Forex Factory is a leading resource for forex traders, providing essential information including an economic calendar that helps traders monitor news and events that can impact the forex market. Here is a comprehensive and easy-to-understand guide on how to read and use the Forex Factory calendar:
What is the Forex Calendar?
The forex calendar is a table displaying a list of international economic news events that may influence forex market movements. These news events can have significant or minor impacts depending on their content and relevance to the affected currencies. The forex calendar helps traders perform fundamental analysis to make better trading decisions.
Functions of the Forex Calendar
- Provides Key Information: The forex calendar offers information about economic events that could affect currency values. This includes monetary policy announcements, key economic data, and other market indicators.
- Trading Indicator: The calendar helps traders identify when significant economic news or events will be released, which can be used to plan trading strategies and manage risk.
- Trading Opportunities: By knowing the schedule of news releases and their potential impacts, traders can capitalize on price movements that may result from these events.
How to Set Your Time Zone on the Forex Factory Calendar
Access Time Settings:
- Visit Forex Factory.
- Click on the clock icon in the top right corner of the page to access the time settings.
Adjust Time:
- Set the Forex Factory calendar to your local time zone (e.g., Western, Central, or Eastern Indonesian Time).
- Ensure your device is connected to the internet to receive accurate time updates.
How to Read the Forex Factory Calendar
Time:
- Displays the release time of economic data adjusted to the broker's server time or the selected time zone. Pay attention to the flag representing the affected currency.
Currency:
- Shows the flag symbol of the country and the currency affected by the news. For example, USD for the US Dollar or EUR for the Euro.
Event:
- Provides information about important events that may influence the market, such as economic announcements and statistical data. The date and time of the event are also displayed.
Priority:
- Indicates the impact of the news on the market:
- One dot: Low impact
- Two dots: Medium impact
- Three dots: High impact
Forecast:
- Displays the expected number for economic data before release. This can influence market expectations.
Previous:
- Shows the results of the previous data. Used as a comparison to estimate upcoming results.
Actual:
- Displays the latest released data according to the time and date. Used to compare with forecast and previous numbers.
Volatility/Impact:
- Color code indicating the impact of the news:
- Yellow: Low impact news
- Red: High impact news
Things to Consider
Calendar Quality: Choose a reliable and accurate forex calendar. Besides Forex Factory, there are other calendars such as DailyFX, FXStreet, and more. The reliability and comfort of the calendar are key considerations.
Regular Updates: Make sure to check the calendar regularly for the latest information and adjust your trading strategies accordingly.
Combination of Analysis: Use the forex calendar in conjunction with technical and fundamental analysis for more informed trading decisions.
By understanding how to read and use the Forex Factory calendar, traders can enhance their ability to make better trading decisions and take advantage of opportunities in the forex market.
