What is the difference between a fundamental analysis on the stock market and the FX? - Page 7
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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. #61
    Trader Silhouette's Avatar
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    Quote Originally Posted by touqir View Post
    we can use and can understand but still we can lose, this is based on future and in future anything can happen just our proper sl can limit our loss if we do not have sl into trading we can not survive for long, fundamental is bad way because news not have proper way to give us reason to buy or sell but we can use some technical which is good way to give us good signals
    Both fundamental and technical analysis offers various simplicity and rules for traders to understand about different methods to trade with forex market. Each of them has their own best tricks and techniques to do it properly so we got to choose which one that works for us the most. Remember that fundamental analysis isn't only about news, it has bigger picture and news just a simple method how to trade it in fast mean.

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