Fundamental data is the key to understanding why the forex market moves the way that it moves. Yes, technical analysis is just as important in trading but if you don't understand what news moves the market and what is happening in the current economic climate than you are trading blind and ignorant. Ignorance is not an excuse, if traders are ignorant the markets don't care. You will just lose your money and blow your account and then you become another forex statistic.
Fundamental data helps to bring profits to the trader because it gives them information as to how a currency may perform. The foreign currency exchange is a global market and because of the large size of the market there is a lot of news to digest and sort through. So this article is to help you to find what type of global news is important and moves the currency. There are many key economic indicators that the major players in the forex market such as governments, banks and institutional investors are watching. They use those indicators to guide them in how they are going to trade the currency.
One of the most important indicators that give clues as to the health of the economy is the unemployment report. That particular report is watched by many traders and when that information comes traders make decisions based on those numbers. If you want to learn to be a trader it pays off to learn what these numbers mean for an economy and how they impact each particular currency. The unemployment report is a leading indicator and if job losses are increasing that indicates that the economic health of the country is deteriorating and if job losses are decreasing that means that the economy is improving.
A good way to get reliable information about economic indicators is from your forex broker. Many brokers are helping traders by giving them reliable economic news and how to interpret the reports that are coming out. Most traders don't have the time or resources to dig through all the economic data on their own. The wise trader will take advantage of a good broker and the resources that their broker offers. It is also a good idea to find a broker that puts out a good reliable source of economic indicators.
Other important indicators to look at are: housing, unemployment, inflation, budget deficits, The Gross Domestic Product, retail sales reports, and consumer price index.
There are many indicators to look at but with time and practice you will understand what is impacting the market and the currencies. Using fundamental economic data along with technical analysis and a trading plan you can do well trading in the forex market.
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