How Trade Forex with News (Fundamental Analysis)
fundamental analysis involves poring over economic data reports and news headlines. (And nowadays….random tweets from a certain world leader.)
Fundamental analysis is a way of looking at the forex market by analyzing economic, social, and political forces that may affect currency prices.
In other words, you have to look at different factors to determine whose economy is rockin’ like a Taylor Swift song, and whose economy sucks.
You have to understand the reasons why and how certain events like an increase in the unemployment rate affect a country’s economy and monetary policy which ultimately, affects the level of demand for its currency. The idea behind this type of analysis is that if a country’s current or future economic outlook is good, its currency should strengthen.
The better shape a country’s economy is, the more foreign businesses and investors will invest in that country. This results in the need to purchase that country’s currency to obtain those assets.
In a nutshell, this is what fundamental analysis is: GOOD ECONOMIC OR BAD ECONOMICS