, we came across the Forex Factory Calendar. And after looking at it, we find it highly useful. Although we have our own Forex Calendar, the Forex Factory Calendar is a good alternative. Now you might ask why look at any Forex Calendar when we can rely on technical analysis? Well, in a way, its quite true that Technical Analysis is a powerful way to approach market trading but it will be complete when you mix it with Fundamentals. We are proud to introduce to you this powerful resource in Forex Factory Calendar.
This tutorial will provide you the knowledge about the functionalities of the calendar which you can use as an advantage to your trading in the future. Before we continue, I would like to give you an outline so we can avoid common misinterpretations.
Most technical traders are neglectful on news events which is obviously a big disadvantage because they adopt a pure technical approach to trading. Now that does not mean they cannot make money trading this way, but it would certainly make them better traders if they combine technical and fundamental. In the stock market, William adopts a fundamental first approach before jumping into technical analysis. You can check out hisapproach to the stock market here. When it comes to Forex, the fundamental approach is different because its news driven and hence we refer to theForex Calendarlike the Forex Factory Calendar.
Unlike Stocks, we analyze Financial reports of the company but when it comes to Forex, we cant possibly be analyzing GDPs of various countries. Its not possible because the data is not even complete. The biggest secret government has is how much money they have out there and how much money they are printing. So without this and many other crucial data, the analyze Fundamentals like the way we would analyze the Stock Market is going to be a complete waste of time. Instead we look at news event. Analyzing the news wont be needed but anticipating it would be highly beneficial. As for news that has a great impact on the market, this would greatly affect it inimically. In addition, this can lessen the quality and bring pending orders into a sudden mess because of some type of news that greatly affect an open position.
So lets get started on how to use Forex Factory Calendar
Navigating the Forex Factory calendar would be the first step.Click hereto go to the Forex Factory Calendar. Below is how the Forex Factory Calendar look.
How to Use the Forex Factory Calendar for Fundamental Analysis
We will be conducting a step by step tutorial. Everything will make sense at the end At the moment, just stay with us each step of the way.
Although this step is not crucial, we set the time zone because we certainly do not want to get confused with the timing of the news release.Click on the timeon the top right corner of the screen to go to the screen below.
Setting Your Time Zone for Your Forex Factory Calendar
Once clicked, you will now be redirected into the time zone settings. Here you can set your local time for each news event. Like mentioned earlier, you set to your local time so that theres no confusion about the time of the event. Getting this wrong may cost your portfolio some pain especially if you are using a low volatility strategy when the news event hits. So do set your local time up correctly.
Filter Events thats only important inside Forex Factory Calendar
Under Expected Impact there are colored boxes that have a brief description. In order to do this, just simply hover your pointer on each boxes and the following description will appear on your screen.
We highly suggest that you focus more on the news events with medium and high-impact. Having this said, your calendar will not be filled with news that has a low impact on the market but will provide you a perfect picture of what to anticipate in the future. Once you are all set, you may now click Apply Filter to show the results of the currencies and news events you have selected. Any alteration on the settings could be done anytime; all you need to do is repeat the steps. So for example, if we are focused only on EURUSD, then we will select the currency as EURUSD and our preference is only to have high impact news event to show. Setting like below
We focus only on High Impact News Event in Forex Factory Calendar and Block Out the Noise
We dont like clutters and like a simple screen that show us whats relevant only. So only the Forex pair that we trade and high impact news event will be of any interest to us.
Now that we have your your local time zone set and news event filter configured, we can now begin to select your preferred date
range for the events to show. On the left hand side of your screen, you could see the navigation panel which you can set any date range you prefer. We prefer to have the whole week in view so that we know what to expect. When we know that some events that may have high impact on volatility are in the week, we can plan to close out positions earlier. An example is our trade signal service,Profit By Friday, which strives on range bound markets whenBrexitwas near, we stopped trading earlier.
From the bottom half of the navigation pane, you could choose a pre-scheduled time frames quickly. Please also note that you can select an entire month (if you choose so) using the navigation panel. Like mentioned earlier, selecting the whole week would be the best method as you will have the time to plan way ahead.
Furthermore, expanding each event would allow you to see its surface content such as event name, scheduled time and expected impact. We need to be cautious in using this feature because it can be overwhelming and too easy to get sucked into reading too much for your own good. We should be more aware of high impact events but our main attention is on the chart where we should be looking at price of the Forex Pair we are trading.
Understand News Events Further in Forex Factory Calendar
Once you click on the folder icon, you will be brought to the screen below and heres where you can see everything in clear detail. Personally, we do not dwell too much into details. We just want to know how much increase in volatility by these events because, like mentioned earlier, one of our portfolios,Profit By Friday, works best on mid volatility and does not work too well in extreme price movements.
Seeing the Event in Detail in Forex Factory Calendar
By now, you have setup for Forex Factory Calendar and filtered out the noises and only see events that matters to you. We hope this quick tutorial is helpful to your trading. If you are a breakout strategy trader, focus on high impact news events only.
Profit By Friday is still open to accept new subscribers. We will trade for you and you dont even need to place any trade on your own. Joining Profit By Friday means that you are hiring us to trade for you.Click here to learn more on Profit By Friday.
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