Economic calendar

The economic calendar is one of the most important information resources for any trader … and due to the higher profit potential in the Forex market, it is arguably of highest significance in Forex trading.

In war, more than 90% of the time is spent waiting, and being hungry. Fortunately, in FX trading, things are not quite so bad … there are periods of heightened activity – and profit potential – throughout the day, interspersed with what might be likened to “lulls in the fighting”. The notion is misleading, because in today’s fast-paced trading environment the eerie calm might be interrupted by riveting excitement at any moment.

Normally, however, markets – especially by way of their opening and closing hours – provide a certain framework to trading activity. Juxtaposed on this repetitive weekly schedule (modified by varying bank holidays in specific markets) are unique events. These may be divided into 2 major categories: expected events, i.e. forecast news releases, speeches, press conferences, etc., and unexpected events. The latter type is far less frequent, but the associated spikes yield the highest profit/loss potential in Forex trading.

Events of both the forecast, and unforeseen categories, together with opening and closing of the markets, are the real juice in Forex trading: this is what gets charts moving, this is what triggers decisions by large numbers of traders at the same time. Intense concentration by skilled and knowledgeable traders can yield fantastic profits in a very short amount of time – if the trader has the competence to make good use of these opportunities! The key to this type of power trading strategy is to enter and exit a position at exactly the right time. Execution slippage proves to be most harmful in these “news trading” scenarios. Take care of the problem by operating your MT4 trading terminal from your own Forex VPS, located close to your broker’s server!

Bespoke, and developed trading strategies are more suitable for long-term positions, basically cancelling out these market jitters. As generally the case, most market noise averages out over time. This is where fundamental analysis, and technical analysis yields best results. This holds, as long as one such unforeseen market event did not completely turn the tables on the basics for decision-making employed when developing these very strategies.

As a basic rule: if you are trading your account live, make best use of short-term “power trading” opportunities, while risking only a small portion of your entire trading capital in each exposed position.

If you want to execute trades round-the-clock, while yourself offline, use a powerful trading signal, or a managed account, hemmed in and secured by an Expert Advisor which will exit the position before things get out of control. Your own dedicated Forex VPS is the best platform for implementation of these long-term profit-building strategies.

Posted in Financial Transactions in Forex Trading, Forex terminology.