Forex analysis — covering all aspects of forex market analysis

In this section we will handle the subject of forex analysis in much greater detail, with the hope of providing you a framework with which you can create your own approach and style of analysis.

We will attempt to provide general principles to be adhered to while performing the two types of analysis — fundamental and technical — and then we will look at the indicators and news releases in detail. The golden rule is that the trader should always aim to create a holistic picture from the patchwork of data that he has to go through on a daily basis. He should create models, and test them in light of market developments and the fundamental changes occurring in the analyzed nation’s economy. A mere knowledge of the data, without the power to evaluate and reconstruct it to suit our purpose, is unlikely to be very beneficial. The successful trader succeeds because he understands, while the unfortunate one fails because his attention span is too short to evaluate the information.

Technical analysis

The Perils of Forex Backtesting — how to evaluate a technical forex strategy

Backtesting of technical methods in light of past prices is the most popular testing strategy among technical traders.

Forex price action — reading the language of the market

Those with even a brief experience with charts know that price action on an ordinary day is highly unpredictable and volatile. In this extensive presentation we equip the reader with the knowledge needed to understand the language of the forex market.

Forex oscillators — the predictive value of divergence and convergence

Oscillators give the trader limit values which he can use to evaluate the price action. Divergence and convergence, as they are termed, are held to offer predictive value since they occur more seldom than the parallel movements of the trend and the oscillator.

Forex trend indicators

The indicators covered in this article are used to gauge the strength and direction of a trend. The importance of trends has been a recognized fact for many years and trend following has granted its followers great profits over the years.

A few general principles on technical analysis

Different market conditions call for different methods of analysis. In this short article we provide an overview of the tools available to technical analysts and briefly discuss which indicators are best to interpret ranging and trending markets.

Fundamental analysis

Forex and the Yield Curve: Understanding Interest Rates

Whether one is a technical or fundamental trader, there is little disagreement that forex prices depend very strongly on the interest rate differentials between currencies.

The power of fundamental analysis: George Soros and the Bank of England

There are many traders who successfully used fundamental analysis to obtain great wealth, but the exploits of George Soros, and his Quantum Hedge Fund have made them legendary.

A step-by-step guide to fundamental analysis of the currency market

In this brief guide we will try to provide you with a step-by-step plan for analyzing the global economic environment, and deciding on which currency to buy or sell.

The Treasury International Capital reports — gauge inflow of capital with the TIC report

The Treasury International Capital reports measure the monthly demand for US private and government securities. The TIC report measures the US financial account, and is of great importance in demonstrating the inflow of foreign capital into the US.

How to use fundamental analysis to profit in forex

The forex market is the market par excellence for fundamental analysis. As we move onto study its practical applications, we’ll examine the use of fundamental analysis in the form of a dialogue between a successful trader, and a beginner.

The basics of fundamental analysis

In this section we examine the economic indicators released by governments, central banks, and statistical agencies. Our goal is to show you the interactions between the various data, and how the fundamental factors influence trends in currency markets.

Don't forget to have a look at our forex strategy section where we go into the specifics on how you can structure a profitable forex strategy.