Sun 2 Apr 2006
Last time we discussed long and short time strategies on Forex market. There we explained why short term trading Forex strategy is the best. In fact in real world of Forex market 80% of all transactions is 7 day or less long.
And if you are trading short term you can’t rely on macroeconomical forecasts only. There are two ways to forecast your Forex trading strategy - technical and fundamental analysis. Most analysts are generally divided into those two groups. But you are Forex trader (or wannabe).
As a Forex trader you need to gain experience in both technical and fundamental analysis to be successful in the market of foreign currency exchange.
Briefly - technical analysis can forecast future market situation by knowing how it was during last hour, days or weeks. Lot of matematics are involved.
Fundamental anlysis is based on macroeconomical analysis and involves not only market monitoring. You need to digest all news around the world and made your forex trading strategy according to them.
One small note - between important events (for instance some financial news or large market shifts) foreign currency exchange market moves in trends. You should not belive that cross rates are moving randomly and unpredictable. This is your core.