Forex traders know the importance of economic news releases and how that effects the exchange rate. A positive or negative news announcement in the US morning session can send the EUR/USD rate up or down extremely fast! One way to capture these large moves is to use ENTRY STOP ORDERS.

Entry stop orders are an excellent way to get into a trade long or short AUTOMATICALLY. Often if the market is moving extremely fast (due to an economic news release or geopolitical event) and you want to get into a trade, it
is extremely difficult to get the price you click (live market order) because the exchange rate is moving up or down so fast. It is like trying to jump on a train that is moving at full speed.

An entry stop buy or sell order places an order with the dealing desk of your Forex clearing house to execute your order when the exchange rate touches the level you set the order at. The CMS VT platform guarantees that these types of orders will be filled. » Read more: Euro Key Level Economic News Release Trading Strategy

The price movement descriptions in this article are in their simplest forms and do not take into consideration any other factor. During your Forex trading course you will learn that there are other factors to consider when predicting price movement but for the sake of explanation they are not included in this article.

The most important thing to remember with economic news is that only unexpected news moves the markets.

1 – GDP and GNP

Gross Domestic Product (GDP) is a measure of the total value that a country outputs i.e. a reading of all economic activity. The Gross National Product (GNP) is the same as the GDP but it also takes into account a country’s earnings from overseas. To simplify, the GNP measures all the money made by the country’s residents regardless of where in the world they make it. This means that:

· A currency value will increase with an increase in GDP / GNP

· A currency value will decrease with a decrease in GDP / GNP

GDP and GNP are easily calculated and the forecast happens ahead of the news report and so figures only move the markets when the report includes a large difference compared to expected results.

2 – Producer Price Index (PPI)

In your Forex trading course you will learn that these are the prices that producers charge to the retail sector. This is an important indicator as it directly relates to the retail prices charged to the consumer – you. The market is very sensitive to this and unexpected change in the PPI. This means that: » Read more: Economic News Announcements to Consider During Your Forex Trading Course