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dvid
May 28 2018 at 10:49
5 ieraksti
I mostly use technical analysis. Price action trading is all about that. Using technical analysis without fundamentals to identify trends on the charts.

emily_smith
Jun 03 2018 at 06:41
22 ieraksti
togr posted:
You cannot separate technical and fundamental analysis.
I suggest to focus on technical and use at least a bit of fundamental to avoid major economic news and counter trend trading.

Yes i agree with you. Technical and fundamentals both are inseparable.

mrtodd
Jun 03 2018 at 08:03
121 ieraksti
So many ways to trade and so many different personalities trying to trade. What works for one person may not work for another. I live off of technical analysis. The only use for fundamentals I have is when to avoid trading. I do not trade high impact economic reports and I tend to try and exit or hedge my positions when a high impact report is coming out. I look for trends for trade direction and I'm reluctant to trade in an exhausted trend and usually wait for confirmation of a trend change before I re-enter a particular market. But that's just my style and it will work for some people but not everyone. Our personal trading journey's lead us to experiment until we find something that works for us.

You've gotta be in it to win it.
SwapTrader
Jun 03 2018 at 10:06
24 ieraksti
maria_taylor posted:
togr posted:
You cannot separate technical and fundamental analysis.
I suggest to focus on technical and use at least a bit of fundamental to avoid major economic news and counter trend trading.

Exactly, only using both technical as well as fundamentals will result in profitable trades.


With respect, this is simply not true. The Forex market is random and rarely conforms to technical and/or fundamental analysis consistently.

darren (darrengreg)
Jun 05 2018 at 13:19
37 ieraksti
mrtodd posted:
So many ways to trade and so many different personalities trying to trade. What works for one person may not work for another. I live off of technical analysis. The only use for fundamentals I have is when to avoid trading. I do not trade high impact economic reports and I tend to try and exit or hedge my positions when a high impact report is coming out. I look for trends for trade direction and I'm reluctant to trade in an exhausted trend and usually wait for confirmation of a trend change before I re-enter a particular market. But that's just my style and it will work for some people but not everyone. Our personal trading journey's lead us to experiment until we find something that works for us.


I can very well relate to you. Even I use fundamentals only when I need to make a decision about not placing a trade. But otherwise I am a technical trader and plan my trade on the basis of chart patterns, indicators and trend lines. And I am happy to share it works for me majority of the times.

maria_taylor
Jun 06 2018 at 06:26
40 ieraksti
It is a subjective matter but I feel that to tame this random forex market and make the best out of it, technical and fundamental analysis is of considerable help, at least it is for me and many traders like me I guess.

SwapTrader
Jun 07 2018 at 06:29
24 ieraksti
maria_taylor posted:
It is a subjective matter but I feel that to tame this random forex market and make the best out of it, technical and fundamental analysis is of considerable help, at least it is for me and many traders like me I guess.


Let me clarify my point. Fundamental analysis is a forecast of what is likely to unfold into the future, based on a wide range of factors. Technical analysis looks at price action today to inform us about what is happening now. You can combine these two methods to gain insight into what is likely to happen next, and to time market entries and exits based on what is happening today. So from this perspective, I agree with you and others that technical and fundamental analysis ought to be combined.

But here's the problem. Technical and fundamental analysis evolved from the stockmarket, where all participants share a common cause...to invest for profit. This is simply not the case in the Forex market, where around 95% of its volume is derived from participants that could not care less about investment returns. For example, nearly half of daily Forex turnover represents foreign exchange swaps, the simultaneous purchase and sale of identical amounts of one currency for another with two different value dates, with the single aim of swapping interest rates. Another 19% is derived from international trade, tourism, and foreign aid transactions. In fact, spot currency transactions represent just one-third of the daily turnover, and the vast bulk of this is interbank activity. You and I, us retail traders, represent just 4%-5% of the daily turnover, and we are the only players seeking investment returns from speculative activities.

Effectively, a 1% fluctuation in the 95% group will translate into a 20% impact on the 5% group...us...with that impact having no relationship whatsoever with current technical or fundamental factors. In the long term, I agree that fundamentals will dictate the ultimate value of a currency, but can you sustain those 1% fluctuations along the way? If not, fundamental analysis may add no value to your strategy. Better to evaluate currency strength-weakness, and follow the money flow!

sarahlawrence
Jun 07 2018 at 13:43
20 ieraksti
Everyone has different ways of approaching trading. But I find both FA and TA to be very important for successful trading. Fundamental analysis will tell you about what is happening in the economy and markets whereas technical analysis helps in deciding the right entry and exit points in the trade. So, pay attention to both of them.

maria_taylor
Jun 07 2018 at 13:43
40 ieraksti
SwapTrader posted:
maria_taylor posted:
It is a subjective matter but I feel that to tame this random forex market and make the best out of it, technical and fundamental analysis is of considerable help, at least it is for me and many traders like me I guess.


Let me clarify my point. Fundamental analysis is a forecast of what is likely to unfold into the future, based on a wide range of factors. Technical analysis looks at price action today to inform us about what is happening now. You can combine these two methods to gain insight into what is likely to happen next, and to time market entries and exits based on what is happening today. So from this perspective, I agree with you and others that technical and fundamental analysis ought to be combined.

But here's the problem. Technical and fundamental analysis evolved from the stockmarket, where all participants share a common cause...to invest for profit. This is simply not the case in the Forex market, where around 95% of its volume is derived from participants that could not care less about investment returns. For example, nearly half of daily Forex turnover represents foreign exchange swaps, the simultaneous purchase and sale of identical amounts of one currency for another with two different value
dates, with the single aim of swapping interest rates. Another 19% is derived from international trade, tourism, and foreign aid transactions. In fact, spot currency transactions represent just one-third of the daily turnover, and the vast bulk of this is interbank activity. You and I, us retail traders, represent just 4%-5% of the daily turnover, and we are the only players seeking investment returns from speculative activities.

Effectively, a 1% fluctuation in the 95% group will translate into a 20% impact on the 5% group...us...with that impact having no relationship whatsoever with current technical or fundamental factors. In the long term, I agree that fundamentals will dictate the ultimate value of a currency, but can you sustain those 1% fluctuations along the way? If not, fundamental analysis may add no value to your strategy. Better to evaluate currency strength-weakness, and follow the money flow!


That’s quite an elaboration on the topic but I slightly disagree with you. Forex market is not that random market you think it is. The history defines the purpose for which it came into existence. The participants in FX markets care as much about investment returns and minimizing their risks. For reference, the international traders (crude, commodity, exporters & importers) have their roots into this market as they first hedge currency immediately after cracking the trade as they get settlement in spot market so they hedge in FX market.
And for the interbank activity, not only the retail traders, all the international trade deals are always happening through banks. Banks also hedge their risk in FX market and if you watch all fundamentals like economic data then you will get the clue of the directions looking at the trading activity.
 
Also the study about currency strength and weakness or money flow, all this can be identified through technical analysis first as it is a brief study of psychology of market participants supported by the fundamentals. Once fundamental news is out then technical strategies gets more momentum.

In forex market, Technicals comes first as it contains traders’ psychology and by traders I mean banks, importers, exporters and international banks who actually transact as you mentioned. Retail traders come here to make some profit but all those big shots come here for hedging their bulk currency deals. Most of the banks have special treasury departments for hedging the currency risk.

So I recommend that looking into technicals more closely in forex market, and backing it up by the fundamental news.

Adribaasmet
Jun 08 2018 at 07:59
897 ieraksti
sarahlawrence posted:
Everyone has different ways of approaching trading. But I find both FA and TA to be very important for successful trading. Fundamental analysis will tell you about what is happening in the economy and markets whereas technical analysis helps in deciding the right entry and exit points in the trade. So, pay attention to both of them.


Did you mean, FA for fundamental analysis & TA for technical analysis? Or anything else?

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