FOREX ANALYSIS METHODS

FOREIGN EXCHANGE IN INDIA: ANALYSIS METHODS

As Forex trading is a business based not only on your professional knowledge and experience but also on luck, no one can guarantee that the position you opened would always work in your favor. Taking into consideration the fact that Foreign exchange in India is gradually becoming more and more popular, I would provide you with some very important Forex analysis methods. Three types of Forex market analysis

 - fundamental, technical and sentiment are distinguished to foresee in what direction the financial market would move. To decide which of them is the best one will be a wrong approach. If you want to become a consistent trader of Forex in India, you will need to use the unity of all three analysis methods.

Fundamental analysis

Fundamental analysis is based on economic, financial and political issues. The capacity to do a fundamental analysis requires regular following of the news. In theory it is enough to use only this analysis type, still in practice fundamental analysis is usually combined with the technical one.

Technical analysis    

Technical analysis is the examination of the previous price movements, the objective of which is to forecast the future price movements. Like weather forecast, technical analysis is somewhat indefinite, based on predictions. It uses a variety of charts that show the price over time.

Sentiment analysis

The word “sentiment” itself refers to that this analysis type is based on trading psychology. Its theory is the following: if the crowd is leaning in one direction, the sentiment analyst does not join the masses and acts contrary to the trends.