Economic and financial indicators are pieces of economic data published by various government agencies or the private sector. These statistics, which are made public on a regular schedule, helps the market observers monitor the pulse of the economy.

Therefore, they are religiously followed by almost all people in the financial markets. With so many people prepared to react to the same information, usually the economic indicators have tremendous potential to generate volume and to move market prices.

News of economic and political nature are important and should be taken into account when analyzing the sentiment about a currency or currency pair. Take the recent example of the political climate in Egypt. With uncertainty about the fall of the Government or the Head of State, there are naturally concerns over control of this country over the Suez Canal, a major oil shipping routes.

Negotiate with news gives us more opportunities to trade in the forex market. When news comes out, especially important news that everyone is watching, you can expect a larger movement. Your goal as a trader should be to get the right direction of movement, but the simple fact of knowing that the market will actually move gives you an opportunity that definitely worth a look.

Often the news from government agencies are actually manipulations to express view points or policies. In Forex, these reports are used as tools to affect the perception of investors. Governments and traders try to make it all the time.

The most common way of handling news is always observe periods of consolidation before an important report, and only operate the breakout. This can be done in both short term and intraday. For example, after a low in September, the market was holding its breath in anticipation of the October numbers, that would be made public in November. In the 17 hours prior to the disclosure, the EUR/USD was confined to only 30 pips volatility. For those who operate the news, it would have provided a great opportunity to put a breakout position, especially because the probability of a big move in the market was extremely high.

Buy the rumor, sell the news is a common phrase used in the forex market, because it often seems that when a news is released, the movement is not what the report might lead one to believe. For example, say that is expected to increase in the unemployment rate in the U.S. Imagine that last month the unemployment rate was 8.8% and the consensus for the next report is 9.0%. With a consensus of 9.0%, means that all the major market players are anticipating a slowdown in the U.S. economy, and as a result, a weaker dollar.

So, with that anticipation, great actors of the market will not wait until the report is released to really begin to act and take a stand. They go ahead and start to sell their dollars for other currencies to the actual number released. Now let's say that the real unemployment rate is released and as expected, it reported 9.0%. As a retail trader, you see that and think "Ok, this is bad news for the U.S., it's time to sell the dollar!"

As a Forex trader, to have a particular forex news service is key. In a high-level perspective is simple enough to get business calendar and details of the next event. What is still more difficult is to obtain access to similar services that are mainly the preservation of large commercial organizations.