中文. Canada English 简体中文. New Zealand English 简体中文. Singapore English 简体中文. United Kingdom.

International English 简体中文. Start trading. Products Ways you can trade CFDs Spread betting What you can trade Forex Indices Cryptocurrencies Commodities Shares Share baskets Treasuries ETF trading Product details CFD spreads CFD margins CFD costs CFD rebates.

Latest news Highlights Featured chart Our market analysts Michael Hewson Jochen Stanzl Kelvin Wong. Learn to trade CFDs What are CFDs? Advantages of trading CFDs Risks of CFD trading CFD trading examples CFD holding costs Learn cryptocurrencies What is bitcoin? What is ethereum?

Latest news Highlights Featured chart Our market analysts Michael Hewson Jochen Stanzl Kelvin Wong. WisdomTree Securities gets approval to become FINRA broker-dealer member. But most trends reverse at some point, and a change in the underlying economics could be the first sign of this. News that can impact risk-on, risk-off trading includes stock market returns and volatility, financial stresses at the national or continental level, political turmoil, elections, treaty negotiations and other broad news beyond economic data and central banks. If we zoom back into the chart, we can notice, that previous to the uptrend, price was in a consolidation pattern for a long time. News Based Trading — Final points to bear in mind Trading news based events can be profitable if using the right approach.

Categories:

• Forex Brokers
• Binary Options
• Forex Bitcoin
• Binary Options online
• Forex