A calendar of economic news should be in the toolbox of every forex trader. There are three main drivers of price action. Geopolitical news, economic news and technical driven trading signals. Regardless of how a trading strategy is build by a trader, all of those aspects needs to be taken into consideration in order to fully understand why a currency pair moved the way it did. Understanding price movements will help traders increase their profits and better their overall trading outcome. Some aspects can be analyzed, others can be planned for...
As you gradually gain confidence in your forex trading, the need and they want to experiment is quite natural. One of the first ports of experimental trade is the exotic currency transactions. Sometimes the need to do something different and unique pushes the forex trader towards these exotic and unusual currency pairs because they look more promising at the beginning. But, before we proceed any further, it is extremely important to understand the basics of these exotic pairs and the associated risks. Because the exotic forex pairs are more...
The US Dollar is the world’s reserve currency and while that is unlikely to change over the next decade, forex traders should be prepared for an outflow of assets. Global central banks are due to shift $500 billion worth of reserve assets from the US Dollar into the Euro. This is only a small percentage from the global reserve pool which is estimated at $11.3 trillion. As central banks decide to shift assets out of the US Dollar, ripple effects will be felt around the forex market and traders can capitalize from this event if they are properly...
Price action trading is a methodology of financial market speculation which consists of the analysis of basic price movement across time. Everything that affects the market and makes it move, from news and economic reports to big players like hedge funds and banks, is reflected via the raw price action on a price chart. There are many ways in which traders can take advantage of price action. Different forms of technical analysis — such as indicators, support, channels, etc. — can be used as a way of identifying changing price...
One of the first tasks new forex traders need to master is to understand forex quotes as this is the way currency pairs are priced and displayed to traders. It gives vital information about any given pair and key from anything related to technical analysis to fundamental analysis. Key aspects to understand are base and quote currency, bid and ask price and direct as well as indirect quote. Spread, pips and cross currency round up the vital pieces of information forex traders will receive from a forex quote. In the forex market currency...
