What is the difference between a fundamental analysis on the stock market and the FX? - Page 5
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Thread: What is the difference between a fundamental analysis on the stock market and the FX?

  1. #1
    Super Moderator Gulfstream's Avatar
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    What is the difference between a fundamental analysis on the stock market and the FX?

    There are many significant techniques that determine the direction of movement of currencies and assets.
    Undoubtedly, fundamental analysis is one with the highest priority.

    The value of fundamental analysis is often underestimated or misunderstood by beginning traders.
    A lot of people believe that this type of analysis is useful only to investors or traders with long-term positions. However, it is not like this. If you know the basics and concepts of fundamental analysis, you have an opportunity to find the dynamics of financial markets, which are very important for the development of the trader, regardless of the role of
    fundamental analysis in daily trading.
    The fundamental analysis will be divided into 2 segments of the financial market: the currency and the stock market.

    I will try to cover as much as possible in detail by answering the questions:
    - What is the fundamental analysis and how does it affect the priority of movement?
    - What are the features of the fundamental analysis of the currency and stock market?


    And also I will try to disclose the basic methods of fundamental analysis for stocks, bonds, CFDs and other assets, which are represented on the stock market, with a phased disclosure of the sub-topics:
    - What factors influence the movement of an asset and the stock market as a whole?
    - How to evaluate correctly published news and reports for companies, whose shares are traded on the exchange?
    - Where and from what sources it is possible to receive information about the impact on the movement of an asset?

    When you trade on FX market, you should know the answers to the 2 basic questions:
    - what news you should consider the most important of those published in the news line / economic calendar;
    - how you should read the news and determine their impact on the movement of currency pairs and tradable assets;
    - what economic and political factors you can consider as significant ones for work in the FX market.


    In the segment of the fx market, I will present an assessment of the following fundamental factors according to their degree of influence:
    - macroeconomic statistics of countries-issuers of a particular currency and the largest economies of the world;
    - the results of the meetings of the world's largest Central Banks;
    - Specific factors that affect individual currencies.


    On the stock market, the influence of key fundamental factors:
    - corporate reports of companies;
    - sectoral statistics and forecasts;
    - macroeconomic statistics, especially in the largest economies of the world;
    - meetings of the world's largest Central Banks.


    A distinctive feature of the fundamental analysis of the stock and currency market is that the stock market analysis is conducted on a specific company, its activities and profitability are studied, basing on the published reporting data and company news, etc., along with the economic and political situation in the country.


    During analyzes of the foreign exchange market, the movement of currency pairs is investigated and forecasted. Since there are two currencies of different countries in one pair, the influence of both factors is considered. So, in dollar currency pairs, in which the dollar is quoted, first of all, the economic statistics of the USA and the second presented currency are studied, it is revealed - what news will be the most important and can significantly affect the movement of the currency pair in one direction or another.


    Reviews of the use of fundamental analysis techniques, as well as specific options for market reaction
    on those or other events will be presented on real graphs and examples.


    What is the fundamental analysis and how does it affect the priority of movement?
    Fundamental analysis is represented by methods of assessing and forecasting the forthcoming movement of financial markets and its specific instruments. These methods are based on macroeconomic, financial, production, industry and other data relating to a particular market or instrument.
    In other words, fundamental analysis is engaged in assessing the situation from the point of view of political, economic and financial-credit policy. Information on the interest rates of central banks, the economic course of the government, possible changes in the political life of the country, as well as various kinds of rumours and expectations are important in fundamental analysis.


    In practice to conduct fundamental analysis is not so simple. The same factors may have different market value in different conditions or may become decisive from insignificant ones.


    Thus, the success of a trader in conducting a fundamental analysis depends on an understanding of the laws of the financial market, the ability to compare absolutely unrelated events at first glance. Also, a fundamental analysis assumes knowledge of the general picture, specified by the published news only.
    The fundamental analysis allows us to assess the factors, that can affect the movement of exchange rates over a period of several days to several weeks.


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  2. #41
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    Quote Originally Posted by Nova View Post
    In forex trading, we can have better chances of making a good analysis and being profitable and I think one most incredible thing that would make me stick to forex trading market is that it is more volatile, both stock and Forex market will get the impact to each movement and volatility because investors who see the issues will try to analyze the outcome if that problem can not be solved.
    both are same i think sometime can volatile and some time can be lazzy but here forex is more good here we can use some currencies pair and i think its easy to use and easy to analyze. we can get news about pairs more easily if a forex trader is successful its good for him never should go for stocks. i am not sure but they can have timing like metals?

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  3. #42
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    Quote Originally Posted by altafch View Post
    both are same i think sometime can volatile and some time can be lazzy but here forex is more good here we can use some currencies pair and i think its easy to use and easy to analyze. we can get news about pairs more easily if a forex trader is successful its good for him never should go for stocks. i am not sure but they can have timing like metals?
    I don't know much about the stock market, but I know much about the forex trading market and what I know is that the forex trading market we get to have good movement when the news is in play however, that doesn't mean that we should then go for the news trading. Because news trading isn't going to be specific on what we have to do, more like gambling.

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  4. #43
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    Quote Originally Posted by Striker$ View Post
    I don't know much about the stock market, but I know much about the forex trading market and what I know is that the forex trading market we get to have good movement when the news is in play however, that doesn't mean that we should then go for the news trading. Because news trading isn't going to be specific on what we have to do, more like gambling.
    when you trade on stocks and want to get the possible next movement, you can pay attention to the news that related to currency of that products in stock. for example, you can use some news like fomc or rate hike to see how's us stocks products like nasdaq and snp500 react to the result of news. i think it's easier to trade stocks by using fundamental analysis rather than with forex market because in forex, we must understand two different currencies at the same time before we can use fundamental analysis.

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  5. #44
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    The thing is that forex trading is way more better, so much volatility and then also more liquidity and then we can see that forex trading is way more regulated and then hardly can be manipulated, not just like the stock market that I have been able to have seen huge gaps some times and then some time, price just goes south all of sudden.

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  6. #45
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    i think there should not be difference into both, we can trade properly with technical if anyone ask from me, but if anyone want to make fundamental trading i think its way to lose money here it can give us big loss into small time but technical is profitable way so we should use it properly. fundamental is not a good way for trading its my own experience

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  7. #46
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    I think it's easier to trade stocks by using fundamental analysis rather than with the forex market because, in forex, we must understand two different currencies at the same time before we can use fundamental analysis. I believe that we can measure and know more about what might happen in a Forex environment than we could in the stock exchange markets with fundamental analysis.

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  8. #47
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    Fundamental news is a bit different in the Forex market and the stock exchange markets, but they both carry same weight, if there is a hurricane in the United States of America, this will have a negative toil on the dollar, the same way the dollar will fall in the floor of the new york stock exchange, is same way it will be replicated in the Forex market, the event that caused the fall is similar, this is an example of what could make the news to have a similar effect both with the stock exchange markets and the Forex itself.

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  9. #48
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    Quote Originally Posted by Leonvic View Post
    Fundamental news is a bit different in the Forex market and the stock exchange markets, but they both carry same weight, if there is a hurricane in the United States of America, this will have a negative toil on the dollar, the same way the dollar will fall in the floor of the new york stock exchange, is same way it will be replicated in the Forex market, the event that caused the fall is similar, this is an example of what could make the news to have a similar effect both with the stock exchange markets and the Forex itself.
    Can't say much about the difference between stock and forex market with fundamental analysis because I've never been trading with any stocks before and only focus on forex market. Moreover, I don't use fundamental analysis that often even in forex market because my aim is to trade with technical analysis with market. From many posts I read here including yours, I can assume that the impact to both market is equal related to one same news.

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  10. #49
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    Quote Originally Posted by Silhouette View Post
    Can't say much about the difference between stock and forex market with fundamental analysis because I've never been trading with any stocks before and only focus on forex market. Moreover, I don't use fundamental analysis that often even in forex market because my aim is to trade with technical analysis with market. From many posts I read here including yours, I can assume that the impact to both market is equal related to one same news.
    market and pairs can be different but way of trading can be same so here fundamental way consist of some news, we can use news into right way if we know their meaning if we know their real time working, if we do not know them we can lose easily, so a trader should use a way to earn properly and it is possible when we learn from deeply, in fundamental people think they can earn easily but that is not possible, news are also complex but this is also reality we can earn more here then technical

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  11. #50
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    Quote Originally Posted by naeem555 View Post
    market and pairs can be different but way of trading can be same so here fundamental way consist of some news, we can use news into right way if we know their meaning if we know their real time working, if we do not know them we can lose easily, so a trader should use a way to earn properly and it is possible when we learn from deeply, in fundamental people think they can earn easily but that is not possible, news are also complex but this is also reality we can earn more here then technical
    I think the stock market is more moved by fundamentals, in such a way that you could wake up to a huge gap and that is not the same in forex trading, as the forex market is more of the bigger boys buying and selling. I thin in general terms, in the risk and all things about the two, I think forex risk can be well managed more better than the risk on stock and also forex can be traded with little account size.

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