Unconventional fundamental analysis. Part 3
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  1. #1

    Unconventional fundamental analysis. Part 3

    Seasonal analysis of currency pairs:

    Hi traders, I’ve decided to make small digest of my latest webinar called «Uncoventional fundamental analysis. Part 2» (read previous article on this topic here)

    In this series of 2 webinars I was describing 4 types of unconventional forms of fundamental analysis:

    1. Capital inflows/outflows (Currency futures COT reports)
    2. Historical tendencies (YTD lows/highs and macro cycles of price action)
    3. Seasonal tendencies
    4. Intermarket analysis.

    Whereas points 1 and 2 were covered in previous webinars and articles, now let’s talk about seasonal analysis. It is analysis based on understanding seasonal tendencies. Most traders undervalue this type of analysis – they think that seasonal tendencies are seen only on agricultural commodities. It’s explainable logic – any agricultural commodity has it’s times of harvest, when supply levels are highest. But what about other trading instruments? Research shows that seasonal tendencies can be found not solely on commodities but on stock indices, financials and currencies as well.

    Why does it work? There’s no magic beyond seasonality – every asset has it’s calendar cycles, you may never know why it works, but it’s proven and validated statistically.

    In seasonal analysis trader (analysis) relies on so called «seasonal curve» or «seasonal» (simplified and more frequently used). Seasonal is an «average» chart for some period – for example, 5 years or 10 years – it shows relative changes of price occurred within given calendar period. Most commonly used seasonals are 5, 10 and 15 years seasonals, more rarely used – 20 and 30 years seasonals (sort of higher timeframes).

    Picture below displays a chart of seasonal curve combined with recent price chart of a currency future contract:


    By the way – if you want to have seasonal information for currencies, you should analyze currency futures charts. For this purpose you may use any free website dedicated to seasonality (or use paid service of your choice). But I will attach here seasonal charts for 2 most popular currency pairs – EURUSD (6E future contract) and GBPUSD (6B contract).
    Before I do it, I wan to introduce you important concept that is called «Time-window opportunity». Seasonal analysis means that you should search for correlations between different seasonal charts (for example, 5, 10 and 15 years) and focus on situations when they move in one direction and overlap:


    Why time-window opportunities are important? Because they show you increased probability of price action within given time period. It usually lasts no longer than 1 month, so it’s not long term analysis like someone could think.

    There are examples of time-window opportunities from 2 major currency pairs:



    Here we see time-window opportunity for long trade that starts in March and ends in April, and for short trade that starts in August and ends in September.



    Here we see several time-window opportunities, but the most obvious is possible short trade in November.

    It doesn’t mean that seasonal tendencies are more important that current technical trends. Fundamental drivers are more important in the long run, technical – in short-term picture. And of course, if you had strong trend before but seasonal tendency tells you to go against trend, it can be a correctional move, not a big deal. But for most trading instruments that are going in some trading range, knowing your current seasonal time-window opportunity can help you to spot nice directional movement. Recall that we are talking about relatively short-term analysis. 3-4 weeks is not that much for fundamental analysis at all.

  2. #2
    It will really take lots of effort and patience to become seasonal traders as it requires to wait for long duration of time. And for this they should also be supported with sufficient capital money so that they can hold their trades during the floating period. Hence, most of the traders gets filtered in this phase itself and thus they will not be able to become seasonal traders to take the advantage of huge potential for making handsome money which is worth the wait.

  3. #3
    Fundamental analysis of the key steps in the forex market which is inevitable in the forex market and if you want to succeed very well in the forex market can learn well and fundamental analysis must also be trained at the expense of a trial long enough to learn how well fundamental analysis

  4. #4
    Trader Nizar's Avatar
    Join Date
    Aug 2013
    seasonal analysis is an important part of fundamental analysis as mentioned in this thread in the commodities example but also in the currencies it is important as currencies tend to move in a certain way during certain seasons like the end of the year or the end of each yearly quarter and also around holidays and annual events it has a certain way to move.
    Bend your view to the charts, not the charts to your view

  5. #5
    Registered user Quid's Avatar
    Join Date
    Feb 2014
    Quote Originally Posted by masonlogan View Post
    It'll actually get lots of hard work and also fortitude to become temporary dealers as it involves to wait pertaining to very long duration of energy. And due to this they ought to likewise always be backed along with enough capital dollars for them to carry their own trading during the sailing period of time. Therefore, a lot of the dealers gets tv in this particular cycle themselves therefore they do not manage to come to be temporary dealers for taking the main benefit of large likelihood of creating fine dollars that's worthy of the hang on.
    Lots of hard work here will not be enough,although we work hard forever we will stand in the same place or live a mountain who moves few cm each year we will stuck in the same place seeking for the holy grail,earn what we can earn don't hope for breaking the seal which exists.
    Finally successful traders

  6. #6
    Join Date
    Aug 2013
    This is a great learning tools which help me to increase my knowledge. I am waiting for new topics in this forum because I want to learn forex trade properly and this forum is the best way to get many new aspects to learn. Through this education tools came to know many aspects and I am trying to understand it through continuous study and practice.

  7. #7
    Quote Originally Posted by Meshmesha View Post
    We must all traders are looking for a profit in the Forex market and to achieve this they avoid making the wrong decisions when trading in Forex and equip themselves in terms of mentality
    Forex day trading is a common patterns in the forex market, which is characterized by the closure of the rolling position in which he has open within seconds or a few hours at most
    Technical Analysis of the most important and the best methods of success in the forex market if you want to succeed in the forex market and succeed in the formation of high profits in this market must possess a good trading strategy learn how it analyzes the currency well in this market

  8. #8
    fundamental analysis is the best way to trade and here most of the trader trade base on it and the main thing is that in forex market most of the trader are looser and it is fundamental analysis which is the only thing that can help you from loosing in scalping.

  9. #9
    Quote Originally Posted by gmmasud88 View Post
    fundamental analysis is the best way to trade and here most of the trader trade base on it and the main thing is that in forex market most of the trader are looser and it is fundamental analysis which is the only thing that can help you from loosing in scalping.
    I'm not doing my technical analysis in the forex market at all, I am still of Kabtdin in the forex market and am trying to learn and I am training well in the forex market so successful in achieving high profits in this market and I am currently working in the forex market by using the recommendations of the various sites of the recommendations

  10. #10
    Registered user
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    Mar 2014
    Of the first and the most important reasons for success in the forex market is that you make a good analysis of the fundamental and must possess a successful trading strategy can help you achieve high profits in the forex market and help you work on the technical analysis of good

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