I am finding it difficult to comprehend and utilize the information offered at the economic calendar event for my benefit.
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Since around 2019, the impact of news on currencies has dropped significantly. Post-COVID, a single economic figure does not carry much weight in the broader news context. Key factors now are central bank decisions, speeches, and changes in government fiscal policies.
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Understanding the investing calendar can be a game-changer for you. Here is a quick breakdown:
Every news item on the calendar has three data points: Previous, Forecast, and Actual. For instance, take the upcoming Non-Farm Payroll (NFP) report on April 2nd:
- Previous: This is the last reported figure (379k in this case). It’s not as crucial now since it’s already old news.
- Forecast: Analysts’ predictions of what they expect. This can be hit or miss.
- Actual: The real-time data when the report is released.
To use this to your advantage, compare the Forecast to the Actual numbers. Generally, if the Actual number exceeds the Forecast, the USD usually rises. If it falls short, the USD typically drops. Keep in mind, this isn’t guaranteed.
Focus on high-impact news (3-star or red news). Check out ForexFactory’s NEWS section to see how the market reacts to these events, and pay attention to both red and yellow news.