Top 5 events to look out for when trading CFDs
May 13, 2020 (Investorideas.com Newswire) When trading CFDs, it is important to know that the market is being shaped up mainly by news events and releases. For traders, it is crucial to distinguish which events are important and will potentially give them an edge in the long run and which ones to skip. So, let's have a look at some of the most important events to look out for when trading CFD Online, and when these are taking place this month.
Each month, the world's Central Banks meet and decide on the interest rates that they are responsible for. An increase in rates usually leads to a currency's value rise. The opposite happens with a decrease in interest rates, which may result in a decrease in the currency value.
Let's now have a look at when the world's Central Banks are meeting in April 2020.
2. Gross Domestic Product (GDP)
Gross Domestic Product is an important indicator of a country's economic health. When GDP falls below a country's Central Bank expectations, its currency is expected to fall. On the other hand, when GDP exceeds expectations, the currency value tends to rise.
When are GDP announcements taking place in April?
3. Consumer Price Index (CPI)
The Consumer Price Index is one of the most widely used economic indicators to measure inflation. This index is measuring how much a basket of goods costs on average and highlights whether the same goods have become more expensive or not over a period of time. If an economy goes through inflation, interest rates will be rising to counteract the inflation effects.
How about taking a look at the CPI dates in April?
4. Employment Indicators
Countries' unemployment rates have always been crucial to both the markets and Central Banks, as an indicator of an economy's health. The higher the employment, the more the interest rates rise. Alongside the Unemployment rate, we also have the US ADP and NFP figures, released each month, with the NFP being one of the most widely used news releases for anyone who trades CFDs.
Let's have a look into their scheduled dates in April.
Although each country's Central Bank meeting is very important, the US Federal Open Market Committee takes centre stage, since the USD is currently the world's reserve currency. Each month, the FOMC meets to set interest rates and check if the current monetary policy works effectively. The FOMC Meeting helps traders speculate how Central Banks will behave in the future.
This month, the FOMC Minutes will be released on the 9th of April, whereas the Press Conference will take place on the 29th.
To conclude, all economic indicators and news releases showcase not only what each release means but how the market is expected to react. Traders may find it hard to follow the news, due to high potential volatility, but practice and education, along with your broker's support and trading tools on offer, always makes perfect.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.12% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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