This tutorial highlights some of the Forex economic indicators that will be able to guide the trader’s path in understanding financial and economic data.
Some indicators are very important for certain markets, e.g. Non-farm payroll releases in the US, and others may not be as important.
Financial Data that Affects Currencies
Economic indicators are signals that provide guidance to the underlying data. This information is critical for traders to make buy and sell decisions. Financial economic indicators also describe the condition of the country’s economy and its impact on currencies.
The primary reason most Forex traders fail is that they ignore the process. In today’s world of quick-fix solutions, drive-thru menus, and expedient transportation, we want everything NOW. In our “convenient culture” we have come to expect results right away, putting aside the basic principles of cause and effect.
When you ask for Forex Trading success, do not expect a “coming right up!” response. Forex Trading is not a get-rich-quick method. If you approach it as one, you will almost inevitably get-poor-quick. Forex Trading involves work, it requires a process. Let us view The Process of Forex Trading together.
Even if there are many important things you will learn from a forex school, there are still many essential skills that you may not get from your forex education. This is not to denigrate the value of formal education in currency trading, but rather to stress the limits of this training.
When you are actually trading with real money, there are many practical skills that you will need in order to avoid losing all your trading capital. Of course, there may be opportunities for you to learn some of these skills if the school offers mentorship programs or supervised trading opportunities. Here is a short overview of some of these skills.
If you are new to forex trading, taking things slowly and gradually will help you not only survive, but will also increase your chances of long term success.
Taking this slowly applies to the time and money spent in trading and also your education as a trader. Here are four tips for taking it easy.
1.Taking your time with education: Sure, you’re a fast learner and you also have some background. Nevertheless, as with anything new, your mind needs time to absorb what you’ve learnt. Part of your education is done while not actively studying. Things need to settle down. It doesn’t happen automatically.
Trading currency in the foreign exchange market (forex) is fairly easy today with three types of accounts designed for retail investors: standard lot, mini lots and micro lots. Beginners can get started with a micro account for as little as $50.
Before you start jumping in you should familiarize themselves with the market and terminology of the forex market, and if you’ve already been trading stocks online it should be easy to get started.
Below is a list of terms you should learn.
PIP: The smallest price change that a given exchange rate can make. Since most major currency pairs are priced to four decimal places, the smallest change is that of the last decimal point. A common exception is for Japanese yen (JPY) pairs which are quoted to the second decimal point.
BASE CURRENCY: The first currency quoted in a currency pair on forex. It is also typically considered the domestic currency or accounting currency.