Every Forex trader recognizes the value of information, and a successful trader will first look for information on a currency pair before making any trades on it. However, it’s tricky; not because it’s hard to find information, but rather because there’s just so much of it that it’s difficult to tell the good from the bad.
Take Forex training courses, for example, a quick Google search will turn up millions of hits. That’s the problem, too much information, which is why instead of just listing the sources of information for Forex trading, I’m also going to show you how to identify the most appropriate sources of information.
You’re probably here right now because you want me to tell you which are the best trades to make, right? Unfortunately, I can’t do that, but before you hit the back button out of this page, I should say that I’ve got something much more valuable than just one profitable trade. I figure that I could give you my take on how the US dollar is going to perform this week, but there’s a chance I might be wrong, and you’re going to blame me for any incurred losses.
That right there is going to be the first lesson, we all get it wrong sometimes, and even the best traders in the world make some losses. Anyone who promises to provide 100% accurate information is frankly just running a Forex scam and should be avoided like a plague. Which is why we’re going to look at the various available sources to avoid such scams.
Did I mention that I’ve got something more valuable? Yes, more important than just one or two profitable trades is a lesson on sifting through the rubble of information from the dark corners of the web and identifying consistently great tips. All you will need is to identify what to look for and how to analyze the information. So, here’s what you should be looking out for:
The Forex calendar
This is the first tool every trader needs to get acquainted with, because it lets you know what’s going on around the world, and more importantly, what might happen in the coming days. Contrary to what you might be thinking, the Forex calendar is not meant just for fundamental analysts, but a useful tool for every trader regardless of their trading strategy.
We have our very own economic calendar Forex that’s always updated to keep you informed about the most recent news releases as well as the upcoming ones. I mentioned it first because it is perhaps every trader’s holy grail, letting you know what to expect in the future, and with our analysts’ comments, you also get predictions on how these announcements will affect the markets. Granted, we’re not always right, just like I said above, but it’s a good base to start from.
While going through this calendar, watch out for those announcements marked with a high importance rating, most likely coming from the world’s major economies like the US, UK EU, Japan and China. These countries’ economic policies created by their central banks’ reports have the ability to shift markets in a major way.
The Forex market is already decentralized, which means that you should not wait for information from only one source. What’s more, being a global venture involving thousands of traders, it doesn’t matter from where in the world the information is coming from, which is why there are so many trainers holding live webinars. A webinar, as you can tell from the name, is just an online seminar where people ‘gather’ to discuss ideas.
Almost all the best Forex broker will have some sort of webinar which is free to their clients, and this is almost always useful because Forex brokers hire excellent analysts since they have a lot of money. However, if your broker does not offer such a service, no problem, there are plenty more out there, you will just have to go through hours of garbage spewed by wannabe gurus. Don’t worry, we’ll look at how to weed out the good ones from the bad later.
I personally like webinars, especially those held by hosts trading in the live markets, but they are hard to find. Most webinars will be held by an individual talking about their past profitable trades, which just isn’t informative at all. The whole idea of a webinar is to learn from experience, which means understanding the whole process from the study of real-time Forex charts to the placing of the trade. In this way, you get to experience second-hand the thrill of a profitable trade and the sorrow of a losing trade.
This is what you should always aim for in a webinar, a live trading session and not a pre-recorded one. It’s also best to find one with active members brainstorming ideas and even contradicting the host as this teaches you to analyse the markets from different perspectives.
Groups and forums
These are the most popular information source because they are mostly free and have plenty of members. Joining such programs can be confusing at first, but you can quickly gain some footing just by checking in regularly. Over time, you will start to identify the really good traders from the pretenders, and you can follow their trades and even mirror them. This is where you will get regular updates about current market trends, reviews to help you when choosing a Forex broker, and other critical pieces of information.
Such discussions have also spilled over to social networks like Facebook and Twitter where you can join groups where traders discuss ideas. They are a lot like webinars, except these are text-based, you won’t need a webcam for these.
For a newbie still not very conversant with the markets, you might find webinars and forums confusing because members will be speaking in lingo you may not be familiar with. You might, for example, run into terms like cable, loonie, hawkish, dovish, long/short, etc. There are lots more that even I don’t always get, but the point is, if you can’t keep up with the conversations and arguments, don’t waste your time.
Training programs will basically be one way, with the host speaking and you listening, just like a classroom. Of course, you will still be able to ask questions, but all the ideas will be flowing from the host. These are a great resource for acquiring basic knowledge and tips on the best trades to place, how to choose a Forex broker? – all the basics, but you will be putting your trust in the host.
Acting on the information
Getting the information is only the first step of the process, you have to know how to make use of this knowledge for it to be actionable. This means putting into practice whatever you have learned into your trading. Since there are so many sources of information, it’s possible to get contradicting opinions on the same piece of information. It’s completely normal as everyone interprets data in their own way, so you have to be really careful what to agree with.
Check for the source’s reliability
This is pretty straightforward, just find out how credible the source is. For facts provided by, say, the Forex calendar, the information is always accurate, but it’s the personal opinions offered through webinars and trainers you have to be careful about. Some of these individuals may actually be profitable, but most of them are just failed traders looking for an alternative source of income. Just think about it, with all the time it takes to do research on the markets to establish the best entry and exit points, market sentiment, etc., when would such a trader be available 24/7 for training – unless they don’t actually trade.
The only way to tell if such a trainer is reliable is by checking for reviews left by previous visitors. All good training programs will allow visitors to leave comments, and if there aren’t any, be very suspicious. It’s also worth noting the platform they are using, and I’m not talking about the Forex trading platforms here. It’s the presentation – is it a website, skype video, TeamViewer; all these platforms represent different characteristics and level of dedication by the trader, and it should tell you about how much they prefer to remain anonymous and away from blame.
Test it yourself
The only way to prove is a trading strategy works is to actually put it in practice yourself, first using a demo account or other experimental types of trading accounts. No strategy will have a 100% success rate, and anything above 50% would be okay – the higher the better. Test and retest these acquired lessons for at least a month to prove that they actually work before betting with your real money. Remember, Forex trading has a lot to do with patience, and you should never rush into any trades simply because the first two or three were profitable.
Below is an example of a good source of Forex trading information in the form of an online training program: