Please the honourable house, How may I be profitable using the fundamental analysis? I need help to be able to identify, read, interpret and apply it profitably to forex trading
Fundamental analysis alone is more for ‘longer term’ aspects of trading and fundamental information doesn’t necessarily affect the market immediately.
Sometimes fundamental news has the reverse affect on markets so one should be wary when trying to apply fundamental analysis alone.
For example: A news report that gets released that is ‘good’ for a particular asset, normally results in a sell off - so be wary
The idea is to ‘combine analysis’
- Technical
- Fundamental
- Sentiment
Find a good trade setup - then ‘Stick to the plan’
The thing about fundamental knowledge and information is that it can change in an instant, and retailers will be the last to know about these changes, mainly way after the fundamental impact has been ‘priced in’ to the market from inside traders.
Hope this answer helps
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Oh! yes. Thanks. I know of technical/chart analysis but, I am thinking of how to combine the two together; brought about the inquiry.
Great, so if you have a good understanding of the technical side then its far easier.
Applying the fundamental side will make more sense when understanding the economic calendar and looking for hot releases - for example: US GDP
When you have found a hot release and look at your technical graph you will usually see how the 2 combine together and gives a general sense of direction to look for. Still remember to apply your risk margins and not go ‘all in’ on trades!
Being patient and waiting for the ‘correct time’ to place your trade is imperative.
The big banks make price move. They have so much capital involved in forex that they cannot conceal when they are e.g. buying CHF or selling CHF.
The big banks have cleverer people working on more powerful computers with faster news flow and more information than we can even dream of. Why not let them do the FA for you, and just buy what they’re buying, sell what they’re selling?
That is a great comment. “The trend is your friend”, as they teach you in paid courses. LOL.
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Great post! completely agree
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Using a fundamental analysis is an advantage it helps in looking at the forex market by analyzing economic, social, and political forces that may affect currency prices.