Fundamental analysis is an approach to analyzing the markets by taking into account factors such as the social, economic and political issues. These factors tend to influence the supply and demand of the security in the question.
Fundamental analysis is one of two ways to analyze the forex markets. The other approach is the more widely popular technical analysis.
Both fundamental and technical analyses are important when you want to study the markets. However, traders mostly ignore the fundamentals when trading currencies and focus only on the technical analysis.
The general argument is that day traders who only trade within a small time frame need not concern themselves with fundamentals. This is because fundamentals are what tend to impact longer-term trends.
However, regardless of whether you are day trading or swing trading, it is important to pay attention to the fundamental developments in the markets as well. You can actually expect to … Read the rest