Choose Forex Strategy

Technical analysis and fundamental analysis are the main areas of research for trading strategies on the forex and the stock market. However, technical analysis is by far the most common strategy among individual Forex traders. We will present here a brief overview of the two types of analysis and explain how to apply them directly to Forex trading:

Basic analysis

If you think it's hard enough to evaluate a company's performance, you'll need to evaluate the forex market for a whole country rather than a company. Fundamental analysis on Forex markets is often very difficult and is generally used to predict long-term trends primarily. However, it should be noted that some traders use fundamental analysis in short-term trading when publishing important news.

There are a lot of key indicators that affect the value of the currency and are issued at different times. We will mention below a simple example with which you can start.

* Report on non-agricultural employment

* Purchasing Managers Index (PMI)

* Consumer Price Index (CPI)

* Retail sales

* Durable goods

You should also be aware that these reports are not the only underlying factors to watch out for. There are a large number of meetings where you receive comments and quotes that may affect the market movement, as well as any economic report. These meetings typically deal with interest rate, inflation and other issues that may affect the value of the currency.

Even changes in the way of formulating certain things to deal with certain issues such as the US Federal Reserve's statements on interest rates; May cause volatility in the market. You must also always keep a close eye on two important meetings: the FOMC meeting and the Humphrey Hawkins auditions.

By reading these reports and reviewing the comments that accompany them, they help forex market analysts better understand all the long-term market trends and allow short-term traders to reap the benefits of unusual events. If you decide to follow one of the basic analysis strategies, you should always have an economic calendar with you at all times to be informed of the timing of these reports. Your broker may also be able to provide you with instant access to this type of information.

Technical analysis

Like their counterparts in equities, technical analysts of foreign exchange markets analyze price trends. The only difference between technical analysis on Forex and technical analysis of equities is the amount of time that relates to the fact that the Forex market is open for 24 hours.

For this reason, some forms of technical analysis need to be adjusted to work with the market over a 24-hour period. Here is a set of technical analyzes commonly used in the Forex market:

* Elliot waves

* Phoebe Nachi Studies

* SAR equivalent

* Pivot points

Many technical analysts tend to combine technical studies in order to achieve more accurate forecasts. (The most common method is to combine Vipi Nachi and Elliot Wave studies). Others prefer to create trading systems to try to identify recurring buying or selling conditions.

Choose your strategy

Most successful traders develop a trading strategy and apply it over a period of time. Some of them focus on a particular study or account, while others use a broad spectrum analysis as a way to identify their business. Most experts believe that using a combination of technical and fundamental analysis can provide long-term forecasts as well as entry and exit points. Of course, in the end, it is the trader who will decide the best way for him.

When you're ready to start the Forex market, you need to open a demo account and test your strategy on paper, then practice to earn profits on a continuous basis. Many failed traders tend to get into the Forex market and lose a lot of money in a short time due to a lack of experience. So you must take your time to learn and exchange a driver before you start using your head.

You should also be able to negotiate without emotion. You will not be able to track all stops if you can not run them on time. You must also set breakpoints and take profits until they run.

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