By: Charley Warady
When it comes to trading the Forex market, it's not only about buying and selling and hoping that you're right. There is, in fact, a great deal to Forex market analysis that deserves any Forex trader's undivided attention on a daily basis.
It's important to have a game plan when trading Forex. Each and every day. Any seasoned trader will tell you that a thorough Forex market analysis is done before the first trade of the day. You need to get a lay of the land before you begin your day.
What is involved
A Forex market analysis includes everything from the fundamental analysis to the technical analysis. There may be reports coming out on any particular day. If the US Fed report is coming out, the trader might want to stay away from the market until the dust settles. If the unemployment report is coming out, that is going to have a major effect on which way the market is going to move.
It's not all about charts and lines. When fundamental news comes out, all the charts in the world could tell you that the market is going to do one thing, but it will react to the news in spite of the charts; not because of them. A Forex market analysis will alert you to anything that might come up.
Where to get it
Most brokers, on their websites, will offer some kind of Forex market analysis. Whether it's just a column on the home page, or different channels for different Forex pairs, they offer the opportunity for their traders to stay informed. Up to the minute news is made available and actually should be clicked on periodically throughout the day. It doesn't hurt to stay informed.
Forex portals and websites also give daily analysis. Not only will many of them provide the basic statistics and announcements, but many of them will offer an opinion and analyze the news that is provided. At the end of the day, it is each individual trader's decision on what to do with the information provided. But to have the information out there and not be utilized is like leaving a valuable tool lying on the table.
Blogs often give Forex market analysis. There are a few that do it on a daily basis, and some that will give weekly wrap ups. Take a look around and see which one appeals to you. A variety of formats may also prove useful.
What to do with it
To have a good technical analysis is always the basis of solid Forex trading. That's where you're going to find your trading range; your buying points; your selling points; and your stop loss points. It's going to show you where, technically, the support and resistance lines are in the Forex market. It is the foundation of your day trading.
However, the fundamentals can never be ignored because it can be the trap you don't want to fall into. To spend some time and get a good Forex market analysis can add substantial profits to any traders day. And isn't that what it's all about?