It’s not uncommon for a beginner trader to overdo it at the beginning, hurrying to respond to the slightest fluctuations and investing more time than is reasonably affordable. More often than not, it turns out to be a recipe for disaster. Such a hustle is the quickest way to deplete your trading resources and burn down emotionally to the point where you grow unresponsive even to the long-awaited major events.

While it’s true that good timing comes with experience, you can cut down on fuss by setting the right date for your forex deals. This article explains how to use an economic calendar forex-wise to your advantage. Stick around for answers to the following:

  • what’s an economic calendar;
  • how to use a calendar to set dates in forex trade;
  • why not all economic calendars are created equal;
  • how to pick one that will meet your needs.

Economic Calendar: How to Use It

Simply put, an economic calendar is a calendar that includes potentially impactful finance-related events. This refers to a really broad spectrum, from news releases to scheduled changes in interest rates, with lots in between.

The chief purpose of a dedicated software product reflecting all these is to keep you up-to-date. With a calendar tuned to match your needs, you don’t need to check multiple sources of information all the time and spend time consolidating what you have found out. It’s also a nice visual aid for planning your trading endeavors.

By referring to an economic calendar, you can set trades for your trading deals in a way that will ensure maximum activity when the market is the most volatile. Timing your closures around important economic events is a wise strategy that will improve your efficiency.

News Releases and the Market

Most of the events included in an average economic calendar fall into one of the following categories: forecasts and projections of events to take place in the future and, conversely, reports on past events. There’s a large number of regular reports as well as news releases that are bound to influence the market. Here are some examples:

  • Central banks’ decisions regarding interest rates. The reason everyone cares about those is that the higher rates are likely to strengthen the currency by attracting an increased cash flow.
  • Up-to-date data on the consumer price index, also known as the CPI. This reflects the level of inflation and has every chance of influencing the central bank’s policy.
  • Any changes in the import-to-export ratio that have the potential to influence cross-border cash flows.
  • Information on personal consumption expenditures. This is an important indicator of the state of the US and global economy, normally published once a month.
  • Data on a gross domestic product, which is indicative of the total amount of goods and services produced in the respective country.
  • Unemployment rates, an indicator widely believed to be significant since lower values suggest better prospects for growth and strengthening of the currency. The opposite applies as well.

These examples are far from making up a comprehensive list of all events and reports to be included in the economic calendar. Calendars vary from platform to platform as well as are based on their users’ needs. The following section explains how to make a choice you won’t regret.

Choosing the Perfect Calendar

An economic calendar might sound very straightforward, but in reality, no two calendars are created the same. Traders who aren’t very confident about their situational knowledge as well as those who value their time usually prefer options where some background information is available on each event. This enables you to draw the right conclusions when the date comes.

While a generic economic calendar is much better than none at all, it might be a good idea to customize yours based on your needs. Consider the regions you’d like to cover. For example, traders who feel like the oil industry has a great impact on their positions might want to watch the news from the world’s biggest oil production regions.

The use of an interface is another important aspect to factor in. Remember you’re most probably going to use your economic calendar on a frequent basis, so make sure you can easily read it. Opt for straightforward solutions offering more details on request, such as the FBS Economic Calendar.

Bottom Line: Start Small

A classical approach works with economic calendars as well: start with the most essential events and reports and build the scope as your understanding deepens. Enjoy the insights!