Forex Trading Strategy

When it comes to successful Forex trading, there are 2 basic strategies used for the majority of traders:

• Fundamental Analysis
• Technical Analysis

In this article we will describe the fundamental analysis first

Fundamental Analysis
In fundamental analysis, Forex Trader look for causes that might trigger market fluctuations. These may include political activities, financial policies, growth rates and other factors.

As you can imagine, fundamental analysis of the forex market can be fairly difficult. For that reason most traders use fundamental analysis only to predict long term trends.

But a few fundamental analyze for short term trades could be review different currency values indicator that are released several times thorough the day, such as:

• Consumer Price Index
• Purchasing Managers Index
• Non Farm Payrolls (The mother of all fundamental Announcements)
• Retail Sales
• Durable Goods

In addition, there are meetings held that provide quotes and commentary which may affect markets. Examining the meeting reports and commentary can help Forex Fundamental analyst to better understand long term market trends and also allow short term traders to profit from important activities and events

If you decide to follow a fundamental analysis strategy, be sure to keep an economic calendar that shows when these reports are released. Your broker may also be able to provide you with real time access to this kind of information via the internet.