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Forex Trading Analysis Made Simpler

Estimated Reading Time: 5 minutes

Ali Qamar

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Forex Trading: Best Method of Analysis

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Forex trading is quickly growing and taking root in global financial systems.  It is seen as a quick-profit scheme, but the truth is, you can be stuck-up in “muddy waters” while trading.

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$ 1

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1

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1+

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$ 0 Commission 3.5

Mobile App
10/10

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$100

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100

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40

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Demo
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FCA

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Forex

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EUR/GBP

-

EUR/USD

-

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0.3

EUR/CHF

0.2

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0.0

GBP/JPY

0.1

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0.3

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No

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No

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No

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No

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No

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No

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No

BVIFSC

No

FSCA

No

FSA

No

FFAJ

No

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No

FRSA

71% of retail investor accounts lose money when trading CFDs with this provider.

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Total cost

$ 0 Commission 0

Mobile App
10/10

Min.Deposit

$100

Spread min.

- pips

Leverage max

400

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50

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Demo
Webtrader
Mt4
MT5
Avasocial
Ava Options

Funding Methods

Bank Transfer Credit Card Neteller Skrill

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CYSECASICCBFSAIBVIFSCFSCAFSAFFAJADGMFRSA

What you can trade

Forex

Indices

Actions

Cryptocurrencies

Raw Materials

Etfs

Average spread

EUR/GBP

1

EUR/USD

0.9

EUR/JPY

1

EUR/CHF

1

GBP/USD

1

GBP/JPY

1

GBP/CHF

1

USD/JPY

1

USD/CHF

1

CHF/JPY

1

Additional Fee

Continuous rate

-

Conversión

- pips

Regulation

No

FCA

Yes

CYSEC

Yes

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

Yes

CBFSAI

Yes

BVIFSC

Yes

FSCA

Yes

FSA

Yes

FFAJ

Yes

ADGM

Yes

FRSA

71% of retail investor accounts lose money when trading CFDs with this provider.

Rating

Total cost

$ 0 Commission 6.00

Mobile App
7/10

Min.Deposit

$10

Spread min.

- pips

Leverage max

10

Currency Pairs

60

Trading platforms

Demo
Webtrader
Mt4

Funding Methods

Credit Card

What you can trade

Forex

Indices

Cryptocurrencies

Average spread

EUR/GBP

1

EUR/USD

1

EUR/JPY

1

EUR/CHF

1

GBP/USD

1

GBP/JPY

1

GBP/CHF

1

USD/JPY

1

USD/CHF

1

CHF/JPY

1

Additional Fee

Continuous rate

-

Conversión

- pips

Regulation

No

FCA

No

CYSEC

No

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

No

CBFSAI

No

BVIFSC

No

FSCA

No

FSA

No

FFAJ

No

ADGM

No

FRSA

Your capital is at risk.

Rating

Total cost

$ 0 Commission 0.1

Mobile App
10/10

Min.Deposit

$50

Spread min.

- pips

Leverage max

500

Currency Pairs

40

Trading platforms

Demo
Webtrader
Mt4
STP/DMA
MT5

Funding Methods

Bank Transfer Credit Card Neteller Skrill

What you can trade

Forex

Indices

Actions

Raw Materials

Average spread

EUR/GBP

-

EUR/USD

-

EUR/JPY

-

EUR/CHF

-

GBP/USD

-

GBP/JPY

-

GBP/CHF

-

USD/JPY

-

USD/CHF

-

CHF/JPY

-

Additional Fee

Continuous rate

-

Conversión

- pips

Regulation

No

FCA

No

CYSEC

No

ASIC

No

CFTC

No

NFA

No

BAFIN

No

CMA

No

SCB

No

DFSA

No

CBFSAI

No

BVIFSC

No

FSCA

No

FSA

No

FFAJ

No

ADGM

No

FRSA

71% of retail investor accounts lose money when trading CFDs with this provider.

With accurate analysis, you can upgrade from getting meager earnings from a fulltime job down at the corner store, to a multi-billion investor seated in your vacation home wherever in the world.Forex trading in simpler terms is the selling or buying of currency pairs to make a profit.  In a case where profits are made, there is also an equal chance of making loses. So how do you turn your loss triggered fears into actual returns?

Forex analysis is the information used in making currency exchange decision by traders. The analysis is classified into five major categories; technical analysis, economic analysis events-based analysis, weekend analysis, and feeling-oriented analysis.

Five major Forex Analysis Categories

  1. Technical analysis

Analysis of this kind can either be done manually or through automated systems. The foundation of this method is using past trends in market behavior to predict future outcomes. Through these repeated outcomes, charts or programmed systems are generated by putting together market variables and mathematically calculating possible results.

Under manual analysis, traders conduct market research on particular securities and using price charts they can deduce repeated trends and sell or buy specific security. Automated analysis, on the other hand, uses computerized Forex software to predict currency pricing subject to past pricings in the market.

Far and wide, the technical mode of analysis is the most stylish and conventional way of Forex analysis. This can mostly be attributed to the straight-forward nature of the tools involved in the study.

  1. Economic/Fundamental analysis

Because Forex trading is all about exchanging currencies or securities, it is then adversely affected by other underlying economic factors. Some traders can decide to “kill the cat” from this approach. Using this method will require you have a clear understanding of how unemployment rates, interest rates, or Gross Domestic Product (GDP) affects economies.

In a nutshell, the economic analysis looks deep into a country’s economic, social, and political performance and how it can affect the demand and supply of its currency. When a state has a booming economy, and its political status is stable, then its currency will be highly demanded, causing its price to rise.

Forex traders are expected to research and predict the economic performance of countries. However, it is not advisable for beginners or people without any Economics background to use this model because of its complex nature.

  1. Events based analysis

Sometimes certain occurrences can lead to acute market distortions. Traders should to be on the look-out of such market-changing events and project a market trend and invest early enough.

An example of such a market-distorting event is a possible merger of two big companies. If two well-established companies were to merge today, there would be a probable increase in income.

Additionally, if an event occurred that could negatively affect the performance of these companies, a drop in revenue can be projected.  Forex traders are expected to predict such visible windows of investing based on such events.

  1. Weekend analysis

During weekends Forex trading platforms are relatively quiet because business comes to a close late Friday. The weekend analysis is not so different from events based analysis; it’s just that weekend analysis takes place on silent trading days.

As business comes to a close on Friday, active traders can make this opportunity to study the past market week and then use that analysis to paint a “bigger view” of the coming week.

  1. Feelings-oriented analysis

Sometimes Forex Markets can experience sentimental waves. Generally, these feelings are based on the expected performance of a particular currency. Such an indicator is beneficial in estimating the “market mood” and making appropriate investment decisions.

Every potential trader has a feeling of what direction the market may take. When all these possible sentiments are combined, there will be a predominant route that the market will take.  For example, if the stronger market feeling favors a particular currency pair, it will elevate in value.

Using Forex Market Analysis

  1. Market Drivers

Mostly markets are propelled by underlying factors, and as a trader, it is essential to understand those factors for successful trading.

  1. Recording indexes

Taking note of significant market trends can help you harmonize the relationship between the two markets.

  1. Trade timing

Successful traders will always know the strategic moments to enter and exit a market.

To sum it up, general Forex markets’ success cannot be attributed to only one mode of analysis. Correct and accurate market analysis can be achieved through a combination of the above mention market analysis structures. Although you’re trading time, whether short-term or long-term, it will give you the right combination of analytical models to use.

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