Forex Economic Calendar For 2021
As a serious forex trader, you know that a trading plan is an essential part of your strategy. One vital step in your trading plan has to be checking an economic calendar. Economic news releases affect the forex market to varying degrees, but they do have some effect. In some cases, the market becomes incredibly volatile, and you can be wiped out before you know what’s happening. You’ll also miss a great opportunity to make some significant profits based on that volatility.
Stay on top of your game and ensure you are employing the correct forex trading strategies at the right time. How? By using an economic calendar like the one we’re providing below. Our calendar was chosen by expert forex traders and will provide you with all the information you need regarding every event around the world.
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What Is an Economic Calendar?
An economic calendar is a schedule of data releases and news events that relate to the financial markets and the economy of the world in general. It includes information about interest rate decisions, GDP data, and Non-Farm Payroll numbers.
Economic data is released frequently, sometimes on a daily basis, so keeping track of it is essential. An economic calendar will list these events, along with the dates and times when the information is scheduled for release. On most economic calendars, events are graded based on how significant their impact will be. Events with a minimal impact on the market are marked as “Low”, those that are more important are marked “Medium”, and the most significant releases are marked as “High”. These ratings are often color-coded and sometimes accompanied by a symbol.
When participating in market trading, traders who use economic calendars are better able to understand why markets are moving in a particular direction. Therefore, they are better able to anticipate future moves. Although it is not always possible to correctly predict the market’s reaction to economic announcements, these data releases represent a strong trading opportunity. By using an economic calendar, an investor will know when to check the financial news in order to potentially capitalize on market trends.
Many forex economic calendars also offer other essential information, such as the previous figures of the upcoming release, the consensus, and, once the data has gone public, the actual figures.
Recommended Economic Events for 2021
Be Aware Of Market Volatility Due to High-Impact News Releases
Although being aware of all economic events is important for serious traders, the ones that are most vital are marked “High Impact”. These include economic events like ECB meetings, and FOMC meetings. Around the time of these data releases, there will always be strong volatility in the markets. This will lead to some traders canceling their orders, which could cause liquidity to drop, thereby triggering instability in asset prices before a final direction is decided.
In order to limit risk, you can check a forex economic calendar on a daily basis, before you start trading. This means that you will know if the market is likely to become volatile. You can then decide whether to avoid trading during this period or to attempt to increase your profits by taking advantage of market volatility. Usually, during normal market conditions, you can determine your risk exposure on every trade. However, in the event of a high-impact data release, it is possible for things to change drastically in moments. The market can reverse course unexpectedly and make significant price movements in seconds.
When you are aware that the market may be unpredictable, you can close any open positions a short time before the news release. You can also refrain from opening new trades until the data has been released, thereby limiting the high risk of loss.
How to Use a Forex Economic Calendar
An economic calendar show the date and the time when economic news will be released, but also what those releases will be. They also show which country is releasing the data, thereby indicating the currency that will be affected.
Great economic calendars, like the one we provided, also show other information to make trading far easier. For example, if you click on the event, a short explanation of what it is, why it’s important, and what the figures mean appears.
You can also see, at a glance, the rating of the release’s expected impact on the forex market, but also data such as the previous figure and the market forecast consensus. Once the data has been released, the actual figures are displayed.
There’s even a countdown timer so you know how much time you have left before the release is issued. This information allows you to plot a chart and to identify the possible bottoms and tops of a trend.
Online economic calendars generally incorporate numerous vital indicators which are regularly updated to help traders to make an informed trade. These include:
- CCI (Consumer Confidence Index) – a survey of US households showing spending power and financial health of average consumers in America
- Consumer Credit Report – a monthly report estimating the change in outstanding unsecured loans extended to individuals to buy consumer goods
- CPI (Consumer Price Index) – a US inflation benchmark that covers the prices of the most commonly purchased consumer services and goods
- Durable Goods Report – data about manufacturer orders of durable goods
- ECI (Employee Cost Index) – a report released quarterly reflecting changes in benefits, bonuses and wages
- Employment Situation Report – a survey of a sample of businesses and households representing vital statistics like hourly earnings, hours worked and unemployment rates
- Existing Home Sales – a report showing how many existing home sales were closed
- Factory Orders Report – a report combining the Durable Goods Report with data about sales of non-durable goods like clothes and food
- GDP – a report which represents the market value of services and goods produced by a country’s economy
- Housing Starts – the number of new homes being built
- Industrial Production – the monthly quantity of goods made by industrial businesses
- Jobless Claims Report – the number of initial jobless claims filed in the US
- Money Supply – An indicator showing how much money is available to spend in the economy
- Mutual Fund Flows – how much money is going out of or into mutual funds
- Non-Manufacturing Report – a report showing financial health in the service sector
- Personal Income and Outlays – data revealing insight into consumer behavior and economic consumption
- PPI (Producer Price Index) – an index of wholesale prices
- Productivity Report – a quarterly report that measures the output of businesses
- Purchasing Managers Index (PMI) – a report which acts as a sentiment indicator for the manufacturing economy
- Retail Sales Report – a report which tracks the dollar value of retail merchandise
- Trade Balance Report – reveals the dollar value of exports with imports subtracted to reveal the nominal trade deficit
Use an Economic Calendar to Choose Forex Trading Strategies
Ideally, you should check the forex economic calendar on a regular basis, so you know what to expect. You should also take into account all economic events, even if they don’t seem directly related to the currency pairs you’re trading. For example, you might be focused on the EUR/USD, so you only track indicators and news releases from the US and the EU. However, China issues a statement that they’ve cut interest rates. The yuan loses value, making Chinese exports far more attractive, and European exports more expensive.
The market could react poorly, predicting that European export numbers will decline, thereby leading to the economy slowing down. The negative sentiment for the euro can then lead to it losing value. Of course, it will correct, but the market is made up of humans who have knee-jerk reactions. These reactions can lead to significant peaks or troughs forming. They might last only a few seconds or minutes, but it could be enough to cause significant losses.
The problem is that events like this can occur while you are asleep. For this reason, it’s imperative that you keep track of all economic news, regardless of when it’s released. Remember, releases happen on a 24-hour cycle because they are issued in different time zones by different countries.
Naturally, not all news releases have a significant impact, which is why the economic calendar we provide is so useful because it tells you how significant the event in question is. Plus, when you know the date and time of a release, you can take steps to protect yourself.
If you decide to trade the news, though, knowing historic figures and predictions will help you decide which direction to trade in. Once the news has been released, the actual figures provided in the economic calendar will give you an idea of what to expect. This will allow you to choose the best forex trading strategies to make a profit.
For example, if actual US unemployment figures are better than the forecasts, the US dollar will strengthen, making it a good idea to go long on the dollar.
The key to improving your trading is to make sure you check the forex economic calendar regularly, so you are always up to date with what is happening in the economies of the world.
Choose from the Best Forex Brokers List to Start Earning a Profit
We’ve seen how Forex economic calendars are essential to developing and implementing a great trading plan. If you decide to trade the news, you really need some vital information like historic figures and predictions to inform your choice of strategy. Great economic calendars like ours provide all this vital information, along with the actual results once published.
So, now that you have a good economic calendar in hand, and understand how it works, you have the tools you need to improve your trading strategies.
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