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The definition of basic Forex strategy
The strategy of the foreign exchange market is primarily dependent on the use of technical analysis. Forex analysis could be technical or fundamental. Below is a brief overview of both forms of Forex analysis and how they are used on the currency market.
Forex fundamental analysis
If it is difficult to evaluate the company, it makes sense to try to assess the country as a whole. Fundamental analysis Forex analysis is usually very complex and, as a rule, it is used to predict long-term trends; however, some traders manage to trade short term solely on the news. In the Forex market there are many different fundamental indicators. This is such indicators as: non-farm payrolls, the index of purchasing managers, consumer price index, retail sales, durable goods. But these reports are not the only fundamental factors worthy of attention. There are also several meetings from which come the comments can influence the markets no less than any reports. These meetings usually convened to discuss interest rates, inflation and other issues affecting the currency. Even changes of the forms of expression during the discussion of certain questions (for example, the comments of the Chairman of the Federal reserve system on interest rates) can velikolepetikhinsky on the market. Just reading reports and studying reviews can help the fundamental trader to better understand long-term trends and short - to profit from extraordinary events.
Forex technical analysis
Forex technical analysis as well as technical analysis of the stock market, presents an analysis of price trends. The only and key difference between Forex technical analysis and technical analysis of the stock market is the time frame, because the Forex is open 24 hours a day. Some of the most frequently used forms of Forex technical analysis: Elliott waves, Fibonacci, parabolic system, pivot points. Many technical Forex traders combine technical studies to make more accurate predictions (for example, Elliott wave and Fibonacci levels). Others create trading systems that carry them for the entire analysis and give signals of buying or selling, traders just have to choose to follow the system or not.
The most successful traders constantly hone their strategy and over time bring them to perfection. Some traders concentrate on just one form of technical analysis, whereas others use a wide range of indicators. The majority of experts suggests to use a combination of fundamental and technical analysis - in this case, you can make long-term forecasts (Forex fundamental analysis) as well as to determine the point of entry and exit (Forex technical analysis). But ultimately, the trader needs to decide for themselves that better suits him or her) (often by trial and error).
|Category: Forex | Added by: (29.10.2017)