The Tutorial To use Fundamental Analysis
In Forex Trading System
Now we will discuss how to predict the price movement according to a country’s economical, social and political condition. This condition affects the value of related currency compared to other currencies. Powerful countries, economical, social and political will have higher currencies’ values than other countries.Fundamental Analysis
Learn forex trade, you will find about 2 types of price movement analysis in forex trading system. They are fundamental and technical. First we will write about fundamental Analysis. To get fundamental data, a forex trader is usually using information available in some media, such as news paper, data sheet, internet, TV, and so on. Media will also add some more reviews and price movement prediction.
Fundamental data is commonly published every month, except for GDP and Employment Cost Index which are published ever 4 months. All of fundamental data are published in pair.
This first figure is showing the last month’s result, while the second figure is showing this month’s prediction.
Commonly, fundamental data are published sometimes before as a prediction or a forecast. In the forecast, the second figure is the closest number of prediction, and when the official figure is announced, this second figure will change into the official data for a month.
The month here refers to the active month where the issued data is valid. For example, if a fundamental data is issued on a monthly basis on the 4th week of April, so that data will be valid for the whole month, April.
The figures in fundamental data are displayed in pairs, in order to illustrate the changes (better/worse) from the previous month to the current month.
Fundamental Indicator
Economic Indicators
- The Gross National Product (GNP)
- The Gross Domestic Product (GDP)
- Consumption Spending
- Investment Spending
- Government Spending
- Net Trade
Fundamental Factors
There are some fundamental factors which influence forex trading system. They are..
- Financial Factor is very crucial to the fundamental analysis. The changes of financial policies of certain country, export value, income, unemployment and so on will give a great impact on the country’s currency value.
- Interest Rate. The interest rate influences the currencies value that will also give impact on the credit’s interest, investor’s interest and so on.
- Political and Social Factor. The changes of political atmosphere, leader, cabinet, security level, and so on in a country will definitely influence the currency. The more stable a country, the better currency will be.
- Chaos/Earth-Quake. It is a factor that cannot always be predicted, and will give influence in a negative way.
