The name of the game in Forex trading is predicting the movements of the market. Whoever can answer the question “What will the EUR/USD do next?” is sure to make a nice bundle. The only way to really do this with accuracy is via Forex fundamental analysis A.K.A Forex news.
Putting aside the age old dilemma about Forex fundamental analysis vs technical analysis, no one debates the importance of watching Forex news and adjusting your trading accordingly.
At the end of the day, Forex news and Forex fundamental analysis is what drives the market. A war in one country or a political revolution in another is the kind of news that will have a direct impact on the Forex market and its future trends.
No one is saying that you should ignore technical analysis, the Forex charts will definitely help you in your trading but news and fundamental analysis are two tools you should focus your attention on when trading this market.
Most Forex brokers offer trading platforms with integrated news and Forex fundamental analysis, and if your broker does not, it might be time to move on.
The worst mistake a Forex trader can make is to trade Forex in an abyss. Forex is not a casino and if you do not have a technique including news and fundamental analysis, then you are making a fundamental mistake that will cost you big losses.
In addition, some might find reading the charts to be a little too technical and complex for them, but it is safe to say that anyone trading Forex can handle the task of reading the Forex news and fundamental analysis, They are usually written in simple language that is easy to understand and digest. What you do with the information you get in today’s news is another story completely.
Forex fundamental analysts can take one look at today’s news and conclude that the USD will rise or fall today against the Yen, something that requires training over an extended period of time. Having said that, a large part of fundamental analysis or analyzing the Forex news, is common sense that any person with no prior training can do, at least on a basic level.
In conclusion, trading Forex should be taken very seriously if you want to end up on top, and one of the first moves to make is to choose a broker who offers top notch integrated Forex fundamental analysis in the trading platform. It also helps to keep another window open, perhaps on CNN to stay updated on today’s Forex news.