The analysis of the Currency market can be categorized into two types:
1. Fundamental analysis takes into account economic, social and political agentsand how they impact the foreign exchange markets.
2. Technical analysis engages charts to find out trends and patterns in the alteration of prices.
Choosing one over the other is not obvious. A cursory erxamination of FX trading related forums and websites show traders being staunch advocates of either one of these styles. Those who like technical analysis dispute that graphs are the only approach that can predict way ahead of time the trends which is important to making a profit in trading.
On the other hand, the fundamental analysts will affirm that currency prices are moved by socio-economic factors, a fact that cannot be declined. Thus according to them, chart patterns are mere eventualities that have no real relevance on reality.
This nonetheless, is not a foregone conviction. While the vast impression on the forex market, of variations in the economic and politcal spheres, cannot be denied, patterns or trends could possibly be gathered from price movements specially in the wake of announcements or during periods with no consequential announcements.
One counsel for the technical analysis believers is that there is a probability that they will be caught unprepared should interest rates suddenly change. If the analyst does not read the news then there is a big chance that they will make a bad trading call. This can end up in a major problem.
In the end, it is an irrefutable fact that economic aspects are behind most, if not all of the chief price movements but it cannot be disbelieved that there are trends that can be predicted by technical analysis for the shorter periods. So identifying these trends while being aware and up to date on current events is the most definite way to envisage direction of future currency rates. Close prediction is of course how one makes a profit on the foreign exchange market.
FX market movements are quite like elastic that can stretch in one way or another and then fall back, although not always to its beginning position. The fundamentals are the factors that cause it to stretch. Technical analysis portends how far it will reach in each direction before reversing.
The resolution then is that a smart trader utilizes both methods. So to repeatedly make profits in the forex market you must understand when to use which tool and how much importance you will give to their relevant, predicted outcomes. - 23210
1. Fundamental analysis takes into account economic, social and political agentsand how they impact the foreign exchange markets.
2. Technical analysis engages charts to find out trends and patterns in the alteration of prices.
Choosing one over the other is not obvious. A cursory erxamination of FX trading related forums and websites show traders being staunch advocates of either one of these styles. Those who like technical analysis dispute that graphs are the only approach that can predict way ahead of time the trends which is important to making a profit in trading.
On the other hand, the fundamental analysts will affirm that currency prices are moved by socio-economic factors, a fact that cannot be declined. Thus according to them, chart patterns are mere eventualities that have no real relevance on reality.
This nonetheless, is not a foregone conviction. While the vast impression on the forex market, of variations in the economic and politcal spheres, cannot be denied, patterns or trends could possibly be gathered from price movements specially in the wake of announcements or during periods with no consequential announcements.
One counsel for the technical analysis believers is that there is a probability that they will be caught unprepared should interest rates suddenly change. If the analyst does not read the news then there is a big chance that they will make a bad trading call. This can end up in a major problem.
In the end, it is an irrefutable fact that economic aspects are behind most, if not all of the chief price movements but it cannot be disbelieved that there are trends that can be predicted by technical analysis for the shorter periods. So identifying these trends while being aware and up to date on current events is the most definite way to envisage direction of future currency rates. Close prediction is of course how one makes a profit on the foreign exchange market.
FX market movements are quite like elastic that can stretch in one way or another and then fall back, although not always to its beginning position. The fundamentals are the factors that cause it to stretch. Technical analysis portends how far it will reach in each direction before reversing.
The resolution then is that a smart trader utilizes both methods. So to repeatedly make profits in the forex market you must understand when to use which tool and how much importance you will give to their relevant, predicted outcomes. - 23210
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Forex trading requires knowledge to read forex quotes. Forex markets move quickly, get forex trading training to keep on top of it.
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