Using Economic Indicators in Forex Trading

Economic indicators can help you get a sense for the general economic trend of a country. For example, an employment report that shows more jobs being created month after month, can show that an economy is becoming more productive. While a falling retail sales report can be a warning that growth is starting to contract.

Over the longer term, these trends can be the basis for a trade. You can invest in countries that are showing strength and trade against countries that are slowing down. This is the most basic element of fundamental analysis.