Profit from Economic News

This page on Economic News will cover:

- An Overview of this Type of News
- Why News moves futures markets
- The trading opportunities this news creates
- the most important reports and announcements to watch

Economic News Overview

But they may not be used as often as other futures trading tools or more popular indicators, probably due to being less understood by and known to traders.

So, what exactly are "Economic News Reports"?

They are a narrowly focused part of news, geared to reporting on various measures or indicators of our countries economic state or health.

The major news reports - - - those which tend to move futures market prices and create trading opportunities - - - cover Employment, Payroll, Unemployment, Housing Starts,Consumer Price Index, GDP, and several other key economic areas.

There are dozens more of these economic news reports that come out - many on a monthly basis...but they usually don't have the potential to move market prices in the same way the major reports do.

Economic News Releases
...Why They Move the Markets

Futures prices can go up, go down or remain relatively unmoved, depending on the news released.

In general, "good" news...increased consumer spending, higher housing starts, increased payroll and work week length, etc., paining a positive to strong economic picture of health...may tend to cause certain commodity futures prices to rise some, even jump quite a bit.

Conversely, "poor" news...higher unemployment, reduced spending or consumer confidence, slowing retail sales or manufacturing output, etc...painting a gloomier economic health picture...may tend to cause certain commodity futures prices to go lower, sometimes substantially.

Or, the markets may not respond much at all to the news, futures prices remaining relatively unchanged on an economic news release.

Other fundamental factors or news - -

(interest rate rise/cut announcement, unexpected oil price news, severe weather, etc.)

- - - occurring at the same time economic news comes out, may also affect the how these news releases move or don't move the markets.

Sometimes when this economic news "combo" happens, it may inject a higher level of volatility into the impact of the overall news, leading to wider price swings, and potentially more profitable news trading opportunities.

In general, there is no cut and dry formula for which economic news or releases may or may not move futures market prices. Sometimes the news moves the markets, sometimes it doesn't.

Sometimes the price action occurring can be quite large, while at other times little to no movement is seen.

But, if you know WHEN the news is coming out, you'll have half the answer.

Economic News Reports
...Timing is Everything

It pays to be aware of the major news releases and dates (see report info below), because if you're ready when the news does hit the street, and there IS a trading opportunity that fits your plan and strategy...you'll be poised to take advantage of it.

What's one of the major difficulties of trading? Timing!
When a futures market will make an anticipated price move.

Various trading indicators (RSI, MACD, Bollinger Bands, etc.) can give you some idea of a pending price move. But that's about all.

But no futures trader knows WHEN a move will take place.

With one possible exception.

Economic news reports come out on an EXACT date and time schedule when they are released to the public.

GOOD NEWS!

Since you know when the CPI, Industrial Production or Retail Sales economic reports will come out, doesn't it make sense to plan to around at these exact times...and to be ready to take advantage of potential trade opportunities the news may present?

This is another "tool" to put into your futures trading arsenal that can help you trade better...and at the least....in a more informed fashion.

Want another reason to use this tool? How about because many other traders don't? It can help give you an extra trading 'edge'.

And what trader wouldn't want a little more 'edge' or help when trading futures?

If you are considering trading the financial's (bonds, currencies, etc.) or the FOREX, be advised that the importance of several of these economic reports and the news they contain tends to be even more critical and important.

Economy has to do with money, and these "money markets" are more sensitive to, and more easily moved by the data key economic news like interest rate changes and Federal Reserve announcements...sometimes in very major ways.

You DEFINITELY don't want to be holding an open trading position(s) in the financial markets, and be asleep at the wheel when these major economic reports come out.

As a large move occurring on big news (causing a price move against your position) can potentially make for a very short trading career.

Bottom line - economic news and their respective economic reports can be another source of futures trading opportunities and profit for you...IF you take the time to learn about them, and potentially trading their news.

But, there are no guarantees what will happen, which is why it pays to be aware of and prepared for this economic news, because the news they contain is time sensitive...and the potential trade opportunities they may present are short-lived.

So, let's learn a bit more about some of the major economic reports.

Economic News
...The Major Market Movers

NON-FARM PAYROLL
(aka: The Employment Report)
Release Time / Date - 8:30 AM EST on 1ST Friday of each month (data for prior month)

ISM INDEX
Institute for Supply Management Monthly Report on Business
(formerly NAPM, Natl Assn of Purchasing Managers) Institute for Supply Management
Release Time / Date - 10:00 AM EST on 1ST business day of each month (data for prior month)

RETAIL SALES
Release Time / Date - 8:30 AM EST ~ 13th of each month (data for prior month)

CPI - CONSUMER PRICE INDEX
Release Time / Date - 8:30 AM EST ~ 13th of each month (data for prior month)

GROSS DOMESTIC PRODUCT
Release Time / Date - 8:30 AM EST ~3rd or 4th week of each month (data for prior quarter)

DURABLE ORDERS
Release Time / Date - 8:30 AM EST ~26th of each month (data for prior month)

INDUSTRIAL PRODUCTION
Release Time / Date - 9:15AM EST ~15th of each month (data for prior month)

PPI - PRODUCER PRICE INDEX
Release Time / Date - 8:30AM EST ~11th of each month (data for prior month)

HOUSING STARTS / BUILDING PERMITS
Release Time / Date - 8:30AM EST ~16th of each month (data for prior month)

CONSUMER CONFIDENCE
(Consumer Board Consumer Confidence)Release Time / Date - 8:30AM EST, on the last Tuesday of each month (data for current month)

While certainly not inclusive, the above reports and the economic news they present, are among the most important worth watching and potentially trading.

Also, any and all announcements from the Federal Reserve can also move all the markets - particularly financial futures and the FOREX - and should be circled on your trading calendar for potential trading opportunities they may present.



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