5 Trading Tools You'll Actually Use

Trading can feel like trying to solve a puzzle with a million pieces, right? And half of them seem to be missing! I get it. I've been in the trenches for over eight years. But what if I told you there are tools out there that can make the picture a whole lot clearer?

Forget those run-of-the-mill indicators you see everywhere. I'm talking about real-world data that can give you an edge. These are the tools that seriously changed the game for me.

I want to share the top five trading tools that I use. They'll help you see what's really happening in the market.

Economic Aggregators: No More Surprise Attacks

Ever been in a trade, feeling good, and then BAM! The market goes wild? You're staring at the chart, confused. Your P&L is all over the place. Then, ten minutes later, you see a headline about some GDP data release. Turns out, it was forecasted! Rookie mistake, right? We've all been there.

Trading Economics is the answer. It's a free platform that gives you real-time access to economic releases. GDP, inflation, unemployment rates, it's all there.

How to Use Trading Economics

Head over to their website. Click on the calendar. You can filter by country, category, time zone, and expected impact.

Let's say you're trading GBP/USD. You see that Great Britain has the S&P Global Manufacturing PMI coming out. It's forecasted to have minor growth, but anything under 50 is still negative. You know there's expected volatility at that time. You also know we're still expecting a negative impact on the pound.

Things aren't priced in as they happen. They're priced in way before. The market places bets. You can expect to see some weakness ahead of this event all week leading into Friday.

Trading Economics even gives you a consensus figure. This comes from hedge fund managers. They also give you a forecast figure. This is from their internal analyst team. You can dive deep into economies with this data.

Putting It Into Practice

When you start your trading week, check the calendar. See what's coming out. What's the expected impact? This tells you how much volatility the event will cause. Select the pairs you're trading, or the nation. You can filter by region or look at just the majors.

Write down the key events. Get an understanding of the forecast. It'll give you so much more info than just looking at a price chart.

Trading Economics gives you an edge. It breaks down macroeconomic events in an easy-to-understand way. All the data you need is right there. You'll never be caught off guard again.

Treasury Inflation-Protected Securities (TIPS): Predicting the Future

Most people get inflation and interest rates. But TIPS? That's next level. TIPS can help you predict where inflation may go. If inflation is in the headlines, you're already too late.

TIPS are treasury inflation-protected securities. They're bonds. These bonds rise in price when inflation climbs. Their yields give insights into future inflation expectations. They're your inflation-predicting best friend!

Let's look at the spread between the 10-year TIPS and the 10-year Treasury bond yields. If the average is 2.3%, the market is pricing in 2.3% average inflation over the next 10 years.

When this spread starts widening, that's the signal! The market is expecting inflation to rise. This helps you predict how inflation will affect the market. FX, interest rates, commodities—it all matters. If you can predict inflation rising, you've got a good chance of getting ahead of the Fed.

Seeing the Spread on TradingView

Here's how to visualize this on TradingView.

1. Open the US10Y chart on TradingView.

2. Hit the "+" arrow. Click "compare symbol."

3. Write in "US10Y" Hit the "minus" sign.

4. Throw in "DFII10" as well. Click enter.

5. A new chart will show up on your screen.

6. Right click the new chart. Go to "pin to scale."

7. Click "pin to existing right scale."

8. Right click the scale and go back to "regular."

9. This will throw the chart back in.

10. Make the color pop to see the gap between the lines.

The purple line is the spread. If it's widening, inflation expectations are growing. Start looking at trades in gold. Look at currencies sensitive to inflation moves.

If the spread starts to drop, expect the Fed to ease. You can position yourself ahead of inflation data. Understanding how inflation is priced in the market helps you stay ahead. You'll understand what the Fed is thinking about interest rate hikes or cuts.

Interest Rate Futures: What the Market Really Thinks

Let's stay on the topic of interest rates. I showed you how inflation futures work. Now, I'll show you how to see where people are putting their money based on interest rates long into the future.

Enter the CME FedWatch Tool. This tool lets us see how futures markets are pricing expectations. They even give you a percentile.

See the CME FedWatch Tool.

Using the CME FedWatch Tool

With the CME FedWatch Tool, you can see the likely percentage based on market expectations. You can see the chance of easing interest rates. You can see the chance of no change. Or even a rate hike.

You can also see the changes in probabilities over time. One month ago, there was a 97% chance we'd be at our current rate. Now, there's still a 97% chance.

This is a great way to forecast what the Fed is doing. You can ensure you're on the right side of those central banks. Especially if you're a currency trader.

Seasonal Analysis: Trading with the Calendar

This next one is my favorite. It's seasonal analysis. Charts move in patterns. Assets move in patterns. These patterns repeat. That's what we trade.

It happens on a grand scale too. Seasonality came into focus around commodity trading. Farming has harvesting seasons, growing seasons, planting seasons. When most people are buying at harvest, demand increases. Supply increases too. Then, during the rain, there's no supply. Demand gets higher. Prices get higher. It's basic economics. And it applies to any asset.

Seasonax: Your Seasonal Edge

I want to introduce you to Seasonax. This tool lets you identify seasonal plays.

With Seasonax you can see years and years of patterns and data in one spot.

Let's look at soybeans.

Seasonax aggregates years of data into one chart. You can see the seasonal patterns that happen every year.

From the end of January to mid-June, soybeans gain strength in price. From mid-June to the beginning of October, they drop. Mid-October to late December, they climb again.

The Seasonax tool lets you drag between dates. You can see the data involved. You can see the win rate. How many years were profitable? How many years lost? Seasonax shows you.

Check out Seasonax.

Making It Work for You

Seasonal analysis lets you identify patterns. You can analyze the returns. It's like backtesting, but easy. You can find what makes sense.

Seasonal analysis is a big part of my trading. You can see whether you're in the prime time to trade an asset. Or whether you should stay away. If you're going against the seasonal trend, probability is not in your favor. Make sure your risk management is in check.

If you find a trade setup that lines up with seasonal analysis, you can give yourself an incredible edge.

Baltic Dry Index: The Shipping Thermometer

I want to give you some shipping information. It's another relevant topic, given the global shutdowns that happened. Let's dive into the Baltic Dry Index.

Shipping is very important in today's economy. People export and import. The price of moving those goods impacts whether nations can buy or sell. It impacts whether economies can profit.

It's important to understand shipping prices. If they're skyrocketing, exporting countries and importing businesses may struggle. Their performance may suffer. You can position better when trading companies or currencies.

Understanding the BDI

The ticker is BDI. Just type it into TradingView.

The Baltic Dry Index measures global shipping rates. Spikes in the index mean rising demand for shipping. This often means price increases for goods and commodities.

If you see this index rising, adjust your commodity trades. Look at oils and metals. It could signal supply chain bottlenecks. It could mean inflationary pressures.

Rising freight rates can also give you early insights into global demand.

The Baltic Dry Index is a great way to get an idea of what's happening. Compare it with your assets. You'll see the impact.

Go Forth and Trade Smarter!

There you have it. Five advanced trading tools to help you gain a better edge. Play around with them. Have some fun. Apply these to your trading. Don't just trade with an edge. Trade with the power of macroeconomics behind you.