Using a Forex Currency Market Report for Fundamental AnalysisA Forex currency market report can give you the insight you need to forecast future price direction of a country's currency.It provides data pertaining to the "fundamental" aspects of a country's economy, which makes it your key tool in fundamental analysis. For the purpose of helping you learn fundamental analysis, I define a Forex currency market report as any economic report that has an influence on Forex currency prices. Fundamental analysis is basically the study and interpretation of data released in these reports... ...data which will help you reach a trading decision and take a position. The Best Forex Financial Calendar If you watch a business news channel such as CNBC with any regularity, you'll notice that economic reports are released all the time, usually in the morning. A few of these, such as the U.S. NonFarm Payroll Report, are key economic reports that can really shake things up in the Forex market, especially when the numbers aren't what everyone expected. Besides watching CNBC to see the actual results of an economic report as soon as it's released, you'll need a financial calendar to give you a heads-up of upcoming releases. The best calendar I've found on the Internet is provided on the Forex Factory website. Not only do they provide you a calendar of report release dates and times, they also provide a description of the report, the currency most affected by the report, and the relative importance of the report to the currency. They even provide a chart of past report results, so you can analyze trends. This brings me to an important point about interpreting Forex currency market reports... Don't View a Forex Currency Market Report By Its Lonesome Self. Fundamental analysis is essentially "big picture" analysis. You want to read and interpret several releases of the same report over time, to see trends in the data. Once you've identified a trend, you could enter a trade in the direction of the trend. Chances of a winning trade are higher when the position taken is in the same direction of the trend..."the trend is your friend", as they say. The timeframe for fundamental analysis is typically long-term, so you would most likely enter into a "position" trade, holding your position open for several weeks or even a few months. (Don't forget to set your stop-loss!) Besides recognizing the trend, it's also important to note that the numbers released from previous reports can be "revised". When new numbers are released for an economic report, it's best to view and interpret them in combination with previously released numbers... ...not only to compare the new numbers with the trend, but also to consider any previous revisions. For example, if the numbers on the current release is positive for the currency, but the last several reports have been negative (i.e., trend has been down), then the market reaction may be somewhat subdued. The reaction may be even further subdued if there was a negative revision to the previous report. Key Forex Currency Market Reports Although there are many economic reports that have varying degrees of influence on the Forex market, I list below the key economic reports that you should focus on. 
These reports have the most impact on the Forex market.The majority are U.S. based reports. That's because the United States is the biggest fish in the pond, in terms of national economic size. With the U.S. Dollar making up one half of all Major Currency Pairs, and with the "Majors" making up 80% of forex currency trading volume, it's no surprise that a key economic report in the U.S. is also a key Forex currency market report. As you'll see, these key economic reports provide a measurement of the same forces that drive the Forex market...economic growth, interest rates, and inflation, to name a few.
Some international economic indicators do not have a U.S.-based equivalent report. Yet, given a country's unique economy or situation, reports for these particular indicators are very important. You should pay close attention to these reports as well. Forecast For Tomorrow In addition to analyzing market reports to identify trends, I subscribe to a newsletter called Forecast For Tomorrow . As the name implies, this newsletter attempts to predict long-term future trends. I think the researchers behind this newsletter are using a crystal ball, because the accuracy of their forecasts is amazing! I was most impressed by their prediction of the stock market crash at the end of 2008, which they predicted several months before it happened. Of course, their forecasts are not guaranteed to happen, but they do have an excellent track record. As you can imagine, having access to such insight into future events presents many opportunities for profit. I continue to subscribe to this newsletter, using it as a guide for long-term fundamental trends that I could invest in. Build YOUR Best Forex Trading System
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