HOW TO USE FOREX FACTORY CALENDAR

You can view the foreign exchange calendar through the link below:

CALENDAR

Forex Factory has established itself as a leading destination for Forex traders around the globe. The site’s economic calendar is a valuable resource, offering comprehensive data that benefits traders across the board. By leveraging the insights from Forex Factory’s economic calendar, you can gain a clearer understanding of how market news influences currency values, potentially leading to higher earnings in your trading account.

Given the scarcity of articles explaining the functionality of the Forex Factory economic news calendar, I have compiled this comprehensive guide to provide clarity. Here, I will illustrate the steps involved in understanding the Forex Factory economic calendar, the significance of each column, and the necessary configurations, such as selecting the appropriate time zone, events, and news filter.

Reimagined Explanation of the Economic Calendar in Forex Trading

What is an Economic Calendar in Forex?

The Forex economic calendar is a curated list of significant economic events and news releases scheduled for specific dates, impacting the global economy. This calendar encompasses vital data such as:

• Real estate market statistics
• Labor market reports
• Inflation metrics
• Interest rate decisions, among others

These economic events are announced for various countries at different times, and you can find an extensive list on the Forex Factory calendar:

How to Access the Forex Factory Economic Calendar?

Accessing the Forex Factory’s economic calendar is straightforward. Simply follow the link provided below to explore the calendar:

Forex Factory Calendar

Understanding the Forex Factory Economic Calendar

Let’s break down the calendar’s layout, which you can customize to align with your trading focus.

On the left side of the calendar interface, you’ll find a navigation bar that allows you to select dates and view historical economic data or to check the current week’s anticipated events. This feature is particularly useful for intraday traders or those whose strategies hinge on significant news releases.

The Forex Factory economic calendar consists of several columns:

1. Timing

This section displays the date, day of the week, and exact time of the news release. An “All Day” entry indicates a significant economic event, such as an OPEC meeting or a Fed chairman’s press conference, occurring on that day.

2. Currency

Here, you’ll find the currencies affected by the release of specific economic reports, such as the GBP in response to UK interest rate announcements.

3. Impact

This column indicates the expected influence of the news on the currency. It uses a color-coding system:

• Red: High impact
• Orange: Moderate impact
• Yellow: Low impact
• Gray: Bank holidays, typically with low trading volume

4. News Name

Lists the titles of upcoming news events.

5. Details

Clicking the yellow folder icon in this column opens a section with additional details about the event, including its meaning, potential currency impact, source, and historical forecast and actual data.

6. Actual News Value

Displays the actual data from the news release, such as the reported number of US jobless claims.

7. Forecast

Shows expert predictions prior to the news release. The comparison between actual and forecast values is crucial for traders, as deviations can signal market movement.

8. Previous News Values

Provides the data from the last event for comparison with current and forecasted values.

9. Graph

Clicking the graph icon presents a visual representation of the news values over time, offering insights into economic trends.

Customizing the Forex Factory Calendar Time Zone

The Forex Factory calendar can be tailored to your local time zone, ensuring you receive timely news updates. To set your time zone:

1. Hover over the top right corner of the calendar where the time is displayed.
2. Select your time zone from the drop-down menu.
3. Save your settings for future visits.

Utilizing the Calendar News Filter

To streamline the information you receive and focus on events relevant to your trading strategy, use the news filter:

1. Click the “Calendar” tab at the top of the page.
2. Use the “Filter” button on the right to select events with significant impact (orange and red).
3. Customize further by choosing specific currencies or economic events of interest.

Trading Forex with the Economic Calendar

Develop a weekly trading plan based on anticipated economic news. Being prepared for economic reports can provide a market advantage. Remember, both fundamental and technical analyses are key in Forex trading.

The US dollar, as the world’s reserve currency, significantly influences Forex. Categorize currency pairs into majors (containing the USD) and crosses (without the USD) to navigate volatility during critical economic events.

Key Economic Reports to Monitor:

1. Interest Rate Changes: Fed rate decisions and announcements are pivotal, causing market fluctuations.
2. Consumer Price Index (CPI) or Inflation: Monthly releases that can trigger high volatility if they deviate from target levels.
3. ECB Inflation Policy: The ECB’s struggle with inflation targets affects the euro and broader market sentiment.

Example of Trading Based on the Economic Calendar

In late 2013, a drop in eurozone inflation led to market speculation about an ECB rate cut, impacting the euro’s value. The subsequent ECB meeting and press conference further influenced trading decisions based on expectations and policy statements.

Conclusion

The Forex Factory economic calendar is an invaluable tool for anticipating market movements in Forex. While fundamental analysis in Forex is complex and requires intuition and market sentiment understanding, mastering it, along with the economic calendar, can lead to significant trading success. Remember, trading based on expectations is a fundamental principle in Forex, and the economic calendar is where those expectations are formed and realized.