Forex analysis is the bread and butter of any successful trader’s research, huge piece of the puzzle if you’re going to create real wealth from this investment vehicle.
Sure, plenty of people get lucky every now and again trading Forex pairs and playing the market with a real random approach – just sort of hoping that lady luck will shine on them every now and again.
But that’s no ticket to consistently beating the market, winning your trades, and learning from the decisions you make (good or bad) to make better, smarter, more profitable trades moving forward.
All that comes down to Forex analysis.
At the same time, there are three critical types of analysis you have to master if you’re going to have consistent success in the market today.
Fundamental analysis is the first piece of the puzzle.
Take advantage of by all of the major traders (including institutional money), the fundamental analysis you’ll find on the Forex markets these days revolve around interest rates, GDP numbers, and other bits and pieces of economic data regarding the currencies you’re looking to move.
Fundamental analysis is so much more than just looking at the news to see which way the wind is blowing, though.
You want to make sure that you were keeping your finger on the pulse of each currency pair your thinking about trading, checking to see what the sentiment is like around the world, and regularly updating your fundamental analysis so that you don’t get caught making moves based off of “cold info”.
Technical analysis, on the other hand, is where the overwhelming majority of people focus when they first get into Forex trading.
This is the kind of Forex analysis that revolves around looking at charts, looking for technical indicators, looking at Forex signals, and other bits and pieces of “hard data” that track how Forex moves every day the market is open.
A lot of this kind of analysis is automated now and much more accessible to newbies they are not ever before.
That doesn’t mean that you shouldn’t learn how to do manual technical analysis on your own, though.
This kind of skill will let you double check all the information you’re getting from third-party sources, helping you confirm this data with your own trading disciplines so that you know it’s the right info to move forward with.
Weekend Breakdowns and Reviews
The third bit of Forex analysis you’re going to want to do has everything to do with analyzing your own trades, looking back at the moves you made in the decisions that led you to them, as well as planning how you are going to move forward.
Far too many people ignore this bit of Forex analysis completely, never looking back at the trades they’ve already made (and the ones that want to make in the future) to learn from their actual experience.
Don’t make that same mistake.
Weekend breakdowns and reviews will make you a much Forex investor (faster, too) than maybe anything else.