Trading the news is a huge component of trading the financial markets. The News & Economic Data provides the markets with fresh momentum and clear direction & it gives the Central Banks the framework from which to manage their economies via interest rate adjustments. If the economic data comes in consistently strong the Central Bank raises interest rates and vice versa if the economic data is consistently weak, they will cut interest rates.
The higher a countries interest rates relative to others the higher the value of their currency will be. This also has a roll-on effect throughout the financial markets as they are all inter-related. The Forex market, Equity markets, Stock markets, & Commodity markets are all impacted by the news releases.
So, it’s massively important you understand and are aware of the upcoming releases and the potential impact they may have on various markets. Combining the news with technical analysis is where you will find all the best trades and that’s what the Bankers are constantly on the lookout for.
Understand this section and you’ll be well on the way to becoming a more consistent & successful trader.