Knowing the fundamental analysis will allow you to know how to invest money. Knowing the technical indicators will help you identify which currency pairs are going to go up and which ones are going to go down. Currency Trading Principles
One of the first trading tools you should learn before going into the forex market is the fundamental knowledge of the Forex major currency pairs. I will be covering the two basic types of currency trading, fundamental and technical analysis.
Basically technical trading is using your knowledge of the Forex market to determine what type of currency pair is the most likely to go up in price at any given time. Using technical analysis and the clues you have about a given pair like a currency’s history, technical indicators, etc., you can determine whether or not it will go up. If you are trading technical analysis, your first step is to learn the basics of the market and to identify the fundamental currencies in the market.
Technical trading is based on technical analysis. There are many technical indicators that use mathematical algorithms to decide which currency pair is the most likely to go up in price. The major types of technical indicators are moving averages, moving averages overlays, RSI, technical indicators, and others. I will be focusing on the moving averages (MA) indicator in this article because it is the most popular one.
When a pair goes above or below a moving average, that pair becomes known as a “maverick move.” A maverick move happens when the currency pair moves above or below a particular moving average over a certain period of time. While the MA does provide some of the information for technical traders, most traders use their own judgment and use other indicators to determine whether a pair is a maverick move or not.
Moving averages, by themselves, do not tell you much about a pair. If you look at a single MA chart and use the trends line method to indicate price action, you will most likely get a good indication of what you think the market will do, but the actual value will not be determined by the MA indicator. You need to learn to trade with the moving averages as well as other technical indicators.
The most fundamental way to learn about a pair of currency pairs is to read through a technical report. Technical reports can be found at the website FOREX Signal and they can give you an idea of the most common price action patterns and trends that exist for a given pair.
After you have learned how to read technical charts, you can move on to the fundamental analysis. Fundamental analysis is looking at the fundamental currency pairs in the market.
One fundamental indicator that is used by many traders is the similarity index (SII). The similarity index is used to determine the amount of similarities between two currencies.
You can use the fundamental analysis to help you determine the future price of a pair. You can also use the fundamental analysis to make sure that you are only buying or selling a pair of currencies that are similar to the ones you are buying or selling.
Once you have learned how to use the fundamental analysis, you can begin to trade with the technical indicators to determine which of the fundamental currency pairs is most likely to go up in price. This may take some time to learn, but it is a very important aspect of forex trading.
Remember, the two basic types of currency trading are fundamental and technical, so before you start trading in the forex markets, you should take the time to learn both types of trading. Fundamental trading takes place in the forex markets, while technical trading takes place outside of the forex markets.