07.07.10
Now offering a comprehensive 4 month online training program for highly motivated people
 more
details
24.04.09
Now offering automatic execution of third-party signal and system providers.
more
details
|
|
| What moves the FX market? |
| |
| Foreign Exchange is affected by various economic and political factors. The
largest fluctuations in currency prices usually occur during Central Bank
intervention, when governments trade in huge amounts forex in an attempt to
either raise or lower the value of their own currency. This, aswell as many other
factors such as interest rate changes, economic figures, political instability
and large lot transactions by hedge funds can move the market. |
| |
| HOW CAN YOU PREDICT THE FUTURE FX MOVES? |
| |
| There are two major ways to analyze financial markets: fundamental analysis
and technical analysis. Fundamental analysis is based upon underlying
economic conditions, while technical analysis uses historical prices to predict
future movements. There is an ongoing debate as to which methodology is
more successful. Short-term traders prefer to use technical analysis, focusing
their strategies primarily on price action, while fundamental traders focus their
efforts on determining a currency's proper valuation, as well as future valuation.
It is important to take into consideration both strategies, as fundamental
analysis can explain technical analysis movements such as breakouts or
trend reversals. Technical analysis can explain fundamental analysis,
especially in quiet markets, causing resistance in trends or unexplainable
movements. |
| |
| FUNDAMENTAL ANALYSIS |
| |
| Fundamental analysis comprises the examination of macroeconomic
indicators, asset markets and political considerations when evaluating a
nation’s currency in terms of another. Macroeconomic indicators include
figures such as growth rates; as measured by Gross Domestic Product,
interest rates, inflation, unemployment, money supply, foreign exchange
reserves and productivity. Asset markets comprise stocks, bonds and real
estate. Political considerations impact the level of confidence in a nation’s
government, the climate of stability and level of certainty.(more information) |
| |
| Technical Analysis |
| |
| Technical analysis examines past price and volume data to forecast future
price movements. This type of analysis focuses on the formation of charts and
formulae to capture major and minor trends, identify buying/selling
opportunities assessing the extent of market turnarounds. Depending upon
your time horizon, you could use technical analysis on an intraday basis (5-
minute, 15 minute, hourly), weekly or monthly basis.(more information) |
| |
| |
|
|
|
