Fundamental Analysis in Forex requires taking into account the economic indicators that can affect the country’s currency.
Since economic indicators reflect the economic state of a country, the price and the volume of a country’s currency is directly affected when there’s a significant change in the conditions reported.
Here are some useful tips when trading using fundamental analysis:
- Know when the indicators are due for release. There are economic calendars available online and on Central Banks website.
- Identify if the market expectations for the data is met, this is more important than the data itself.
- Understand what are the impacts of the data to the nation’s economy.
These economic indicators can be an invaluable resource when analyzed and used properly.