Forex Forecasting : Three General Types of Market Analysis. Which One The Best?

Forex Forecasting :  Three General Types of Market Analysis.

There were traders  in different types of forex forecasting, how traders made some Market Analytics and used it as basic for decision buying or selling currency/ CFDs /Stockcs. Each trader has their own favorite method. In general, these types of market analysis were  generalized in three types :

1.    Technical Analysis
2.    Fundamental Analysis
3.    Sentiment Analysis

It is true there  many fanatic ( of a certain market analytics) traders claimed that technical analysis is the best one for giving superior forex signals, or other groups said fundamental  analysis much better, or some said sentiment is more precise. Don’t be confused. The three types all are the best. It’s just like if you have three different legs, if one of them broke, you feel the pain.
Technical analysis is the study of price movement on the charts, fundamental analysis pointed at how the country’s economy condition and  Market sentiment analysis determines whether the market is bullish or bearish on the current or future fundamental outlook.
Every types is essential for your trade, depending the situations.  No need tu rush and don't think about fast track to forex. Learn it all step by step, practice it and time after time you will learn how to use these different type dealing with certain situation and taking advantaged gaining profit or minimized risk from it. Every type has it's own advantage to generate trading signals based on certain conditions, sometimes they need to be mixed, it's depend on you. The point is, goo trade as you like. as long as you generate green pips then you did in the track.

The Basic 2 : Trading FOREX

What is trading forex?

Why you should traded?

The quick answer is MONEY. In forex, you’re not buying anything physical. Think of buying a currency as buying a share in a particular country, its kind of buying stocks of a company. The price movement of the currency is a direct reflection of what the market thinks about the current and future health of a certain country’s economy.

A simple way to understand, say, if you buy  the Pound Sterling then you are basically buying a “share” in the U.K economy. You are asuming that the U.K economy is doing well, and will even get better in the future. Once you sell those “shares” back to the market, hopefully, you will end up with a profit. In other words, the exchange rate of a currency versus other currencies could be a reflection of the condition of that country’s economy, compared to other countries’ economies.

Forex trading is the contingously market where people buying of one currency and selling another. They  are eventually traded through a broker or dealer. Curency are traded in pairs; for example the Pound Sterling and the U.S. dollar (GBP/USD) or the Pound Sterling and the Japanese yen (GBP/JPY) etc.

The Basic 1 : What Is Forex ?

I'm not a Forex Mentor, but here is a brief definition for you about forex. Let’s said, you are American and went to United kingdom. In the U.K airport, you might find a currency exchange booth at the airport, also you might seeing a screen displaying different exchange rates for different currencies. And then you exchange the money ( $USD) you have into pound sterling (£ GBP). You do that and basicly you’re participated in the forex market! In other words, due to forex terms, assuming you’re an American visiting U.K, you’ve sold dollars and bought Pound Sterling.

Forex, or FX a.k.a foreign exchange market is the largest financial market in the world. Compared to the measly $22.4 billion a day volume of the New York Stock Exchange, the foreign exchange market looks extremely large with its $5 TRILLION a day trade volume. The largest stock market in the world, the New York Stock Exchange (NYSE), trades a volume of about $22.4 billion each day. Now, forex market brought to your home. You can participated into forex market as long as you  haveinternet connection. Online forex trading became a huge industri nowadays and who knows, you can taking advantages on it.

Before you jump into the forex market, it is a good idea to do some research. Learn about forex, join international forum and forex international clubs that opening discussion about forex, surf internet, find the community.

Just remember the rules, greed when other fears and fears when other greed!

Forex Indicator : Moving Average

Basic Moving Average Learning

Moving average  (MA) is a trend following indicator. Moving average is widely used by traders in the world because it is versatile and easily constructed. It indicator for follow trends in the movement of a currency. Moviing average identify and signal to a technical trader that a new trend, a sustained movement either up or down in the currency, has begun or that an old trend has ended or reversed. It is easier to see using a moving average is that it acts to smooth the volatility inherent in looking at the price action alone to recognize trends.

Moving Average could shows you the average price in the period of time.  Moving Average of different types (Weighted Moving Average (WMA), Exponential Moving Average ( EMA) and Simple Moving Average (SMA) ) differ from each other only in terms of weight coefficients, which are assigned to the last data.

The basic to use moving average is to just plot a single moving average on the chart. When price action tends to stay above the moving average, it would signal that price is in a general uptrend and if price action tends to stay below the moving average, that indicated downtrend.

Here is the illustration: 

The red line is Moving Average. Price action represented by candlestick chart, tends to stay above the red line (Moving Average). In this case, we can say that current trend is uptrend ( bullish).

Some trend followers use this indicator to make forex forecasting and made decision. Is it that simple? The answer is NO. This only basic used of moving average. The fact is, you need to practice use this indicator in different terms and sometimes you need to set up more than one moving average on your chart in order to provide more qualify signals.