News and analysis is very important when you're trying to find the best move for your trading pair, you might use charting or basic information about the currency pairs, but in most cases, you'd use a combination of the two. Having up to the minute news and analysis data can play an important role in successful trading. Late breaking news of social unrest in a country can drive the price of currency down, giving opportunity for a profit if you've moved in the right direction on your currency exchange.
Trading platforms that have streaming news and commentary can prove quite beneficial for users. It's not enough, however, to simply broadcast news that comes from the currency pairs you trade. A breakdown and analysis of the information by experts is important and often a critical part of the process. Without the analysis and breakdown of the information, you'd be sorting through endless amounts of often useless feed, taking time that you could be devoting to more profitable forms of research. That's why any news and analysis tool you use should have filters to isolate the information on your specific trading pairs and also pertinent information that affects currency price.
Fundamental and analysis data should be as up-to-the-minute as possible. While it may not be possible to get information instantaneously, particularly if you want expert analysis, getting broadcasts frequently throughout the hour, and subsequently throughout the day, is important. The more broadcasts you have every hour, the more updated the information will be, even when factoring the time necessary for analysis.
Your platform should also have news headlines from important financial services, such as the Dow Jones Newswires or Bloomberg. The headlines should be in real time, so they probably won't contain an analysis, but can alert you to watch further or take action if the information warrants. Again, it should be right on your trading platform so you can take action immediately when that's what it indicates.
Other important research information should also be at the tips of your fingers. For instance, you should have a calendar that highlights the dates of when the currency countries you track release key economic information. Often these dramatically affect the values of currency. If available, a historic look at the effect this information had on the currency values in the past can help you get a grasp on how the information can affect the future values. While allowing experts to report this to you can be helpful, using the information to make your own analysis can give you experience, which will allow you to act faster and increase your potential profit or limit any losses.
Combining the research and analysis information with charting creates a dynamic background to make knowledgeable trades. The previous example of charting the effect that the specific outcome of an economic report had on the currency previously and using it to forecast the future combines these two methods. The more you know, the more you'll be less apt to make costly mistakes. While no technique or amount of information will ever have you trading at 100 percent, particularly if you're an active trader, news and analysis combined with charting can put and keep you in the group that makes a profit 65 percent of the time and in forex trading, that's extremely good.
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