Table of Content
Table of Content
The Best Forex Factory Beginners Guide Of 2023
Forex Factory has been dubbed by many as the ‘Forex Wikipedia’ because it’s the go-to place for real news events. It’s critical for those who trade Forex news and market announcements. The Forex Factory platform facilitates and aids traders with their forex trading.
The Forex calendar provided by Forex Factory is very easy to use for all types of traders. The calendar keeps the news-related info ready to help you out in advance. You can go through different tutorials just to understand how to get the best out of the calendar and how you can manage them to aid you with creating a fundamental bias on each currency you are looking to trade.
‘Fundamental Analysis’ Used With Forex Factory Data
Before you can go on and learn how you can grow your trading habits and start earning money from the forex market, you have to recognize the skill of Fundamental analysis is as important as technical analysis.
You have to be wise and also include market Fundamentals in your trading strategy. Fundamental Analysis is all about comparing and analysing one country’s economic data and performance with a second one (or a group of countries in case they share a common currency).
Forex Factory is a guide and is considered by many traders as the best Forex fundamental news website. Brokers such as EasyMarkets and City Index offer Live news indexes through their interactive broker platforms hence when you are trading live and place trades by reacting to the news.
A Step-by-Step Guide to Using the Forex Factory Calendar
As you can understand Forex Factory is an information-based platform. In the initial stages, someone new to the market can find it difficult to grasp certain terminologies and how certain news events impact a particular currency they are trying to analyse (see our Fundamental Analysis guide).
You may have heard many times that the forex market and currencies move by the power of technicals (i.e. price action, price level sentiment, support & resistance etc.); but in reality, it’s the fundamental news indicated or governed by a nation’s central bank or government that causes currency prices to either appreciate and depreciate.
When you’re trying to understand the Fundamental analysis of forex trading; start with Forex Factory. Information presented in Forex Factory is concise, accurate and designed so it can be used by all calibre of traders.
Almost every forex trader has a Forex Factory window open in their browser along with their forex broker trading platform (if you don’t have a broker see our guide to help you). Below are key features and a guide to using the Forex factory platform.
Step 1) Setup the Forex Factory News Calendar
The first step is to set up your calendar. To do so, you will have to register and log into the Forex Factory platform.
Once you are logged in, you will have to go to Calendar. This will show you numerous events! News events to be specific! It will be best if you focus your attention on these events. You will be able to find your clock time in the top right-hand corner of your screen.
Click on it, to fix the time zone. This is important as all the events shown on your calendar page will work according to your time zone (i.e. the country you live in).
To set a particular time zone, click on the time shown on the bar and you will have the screen to choose your time zone. Make sure you know your timings well and select the time zone accordingly. If you select the time zone wrong, you might miss valuable news.
You can also check for current news i.e. forex factory calendar today by simply clicking on the ‘Today’ button on the left navigation bar.
On the ‘calendar’ screen shown above you can switch between dates both historical and upcoming. A great feature is you can backdate fundamental events that happened as far as January 2007, approximately eleven years ago.
This is a unique feature, especially when you are analysing the impact of a certain news announcement it has on a particular currency, e.g. when FOMC Chair “Janet Yellen” makes a statement it impacts USD (dollar) denominated currencies.
Step 2) What does the Forex Factory News Events Mean?
Earlier traders used to keep track of the latest news & events related to trading by keeping an eye on the newspaper, television or other such sources. But things have changed a lot. These days, the trading platforms, themselves, offer traders regular updates related to various news and events and Forex Factory is not at all an exception.
It’s important to match the news event that is correlated with the currency you are about to analyse. For Example, FOMC updates and news will impact only USD dollar-denominated currencies such as Eurusd, Gbpusd & Usdjpy to name a few.
To make sure you do not have to go through a heap of unnecessary news and can find the right one very easily by using the filter. As shown above, you can read the related stories in order of the most current first. When you expand the folder icon, every news term has a definition which is indicated by the subheading ‘measures’.
Step 3) How To Use The Forex Factory Filters?
Since most of the news does not affect the market big time, you have to know how to filter them to ensure the right news is on your dashboard. To do so, you have to click on the ‘filter’ button. You can find it in the right-hand top corner. It will give you the option to choose the kind of currency and types of events you wish to be informed of.
You have to choose to view only those news events which may have a high impact on the market. Tick the red and orange boxes to receive only high and medium-impact news events. Once done, you can save the settings so that whenever you open your Forex Factory app, it will show you the same priorities.
- Red Flag – High Impact
- Orange – Medium Impact
- Yellow – Low impact
Red flag events have to be noted as they are High Impact and by high impact, we mean increased trading volume and volatility to be expected around the timing of these events. Normal guidelines are that you should be wary of volatility at least 20 minutes before the scheduling of the event.
Red Forex Factory News Examples- High Impact
Forex Factory lists red events based on their relevancy to the current economic calendar; here are a few events often classified as red:
Non-Farm Payrolls (NFP) in the U.S
Each month on the first Friday, the Bureau of Labor Statistics publishes its Non-Farm Payrolls report which provides data on job gains or losses in nonfarm nongovernment employment sectors (excluding agricultural employment).
This provides traders with insight into labour market strength, wage growth potential and potential implications for monetary policy decisions from the Federal Reserve.
Traders keenly anticipate this release that can provide them with valuable insight.
Interest Rate Decisions by Central Banks
Decisions regarding interest rates by major central banks like the Federal Reserve (Fed), European Central Bank (ECB), Bank of England (BoE) and Bank of Japan (BoJ), are widely regarded as red events.
Their decisions set prevailing interest rates in their respective economies and can have profound ramifications on currency values and financial markets.
Particularly if these decisions lead to changes or shifts in monetary policy stance, potentially prompting significant market changes upon announcement of change or shifts by these central banks.
As an example, The Interest Rate as of June 2023 is 4.5% set by The BOE Bank of England which has seen an increase of 4.4% from an all-time low of 0.1% in 2020.
Gross Domestic Product (GDP) Releases
GDP releases offer an accurate snapshot of economic activity within a country or region, showing the total value of goods and services produced during a specific period.
As these reports provide indicators of growth, GDP reports often form part of red events such as major economies such as the US, Eurozone, UK or Japan regularly publishing GDP numbers that influence currency values and market sentiment significantly.
Central Bank Press Conferences
Press conferences held by central bank officials such as the Federal Reserve Chair or European Central Bank President can be pivotal events.
At these press conferences, officials provide insights into their monetary policy decisions, economic outlook and potential rate shifts – as well as any comments made during these conferences that can have an enormous impact on currency markets and set expectations in markets around the world.
Orange Forex Factory News Examples- Medium Impact
Forex Factory defines an orange news event as any medium-impact event with moderate influence over the market, potentially creating some volatility while impacting currency prices and sentiment to some degree.
Although exactly which events fit this definition will vary based on the economic calendar, here are a few that frequently fall under this classification:
Consumer Price Index (CPI) Reports
CPI reports track changes in prices over time of an array of goods and services, providing insights into inflationary trends within an economy. As these reports can have medium-impact events on currency values and interest rate expectations, traders often closely follow CPI data releases to assess their effects on monetary policy decisions.
Reports on the Purchasing Managers’ Index (PMI)
PMI surveys provide an indication of business activity and sentiment in specific sectors or countries. PMI reports are released periodically for various sectors such as manufacturing, services and construction and serve as medium-impact events that reflect economic expansion or contraction; traders use PMI data to gauge economic health as well as anticipate possible market movements.
Speeches by Central Bank Officials
Public appearances by officials at central banks or monetary policymakers – such as heads of central banks or monetary policymakers – can often be classified as orange events, and can offer insights into future monetary policy decisions, economic outlook and potential interest rate shifts.
Although their effects vary, speeches typically have only moderate influences on market sentiment while potentially creating some volatility.
Retail Sales Reports
Retail sales report measures total retail establishment sales within a given period and offers insight into consumer spending habits and retail sector strength.
Retail sales releases tend to be medium-impact events; traders use retail sales data as an indicator of consumer trust levels and economic growth potential.
Yellow Forex Factory News Examples- Low Impact
Forex Factory defines yellow news events as low-impact events expected to have only minimal effects on the market, usually with a lower risk of creating significant volatility or directly impacting currency prices.
Although individual events listed can differ based on economic calendar events, here are a few that typically fall into this category:
Housing Market Indicators
Housing market indicators provide insights into the condition of the real estate market, such as housing starts, building permits or existing home sales.
While such indicators can have an indirect effect on economic growth, their immediate influence may be limited and should therefore not be classified as high-impact events.
Business Confidence Surveys
These surveys seek to gauge the sentiment and expectations of businesses within a particular sector or country, such as Germany’s IFO Business Climate Index or Japan’s Tankan Survey, giving insight into economic conditions despite potentially having only minimal effects on currency values directly.
Trade Balance Reports
These reports offer insight into the difference between exports and imports for any country, as well as any surplus or deficit within a particular period.
While such data can have long-term ramifications on currency values, typically these events have low-impact events until they significantly deviate from expectations in the market.
Step 4) What Forex Factory Events Are Essential? Give Examples of Currency Impact
So, you are all set to use the filters right? But which events do you choose to filter? Although you have the option to choose the high and medium-impact news events and they will be automatically on your dashboard; you have to understand which of those events will be important for you. Not all the events marked as important or impact news will be important for you, so it’s highly suggested to check well and then proceed to trade.
You can filter by events and it’s simplified into groups such as Growth, Employment, Housing, Inflation etc. Another top feature is you can look up news announcements for individuals or multiple even groups across multiple currencies. As stated before we have highlighted the below to have the most impact and which traders around the world pay the most attention to.
Whether you are scalping the market or swing trading (slightly longer term) you have to understand that bias can change with reports and news announcements regarding the below. The impact can have an adverse impact on your trading position.
- Central Bank Interest Rate Decisions: Monetary policy decisions by major central banks like the Federal Reserve (Fed), European Central Bank (ECB), Bank of England and Japan can have an immense effect on currency valuations.
- Non-Farm Payrolls (NFP) Report: The monthly release of U.S. non-farm payroll data can have significant market impacts and cause considerable market fluctuation. It provides information about new or lost jobs in the economy as well as unemployment rate data.
- Gross Domestic Product (GDP) Releases: GDP serves as an important barometer of economic health. Forex traders closely track GDP releases from key economies like the US, Eurozone, Japan and China as they can have significant effects on currency movements.
- Consumer Price Index (CPI) Reports: CPI measures inflation and is closely followed by traders. Inflation data may influence central bank decisions and currency valuations. Key CPI reports to keep an eye on include the U.S. Consumer Price Index and the Eurozone Harmonized Index of Consumer Prices (HICP).
- Central Bank Policy Statements and Press Conferences: When central banks announce changes to interest rates or quantitative easing programs, policy statements and press conferences provide valuable insight into future policy direction while potentially having a ripple effect on currency markets.
- Trade Balance Data: Trade balance reports provide data on a country’s imports and exports, outlining any surpluses or deficits in trade between imports and exports. Forex traders keep an eye on such reports because they may affect currency values significantly in countries heavily dependent upon international trade.
- Political and Geopolitical Events: Political events such as elections, referendums and geopolitical tensions can have an enormous effect on currency markets. Therefore, traders pay careful attention to any developments which could potentially influence exchange rates.
Using the Forex Factory Forum or known as ‘Forex Tips Forum’
The trading forum is an indispensable part of Forex Factory and as a beginner trader, you cannot ask for more. Unlike other forums, people here are helpful and are ready to help beginners with all the resources and materials that they need for their trading.
You have to understand one thing very clearly, to learn, you must read. There are plenty of valuable posts on the Forex Factory forum, specially written for beginners and going through them can certainly help you learn a lot.
How To Make The Most with Forex Factory Forum
1) Create an Account: Begin your Forex Factory experience by creating an account on their website and participating in discussions, posting comments and customizing forum settings.
2) Acquaint Yourself With the Forum Structure: Take some time to familiarise yourself with the structure of this forum, its sections and sub-forums. There are four primary sections: Trading Discussion, Trading Systems Discussion, Broker Discussion Journal Discussions and Commercial Content. The above screenshot shows the trading discussion page.
3) Read and Research: Prior to posting any thread or question on the forum, utilize the search bar to see if a similar subject or question has already been covered. This will enable you to locate pertinent information quickly while reducing duplicate efforts.
4) Contribute and Ask Questions: For guidance or specific inquiries, create a new thread in the appropriate subforum. Clearly state any pertinent details and provide any pertinent answers in your post. Interact with other members’ threads by posting thoughtful comments and insights that add depth and breadth.
5) Follow Forum Etiquette: When engaging in discussions on forums, always maintain an appropriate and professional tone when engaging with fellow forum members. Do not make personal attacks against anyone on the board; use proper grammar and spelling, as well as respect other people’s opinions. They won’t allow spamming and placing unnecessary website links.
6) Use Forex Factory’s Forum Tools: Our forum tools can enhance your forum experience. Subscribe to your thread of interest to be notified when new posts arrive; use the search function for specific topics; or take advantage of private messaging features to communicate directly with other members.
7) Filter and Customize Content: You can personalise the forum by setting your preferences in the User Control Panel, which allows you to filter threads based on specific criteria, set email notifications, and manage subscriptions.
8) Utilise Additional Resources: In addition to its forum, Forex Factory also offers additional resources like an economic calendar, news section, market analysis and trade explorer that may help supplement your trading decisions. Utilizing These Additional Resources
9) Discover from Experienced Traders: The Forex Factory forum features a large community of experienced traders who share their insights, strategies, and trading tips – taking advantage of this knowledge base can broaden your understanding of the forex market.
10) Stay Active and Engaged: Regularly participate in discussions, share experiences, and contribute to the community. Engaging with others allows you to learn and grow as a trader
Becoming a Forex Factory Member
Activate your account and join the vibrant trading community of Forex Factory! Here, you can share ideas with other traders as well as access any posts related to your interests.
Aside from connecting with fellow members in this forum, registering also comes with plenty of benefits such as being able to view new threads and updates regularly so that you’re always on the top-of-the game when it comes to staying informed about the latest news surrounding the forex industry:-
- You will be able to post freely your trading ideas
- Other members can subscribe and also become buddies
- You will be able to submit your own stories under the news section
- Create a new trade explorer
- Subscribe to certain stories, members, or threads that you think are important, thus making sure to get updates on them.
- Chat with other experienced members over private message
Since this is a forum, you might be worried about forum privacy. Well, they have strict privacy rules and you should have no issues with the rules that they have set:
- They won’t be selling your activity or information
- No one can buy the email id that you submit to them
- Data deleted from Trade Explorer will not be retained
- Data once deleted from private messenger won’t be retained
Which Forex Fundamental News Event To Watch Out For?
There are a few prefixed events that you should have your eye on and that are certainly going to have an impact on the market.
- FOMC-related news- This impacts the USD or dollar-denominated currencies
- GDP related news
- Central Bank announcements e.g. Interest Rates– Most common are Central bank announcements e.g. Bank of England (affects GBP), Federal Reserve (affects USD), European Central Bank (ECB affects Euro) & Reserve Bank of Australia (affects AUD)
- Unemployment rates- Non-Farm Payroll or NFP is the highest-impact news event regarding employment change in the United States. This occurs on the 1st Friday of every month.
Points to remember when using the Forex Factory Forum
- Since this is a trading forum, your posts should be related to trading and nothing else. This will make sure you and your fellow members will also get valuable information regarding trading.
- While you are here to trade and win money, some other people might be looking to do the same. Well, you have to understand that you can’t pose any ill mentality towards them or behave in the wrong way.
- Do not provoke anyone using their nationalism or race. It is essential to understand that you cannot abuse or pose an inappropriate comment just because your trading competitor is from a different race or maybe from another country.
- Do not spam the forum as it may cause disqualification. You mustn’t post duplicate content or keep bumping your post.
- Do not get involved in different schemes, MLM, or signal services.
If you are new to Forex trading we think the resources might be useful for you:
Forex Factory FAQ
1. What Is Forex Factory?
Forex Factory is an established online platform offering real-time market data, economic calendars, news updates and forums dedicated to forex traders. As of June 22 2023, they have updated their platform to reflect real-time news data releases i.e., you will no longer have to use the refresh button.
2. Is Forex Factory free to use?
Absolutely, Forex Factory is completely cost-free to access market data, economic calendars and other resources without incurring additional expenses.
3. Can I access the Forex Factory Calendar?
To gain access to the Forex Factory calendar, visit their website and navigate to their “Calendar” tab. Here you will find information regarding upcoming economic events and their possible effects on markets.
4. Can I customise the Forex Factory calendar according to my own needs and preferences?
Users can tailor the Forex Factory calendar according to their individual needs and preferences. These customization options include setting filters for specific events or time zones as well as selecting their level of impact focus.
5. Can the Forex Factory Calendar help me trade?
The Forex Factory calendar serves to inform traders about upcoming economic events that can influence currency prices. However, using the calendar and event to inform trading decisions is at your discretion.
6. Does Forex Factory provide trading signals or recommendations?
Unfortunately, it doesn’t. Forex Factory serves primarily as a platform to access market data, economic calendars and discussions among traders.
7. Can I participate in forums on Forex Factory?
Absolutely. Forex Factory provides an interactive forum section, where traders can engage in discussions, share knowledge and learn from each other’s experiences. Nevertheless, it’s wise to exercise caution and conduct adequate research before making any trading decisions.
8. Should I trust the information shared on Forex Factory forums?
A10: While Forex Factory forums offer traders an open forum to share information and insights, traders must exercise caution and consider multiple perspectives before acting upon any forum-based data. Trading Fundamentals do require a more in-depth knowledge of economics.
9. Can I set price alerts with Forex Factory?
No. Unfortunately, Forex Factory does not provide an inbuilt feature to set price alerts; however, external tools or platforms may enable you to do this based on your individual trading needs.
10. How can I stay informed with the latest news on Forex Factory?
Forex Factory provides a “News” section where you can view market updates. Alternatively, subscribe to their RSS feed or follow them on social media accounts for real-time notifications of breaking stories.
11. Can I download historical News data from Forex Factory?
There is no direct way that exists within Forex Factory to download historical market data directly. You can access normally the last 3-6 months of data.