Forex Alert

A Forex Alert service is a useful means of finding the most profitable currency pair to trade for the day. A Forex trader may have all of the skills necessary for profitable technical trading but if he is in a currency pair that is trading sideways there will be little potential profit. The trader may have studied the fundamentals of each currency in a trading pair and may anticipate profitable price movement. However, that price movement may not be occurring today. If a trader is buying Yen with British Pounds and the US Federal Reserve Chairman makes a statement about raising interest rates a Forex Alert service will alert the trader and allow him to move into a major currency pair that includes the US dollar in order to have a shot at profits as the market reacts.

A Forex Alert will be based upon any of a number of things. It may be something from the news such as the breaking reports of the Japanese earthquake and tsunami. It may also be a follow-up report such as the recent statement by a leading Japanese banker about the fact that the Japanese economy may take more time than expected to recover from electric power shortages caused by nuclear power plant shutdowns. When Japanese investors started bringing home assets to pay for reconstruction the price of the Yen went up dramatically. A Forex Alert could be the first report of substantial upward price movement of the Yen coupled with a high USD JPY trading volume. It could also be a report from the news when the G 7 financial ministers announced that their nations would intervene in the markets to the degree necessary to stop the rise of the Yen.

Although a trader may use a Forex Alert to guide where he trades, the trader will still need to know, or learn, the fundamentals of the situation that caused the Forex Alert. He will then also need to apply his skill set in technical trading in order to profit from being in a now volatile trading pair. If, for example, the US non farm payroll report states than there are more jobs in the USA the trader will need to understand that, usually, this means a stronger US economy, and a boost to the US dollar. Then he will need to look at how the market is reacting to the news, consult ongoing technical analysis, and trade accordingly. It is wise to remember than when one currency is rising or falling in relation to another than someone wins and someone loses in every trade, at least in the short run. When the trade is made the market moves on. Simply being in a volatile market is not enough for profits. The trader will need a trading strategy which he has back tested against old, historic data. Then, when confronted with a new trading situation, he will have a plan. When he has traded in such a situation it is also wise to review results. It is typically through reviewing trading results, profitable or not, that traders improve their trading skills, and their profits.