The term "economic calendar" refers to the scheduled releases of significant economic data that have the potential to affect the movement of individual assets or even entire markets. These releases may take the form of economic data such as the U.S Non Farm Payroll report or individual planned events such as FED meetings for example.
These releases are closely followed by traders and investors alike to plan actual trades and even develop portfolio holdings. Given the cyclic nature of the economic calendar releases, patterns can develop which traders can take advantage of.
For example, the U.S. NFP (Non Farm Payroll) report. This is published on the first Friday of every month and measures the month-on-month employment figures in the U.S. job markets, excluding, as the name implies, the agricultural sectors and certain governmental sectors.
As a rule of thumb, if the NFP for a particular month is higher than the preceding month, this is a good indication of a rising market. More people in work, more people paying taxes and more consumers purchasing products. A rising NFP generally points to a firming USD.
These patterns can have significant benefits for traders and investors alike and keeping track of upcoming economic events is an excellent way to gauge trends in the markets.