Have you heard of a Forex audio squawk?
I’ll detail what you need to know here.
First, an audio squawk:
Is a premium news feed which is delivered via audio in real time.
Why do people want news in audio format?
Because it’s faster.
Before an analyst has time to type the headline, the news have been squawked, and traders have acted.
Audio feeds are faster, and lead to traders making profits before headline-only readers have a chance to act.
As you can imagine, an FX or Forex Audio Squawk is simply an audio news feed which focuses on currency markets.
Squawks developed as a way to make things faster and cheaper.
Many premium feeds are costly, and if you want to be wired to all of them, you would have to pay a hefty fee per trader.
But if you put one person (or team) in charge of these, and train them to cull those feeds for quality info, they can just yell those to the other traders.
Hence, they hear the news instantaneously, and the shop gets to do this at a lower cost overall.
Of course, this also means it’s much cheaper to you do it this way than by signing up to a ton of different sources.
Not to mention how impractical checking too many sources is.
Professional traders all use a form of Forex audio squawk. If you don’t, you’re screwed.
Just having the ability to jump in (or out) of a position when the markets are shocked with a surprise (imagine the initial Brexit vote…) boosts profits.
Even then, most quality squawk services offer a good amount of research on data, the markets, and Central Banks, just to name a few.
Such deeper, synthetized research allows traders to get up to speed quicker.
Isn’t it expensive?
If you think of Forex as a hobby, you may find the cost prohibitive.
Some of the best squawks accessible to retail FX traders sell for about 150 USD per month.
Many are off-put by such pricing, but in reality, the service pretty much pays for itself (with the extra opportunities).
Using a Forex audio squawk is doubly important if you’re day trading currencies.
I mean, if you’re going to sit down on our desk all day, you can’t justify NOT having access to what’s going on at a moment’s notice.
Otherwise, you’ll miss all the opportunities…
This one’s simple.
Once you’ve purchased the service, you’ll just have to activate the audio on it (it should be very intuitive, since that’s the major appeal of the service).
You stay in your desk analyzing the markets, looking for opportunities, and when the Forex audio squawk starts talking, you’ll listen.
There is no audio except for potentially market-moving news.
Thus, when you hear the analyst talking, you’ll naturally pay attention.
Such analysts have been trained to identify market-moving news and events.
Hence, they already do two things for you:
1. Scour news feeds, and relevant events as they happen.
2. Determine what’s more likely to cause a reaction.
Therefore, all you have to do (besides keeping the audio “ON”) is check your trading platform and place (or not) a trade.
Obviously, not every piece of data affect price the same way (or at all). Thus, this kind of service isn’t a “make money pressing a button” kind of thing.
You have to be able to discern quickly whether price will move big time with those news or not.
See you soon,
The Forex Economist
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