As mentioned in the previous article (Forex = Gambling, Negative Rumors about Forex), playing without knowing forex analysis means we do gambling in it. And obviously, with the gambling will lead to losses. Unfortunately events like this not only experienced a few new players in the forex world. There have experienced loss of tens to hundreds of millions of realized without a good analysis the forex trading with gambling.
That's why learn forex attempts to emphasize the importance of analysis in forex trading. Without it, we would not expect to benefit in the long run. If any benefit, usually because of luck and will not last long. In a matter of weeks to months, all our funds are usually sold out because of the lack of knowledge of analysis.
So it can be concluded that knowing the analysis of price movements is an absolute unknown to forex players.
Broadly speaking, the analysis in forex trading is divided into two ways, namely Fundamental analysis and Technical analysis. Both are based on the assumption that different from one another. You can see the divisions in the diagram below:
That's why learn forex attempts to emphasize the importance of analysis in forex trading. Without it, we would not expect to benefit in the long run. If any benefit, usually because of luck and will not last long. In a matter of weeks to months, all our funds are usually sold out because of the lack of knowledge of analysis.
So it can be concluded that knowing the analysis of price movements is an absolute unknown to forex players.
Broadly speaking, the analysis in forex trading is divided into two ways, namely Fundamental analysis and Technical analysis. Both are based on the assumption that different from one another. You can see the divisions in the diagram below:
Fundamental Analysis
If you've ever heard on television about the rise in global oil prices or the decision of the Federal Reserve, the Fed to raise interest rates, it is called fundamental news. The news greatly affects price movements in the market and a very large effect on an investor's portfolio in the world of forex. The analysis rests on fundamental economic news is called fundamental analysis.
Fundamental analysis found the price to move because of the news and government policy, and the market response to the news released.
In fact fundamental news like this is moving the price in the forex market. Any news that has been or will be appearing elicit a reaction from the market or traders that led to a change in price. That is, news that appears to make changes to the price of the currency of the country concerned. This change in turn prompted the government as monetary authorities determine economic policy that appears next new fundamental news. And so on the spin cycle.
For a fundamental analyst, speed, accuracy and ability to predict the news (forecasting) the market reaction to the news issued is a vital component of the absolute must-have. Without the above factors, it is difficult for a fundamental analyst utilizing existing news to gain profit.
Take a simple example. For example, when we heard the news that the Fed has just raised interest rates by 25 basis points (equal to 0.25%) a few minutes ago (here is no longer a matter of hours, but minutes and even seconds! Left behind in a matter of hours means the opportunity has passed! ), in general it is the USD will strengthen and position Buy doable. Well, let's say you hear this news after 2 days later. This important news was not any good anymore because the market has reacted even finished already entered a period of correction possible. So, the speed gain is very important news here. So did you hear the news source. No matter the news you hear is not valid throughout the market have the same perception of you. Its size is the market, not on the truth or falsity of the news.
In the world of forex, there are more than 50 types of fundamental news released by each country and each story has a different effect on price movements. Well, now the question that remains is, what are the 50 to the news? And what about the influence of each story appearing on currency movements?
Two questions will be answered in the article above fundamental analysis is more intensive. Not in this article because this article only discusses introductory concepts before you start analyzing both technical analysis and fundamental.
Fundamental analysis is the basis of the information / news (news) derived from:
Official agencies / Government
Print / electronic
Individual
According to the source, the Fundamental methods are subjective, depending on the degree of trust Investor / Consultant to the news source.
Technical Analysis
In contrast to fundamental analysis, technical analysis went on thinking that price movements can be predicted from the past. That is, the series of past price movement data, we can predict future movement. Something very unreasonable fundamental analysts.
Method of Technical Analysis is a method to analyze the past data of the market price data, volume and open interest to predict the future price trend on dating.Data-data is then presented in the form of charting (CHARTS).
In the calculation of basic technical analysis is a mathematical fact that most of them are statistical and the science of chaos theory (pattern recognition). So it took the exact approach. Thus the results obtained can also be a number that exact and definite. Something that can not be given by the fundamental analysis. Some technical analysts even says so: "Technical analysis is a trading cheat".
If so, is it better than technical analysis fundamental analysis? No. Remember, that the fundamental news that childbirth is a fundamental analysis of the real movers of the market, not technical analysis. According
Learning forex, each has advantages and disadvantages of each. Technical analysis is known because of the inexact and can be applied to any method of trading (day trading, weekly and even monthly to yearly). Known as fundamental analysis can predict a significant and sudden movements that are caused by the release of important news. Here we extracted in tabular form:
Weakness on weakness in Fundamental Analysis Technical Analysis
It takes time to gain information. Requires a lot of data to support accurate prediction.
Often it is subjective because it involves many people's opinions. Relies heavily on the ability of chartist. Each chart ist has different methods and each is not necessarily suitable to be applied to each other.
Weakness on weakness in Fundamental Analysis Technical Analysis
It takes time to gain information. Requires a lot of data to support accurate prediction.
Often it is subjective because it involves many people's opinions. Relies heavily on the ability of chartist. Each chart ist has different methods and each is not necessarily suitable to be applied to each other.
More suitable to be applied to long term trading period.
Difficult to apply in an inefficient market.
Back about technical analysis, as in the diagram shown by Youmustreadfirst, technical analysis is divided into three major indicators, Fibonacci sequences, and Elliot Wave Trading. Indicators are a series of formulas created by science and statistics are used to predict the trend, the point of support, as well ressistance overbought and oversold. While Fibonacci and Elliot wave sequence analysis based on pattern recognition based on the pattern of numbers and graphs available.
There are more than 50 types of indicators that you can learn in technical analysis, Elliot wave pattern standard 11 (not including derivative trading that developed individual and community research lab or some other). While basing his calculations on the fibonacci sequence fibonacci sequence is widely used to calculate the movement of random objects that have a certain pattern (such as currency price movements).
For now Belajarforex has provided fundamental lessons from some of the indicators you need to know. Expected at the times to come, as well as articles about Fibonacci Elliott Wave will be displayed. All this with the aim to equip you as an investor or prospective investor in the world of forex trading.
Short Quiz
1. Mention (min 5) types of indicators are included in Technical Analysis?
2. What do you know about the following terms:
• Support Point.
• Ressistence Point.
• Psychological issues in running Investing Forex Trading
Instructions:
1. Types of Technical Analysis Indicators:
• Simple Moving Average
• Exponential Moving Average
• Weighted Moving Average
• Bolinger Bands
• MACD
2. Here is an explanation
* Point Support: The lower limit of the price movement.
* Point Resistance: The upper limit of the movement.
* Diseases in running Investing Forex Trading:
a. Greed: Greed: The pursuit of profit (Profit) excessively large (Explosive)
b. Revenge: Revenge: As has been Lost (losses), then to the alternatives, open position back again without a clear calculation.
c. Relying on emotions / feelings. Examples: feeling happy, good day, not a theoretical prediction, etc..
d. Trading does not have a clear system.
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