Trading The Economic Reports

Read the story of Richard Samuels, a post office mailman with a head injury and how he made a fortune with these Neutrino Forex Signals. Download this Forex News Trading Report by henry Liu FREE. Get these Forex Scalping Cheatsheets FREE! Economic Reports are important for all markets but they are a way of life for the currency traders as well as the futures and options traders. Each individual market has its own set of reports which the traders pay special attention. But there are some economic reports that are prime catalysts for almost all markets especially the currency, bonds and the stock markets that stand at the center of the financial universe.

Gross Domestic Product, the Consumer and the Producer Price Index, the monthly Employment Reports, the FED’s Beige Book and the Institute for Supply Management (ISM) are some of the important economic reports that you should be aware of as a trader. You simply cannot ignore these reports. These economic reports are considered to be important trend setters in different markets.

As a trader, your world is highly dependent on the economic calendar. Economic calendar is the listing of dates when these important reports are released each month. Each month, these reports are released by different government agencies and the private sector. These reports are a major influence on how the financial markets move in general plus a source of cyclicality or the repetitiveness in the markets.

Not all reports are created equal. Some economic reports have more influence on the market than others. The most important reports that tend to move the markets a lot are the employment report, the Producer Price Index (PPI), the Consumer Price Index (CPI) and the FOMC Meeting Minutes.

The US Department of Labor’s NFP Employment Report is considered to be a major market moving report. It is released on the first Friday of each month at 8:30 AM EST. You should try to avoid trading at this time. However, there are many currency traders who now specialize in trading the NFP Report.

The release of employment figures is usually followed by frenzied trading that can last from a few minutes to the entire day depending on what the data shows and what the market was expecting.

The NFP Report becomes very important when the economy is shifting gears like the present when the US economy is coming out of recession. Market tends to develop an expectation about the employment figures and if the NFP report does not confirm with that expectation, it can make the market jittery for sometime before the importance of the release is digested by the market. Trader use the NFP report as one of the several important clues to predict the future of the interest rates.