What Sourses Are Used In Forex Fundamental Analysis?
For the fundamental analysis of Forex market, as well as for any stock or commodity markets it is applied data announced for this purpose of special analytical reviews and graphs and tables of numerical indicators – indicators for fundamental analysis. The last ones are announced usually monthly (except for data about gross national product and employment index, announced quarterly).
The basic distinction between Forex fundamental analysis and technical analysis is that fundamental analysis is based on the position: the prices of currencies in the Forex market is reflection of supply and demand, which in turn rely on the fundamental factors of the economy.
Followers of the technical analysis say that you do not have to look for the cause of changes in currency exchange rates and it is enough to analyze the prices. It is believed that it is impossible to detect a reason for the change in prices before the market will already catch to include it in the price. Technical analysis often deals with shorter intervals of time from minutes to weeks. At these intervals (time frames) the fundamental analysis, except for one of its species (trading on the news), is practically useless, since the very fundamental data usually come out once a week, month, quarter.
Any indicator for fundamental analysis is a pair of numbers. The first number is the index for the reporting period. The second number – is an updated indicator for the month foregoing the reporting period. For example, in July economic indicators are announced in June (reporting period). Besides them the report contains the value of the same indicators for May. This is done for the reason that the establishment responsible for collection economic statistics obtains at the time of publication of the indicator for June more complete information for May that is very important for traders. If, for example, the value of economic indicators over the last month is at 0.4% better than expected and the antecedent month is corrected to less than 0.4%, the trader is able to make a reasonable conclusion about the shift in the state of the economy. Economic indicators are published at different times. In the U.S. they are usually announced in half past eight half past ten at Eastern Time. It is important to remember that the biggest part of information about the foreign currency is available in half past eight in the morning. That is why the U.S. currency market opens in 20 minutes after 8 in the morning in order to have time to study the latest data for fundamental analysis.
Information about economic parameters is published in all leading newspapers, for example the Wall Street Journal, Financial Times, and New York Times and magazines for the business world, such as Business Week. There are reasons to suppose that traders actively use electronic sources – Bridge Information Systems, Reuters and Bloomberg – for getting information from newspapers and from hand sources of present information.
Currently people are looking for additional or even primary sources of income as never. World economy is still in tough condition, and to find a well-paid job is not that easy task. And forex is one of the ways to earn some money. To trade successfully one needs to know events on the market, so forex news is of great help here. Those who don’t know where to get forex market news can take advantage of the Internet. Just type “forex news trading“, for example, in Google or other search engine and you will get many news sources to choose from.