The leading indicators are economic factors that changes formerly the rest of economy begins to go in a specific direction. These indicators help policymakers and market observers to predict substantial change in the economy. Indicators are always accurate, however looking at leading economic indicators in union with other types of information can help provide possible information about future health of an economy.
Many traders and investors use leading indicators to forecast imminent change in market. Leading indicators change before market change, so traders considered them significant guideline to take wisely decision for investment. Leading indicators such as building permits, employment and unemployment records, nonfarm payroll, consumer confidence index and purchasing manager index have great impact on market. So traders watch these leading indicators closely to take best decision regarding market investment.