As you know, fundamental analysis can be very hard to understand for beginners like me and it’d be time consuming when learning it. Should I worry about it? Do you think that technical analysis is more than enough to make good and consistent profits?
What makes a good trader is a lot like what makes a good boxer or a good shooter…
A jab(technical analysis) is a very good punch but your combinations are going to be limited and you will only go so far or reach a certain level. So you need power punches as well e.g fundamental analysis…At the end of the day you need a mix of both.
A shooter does not turn up to a gun fight with one bullet in his chamber so why would you enter trading which can be considered a war between bulls and bears with one bullet ?
It can be confusing in regards to what basic level of information do you need to learn about each fundamental and technical to succeed ? That is why I am going to release a very simplified series to help newbie traders very soon- free on YouTube
Understanding fundamentals are of GRAVE importance.
When you are being ask upon for your justification in any particular trades. How you can appear more like a professional trader depends on it. It is your career image. Validation of us as Professional Forex “TRADER” are at stake.
With fundamentals, the stigma associated with a Trader are alleviated.
That’s a mindset, if you believe it then it will become true for you.
FA is itself a mindset, the market is a collection of minds, if you adopt an understanding of how that collection - the market - is thinking and reacting then suddenly FA becomes so sensical.
The most recent example is oil - learn how price first reacted to the Saudi incident - check the daily on WTI, then later when it became clear that supplies would be merely ‘interrupted’ .
I know many traders who shorted that rise based solely on that FA - but where did they get out?
At 50% of the rise which was also the most recent daily high - TA and FA working together.
To help you i figured a chart - imagine the up candle close (after the incident).
Then you have to imagine shorting that candle, let price rise and wait - that’s where the FA kicked in, then you have to imagine those shorts - they are in for the short term until the dust settles so to speak.
That’s when the TA kicks in, get out with profit and wait.
fundamental knowledge is a big deal in forex trading particularly for beginners level, its very tough to acquire with successfully. so i think beginner should ignore it for avoiding mental pressure.