If you want to be successful in forex trading, you should be able to understand the market and analyze it on your own. This means reading books about forex trading and devouring every piece of information about it in newspapers, television and the internet.
In this industry, information is gold. A single piece of information can make or break your career as a forex trader and can give you great gains or really large losses. But in addition to books, which only provide an overview of the industry, economic news reports give the daily pieces of information that you may need to make decisions whether to buy or sell.
What is great about this news report is the fact that they cover not only one currency but all kinds of currencies around the world. That way you will be able to expand your reach not only to just one or two currencies but to all of them.
There are plenty of news reports in the media today and sometimes, they are so many that you do not really know what you should look into and read. Few however know that forex traders need only to look into just five major reports in order to make decisions on what to buy and what to sell. Here are two of them.
1. Unemployment payroll reports
The rate of conversion of a currency also depends on how progressive the economy is of that country. And one indication of a strong economy is the rate of unemployment in that country. A low unemployment rate means that the economy there is good and trade is better. With a high unemployment rate, a country is considered having a hard time coping with development and industrialization.
This affects the currency in such a way that it the conversion rates appreciate or depreciate depending on the reports news. For instance, if the unemployment rate is lower than what is expected, the currency appreciates because of the great news while if is higher than expected, you can be sure that it will go down a notch.
2. Interest rates
Another indicator of currency fluctuations is the country's interest rates. A higher interest rate for instance will cause the currency to trade stronger against its currency counterparts. This is because higher interest rates will cause foreign investors and traders to keep their money. The interest rate is actually one of the greatest indicators of currency appreciations and depreciations in forex trading.
