Forex Trading Fundamental or Technical ?

What is a fundamentalist and a technicalist? Here, among traders known 2 "flow" traders are: fundamentalist and technicalist. This distinction is based on the trend of analysis used by each trader. In general there are two types of analysis in forex trading.

Fundamental Analysis
That analysis is based on news (news) that affect the value of the currency that we trade. Traders who use fundamental analysis in trading are often classified as fundamentalists. They pay attention to the news (news) that affect the currency value of the pairs that they trade. There are many news that can affect the value of the currency, whether the influence directly or indirectly. What are the influential news? In general, news is usually related to the economy or politics of the country whose currency we trade. So for example we trade the pair EUR / USD, then we need to pay attention to news from European countries and the United States. Maybe you think: weh, complicated doong ... then where can we monitor or find out the news? Do not worry, there are now many sites that provide data about the news along with the expected effect on certain currency pairs.

So if you are more willing to join the fundamentalist, frequently visit the sites that provide news related to the movement of currency values. Or, brokers where we trade also usually provide a notification (alert) about the news. Well, the fundamentalist is much use of the movement of the chart that is usually experienced an extreme movement moment before and after news out. For certain pairs such as GBP / USD, the movement ahead and after the news can be 20-50 pips in not more than 15 minutes. That's why the fundamentalist usually enliven the market when news is released.

Technical Analysis
Unlike fundamentalists, technicalist traders prefer to "get away" from the market just before and after the news is released. They likened the rapid movements because of the short-term news effects like the pool being stirred by the water, making it look "murky". That is, the "original" movement of a pair is not visible at such moments so they choose to wait for the "water" to calm down and show their "true character" back.

The technicalist is more basing the analysis on the history of chart movement. In essence, these technicalists believe that the history of the chart movement will be repeated, and in something that looks random, hidden certain patterns which, if understood, can be used to find out what is and will happen on chart movement. Trader technicalist "communicates" with charts through indicators. From the signal given by this indicator, can be known what is going on or "done" by a pair.

Questions such as: "What is this GJ doing? Where to go, up or down? "Can be answered by looking at the signal given by the indicator. There are many indicators that can be used in forex trading. Usually each trader technicalist has an indicator that is their mainstay, in accordance with their understanding of the indicator.

Well, you choose to be a fundamentalist or a technicalist? Um, actually it does not have to be clearly differentiated like that anyway. There are also traders who choose to be both. They have indicators that become a mainstay, but also enliven the market when news is released. All legitimate, like-we like too kok. That's how good it is to be a trader.