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Fundamental Analysis is simply the process of identifying and understanding the ''"factual reasons"'' why the market is moving in the direction that it is currently moving within the overall trend. This is in contrast to simply identifying that a trend or price move has already happened. Identifying that a market has already had a price move is the job of [[Technical Analysis]] which is all backward-looking. Understanding why a particular currency or market is moving is the job of fundamental analysis which is forward-looking and allows you to use this information to try and predict where prices might go in the near future. | Fundamental Analysis is simply the [[Developing_your_Trading_Process | process]] of identifying and understanding the ''"factual reasons"'' why the market is moving in the direction that it is currently moving within the overall trend. This is in contrast to simply identifying that a trend or [[Price_Action_Analysis | price move]] has already happened. Identifying that a market has already had a [[Price_Action_Analysis | price move]] is the job of [[Technical Analysis]] which is all backward-looking. Understanding why a particular [[currency]] or market is moving is the job of fundamental analysis which is forward-looking and allows you to use this information to try and predict where [[Price_Action_Analysis | prices]] might go in the near future. | ||
Fundamental Analysis is an extremely underserved subject when it comes to retail traders and how they obtain their [[trading]] [[Trading_Routine#Knowledge_Phase | knowledge]]. In this Wiki, we will explore all the various aspects of fundamental analysis and how you can apply that to your own [[trading]] for improved performance. | |||
This Wiki is a part of our [[Essential Forex Trading Guide]]. Be sure to check that out [[Essential_Forex_Trading_Guide | HERE]]. | |||
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==''' | =='''[[The Basics of Fundamental Analysis]]'''== | ||
Fundamental Analysis goes far beyond a simple [[Technical Analysis]] approach which is what the typical retail trader will use to make their [[trading]] decisions. Understanding Fundamental Analysis will give you more conviction because you can have confidence that ''you are [[trading]] the real reasons why the market is moving'' rather than simply guessing by using some variation of chart pattern or indicator to make your [[trading]] decisions. In this Wiki, we will explore [[The Basics of Fundamental Analysis]] including: | |||
* [[The_Basics_of_Fundamental_Analysis#The_Basics_of_Fundamental_Analysis | The Basics of Fundamental Analysis]] | |||
* [[The_Basics_of_Fundamental_Analysis#Fundamental_Analysis_and_Real_Life_Scenarios | Fundamental Analysis and Real Life Scenarios]] | |||
* [[The_Basics_of_Fundamental_Analysis#A_Trader's_Personal_Story_on_Fundamentals | A Trader's Personal Story on Fundamentals]] | |||
You can access the main Wiki for [[The Basics of Fundamental Analysis]] [[The Basics of Fundamental Analysis | HERE]]. | |||
=='''[[Objections to Fundamental Analysis]]'''== | |||
There are many ''Traders'' that are opposed to the concept of [[Fundamental Analysis]]. There are various reasons for this but what we will do in this Wiki is point out a few of the most popular objections and then provide some context on why they may not be well-founded objections including: | |||
* [[Objections_to_Fundamental_Analysis#Objections_to_Fundamental_Analysis | Objections to Fundamental Analysis]] | |||
* [[Objections_to_Fundamental_Analysis#Objection_#1:_Applying_the_Fundamentals_is_Unnecessary_Because_You_Only_Need_to_Look_at_the_Charts | Objection #1: Applying the Fundamentals is Unnecessary Because you Only Need to Look at the Charts]] | |||
* [[Objections_to_Fundamental_Analysis#Objection_#2:_Fundamentals_are_too_Difficult_Unless_you_have_a_High-Level_University_Degree | Objection #2: Fundamentals are too Difficult Unless you have a High-Level University Degree]] | |||
* [[Objections_to_Fundamental_Analysis#Objection_#_3:_All_News_is_Priced_into_the_Markets | Objection # 3: All News is Priced into the Markets]] | |||
You can access the main Wiki for [[Objections to Fundamental Analysis]] [[Objections to Fundamental Analysis | HERE]]. | |||
=='''[[Institutional and Retail Traders]]'''== | |||
There is a big difference in the way that a [[Institutional_and_Retail_Traders#What_is_a_Retail_Trader? | retail trader]] approaches the [[Forex]] or any other financial market from how a professional [[Institutional_and_Retail_Traders | institutional trader]] will go about navigating them. In the following Wiki, we will explore concepts such as: | |||
* [[Institutional_and_Retail_Traders#What_is_a_Retail_Trader? | What is a Retail Trader?]] | |||
* [[Institutional_and_Retail_Traders#What_is_an_Institutional_Trader? | What is an Institutional Trader?]] | |||
* [[Institutional_and_Retail_Traders#What_is_the_difference_between_Institutional_and_Retail_Traders? | What is the difference between Institutional and Retail Traders?]] | |||
* [[Institutional_and_Retail_Traders#Why_should_Traders_learn_the_Institutional_Way_of_Trading? | Why should Traders learn the Institutional Way of Trading?]] | |||
You can access the main Wiki for [[Institutional and Retail Traders]] [[Institutional_and_Retail_Traders | HERE]]. | |||
=='''[[Fundamental Supply and Demand]]'''== | |||
When discussing fundamental analysis there are some core principles that we need to be aware of. [[Supply_and_Demand | Supply and demand]] are at the heart of fundamental moves in all markets including [[Forex]]. In the following Wiki we will explore: | |||
* [[Fundamental_Supply_and_Demand#Fundamental_Supply_and_Demand | Fundamental Supply and Demand]] | |||
* [[Fundamental_Supply_and_Demand#Demand | Demand]] | |||
* [[Fundamental_Supply_and_Demand#Supply | Supply]] | |||
* [[Fundamental_Supply_and_Demand#Equilibrium | Equilibrium]] | |||
You can access the main Wiki for [[Fundamental Supply and Demand]] [[Fundamental Supply and Demand | HERE]]. | |||
=='''[[Sentiment Analysis Overview from a Fundamental Perspective]]'''== | |||
Fundamental Analysis and Sentiment Analysis are two of the most important subjects in Forex trading. In this Wiki, we will take a [[Sentiment Analysis Overview from a Fundamental Perspective]] and explore some ways to trade them including: | |||
* [[Sentiment_Analysis_Overview_from_a_Fundamental_Perspective#The_Best_Trades | Sentiment Analysis Overview from a Fundamental Perspective]] | |||
* [[Sentiment_Analysis_Overview_from_a_Fundamental_Perspective#The_Best_Trades | The Best Trades]] | |||
* [[Sentiment_Analysis_Overview_from_a_Fundamental_Perspective#Good_Trades | Good Trades]] | |||
You can access the main Wiki for [[Sentiment Analysis Overview from a Fundamental Perspective]] [[Sentiment Analysis Overview from a Fundamental Perspective | HERE]]. | |||
=='''[[Exchange rates | Exchange Rates]]'''== | |||
[[Exchange rates]] are an important aspect of understanding the full spectrum of fundamental analysis which is why we created a separate Wiki devoted entirely to [[Exchange rates]]. In the following Wiki, we will explore: | |||
* [[Exchange_rates#What_is_an_Exchange_Rate? | What an Exchange Rate is]] | |||
* [[Exchange_rates#Exchange_Rate_Examples | Exchange Rate Examples]] | |||
* [[Exchange_rates#The_Technical_Aspects_of_Exchange_Rates | The Technical Aspects of Exchange Rates]] | |||
* [[Exchange_rates#Exchange_Rate_Pricing_Theories | Exchange Rate Pricing Theories]]. | |||
* [[Exchange_rates#Central_Banks_and_Exchange_Rates | Central Banks and Exchange Rates]] | |||
The main page for [[Exchange rates]] is found here: [[Exchange rates]] | |||
=='''Money Supply'''== | |||
We have a separate Wiki on [[Central_banks#Monetary_Policy_and_Money_Supply | Money Supply]] so please click on the links to take you to those specific Wikis to obtain this information. | |||
The main page for [[Central_banks#Monetary_Policy_and_Money_Supply | Money Supply]] is found here: [[Central_banks#Monetary_Policy_and_Money_Supply | Money Supply]]. | |||
=='''[[Intermaket Analysis]]'''== | |||
To get a good grip on financial [[trading]] we need to take a few minutes out to look at something called ''"Intermarket Analysis"'' and how various asset classes and markets relate to each other. In the following Wiki on [[Intermaket Analysis]] we will cover subjects such as: | |||
* [[Intermaket_Analysis#Overview_of_Intermarket_Analysis | Overview of Intermarket Analysis]] | |||
* [[Intermaket_Analysis#The_Link_between_Bonds_and_Stocks | Links between Bonds and Stocks]] | |||
* [[Intermaket_Analysis#The_Link_between_Commodities_and_Bonds | Links between Commodities and Bonds]] | |||
* [[Intermaket_Analysis#Deflation_and_its_Effects | Deflation and its Effects]] | |||
The main Wiki on [[Intermaket Analysis]] can be found [[Intermaket_Analysis | HERE]]. | |||
='''Advanced Fundamental Analysis'''= | |||
=='''[[Fundamentals and Sentiment]]'''== | |||
In the following Wiki, we will explore what both fundamentals and sentiment are and build and expand on previous information from our [[Fundamental Analysis]] Wiki. | |||
You can access the main Wiki for [[Fundamentals and Sentiment]] [[Fundamentals and Sentiment | HERE]]. | |||
=='''Central Banks'''== | |||
[[Central_banks | Central Banks]] are so important to the [[Forex]] market and all other financial markets that we have devoted an entire in-depth Wiki to all things [[Central_banks | Central Banks]]. In the following Wiki on [[Central banks | Central Banks]] we will explore: | |||
* [[Central_banks#Introduction_to_Central_Banks | Introduction to Central Banks]] | |||
* [[Central_banks#A_Brief_History_of_Central_Banks | A Brief History of Central Banks]] | |||
* [[Central_banks#Central_Banks_and_Interest_Rates | Central Banks and Interest Rates]] | |||
* [[Central_banks#Overview_of_what_Central_Banks_do | Overview of what Central Banks do]] | |||
* [[Central_banks#Monetary_Policy_and_Money_Supply | Monetary Policy and Money Supply]] | |||
* [[Central_banks#Central_Bank_Monetary_Policy_Tools | Central Bank Monetary Policy Tools]] | |||
* [[Central_banks#Hawks_and_Doves | Hawks and Doves]] | |||
* [[Central_banks#Major_Central_Banks | Major Central Banks]] | |||
The main Wiki page for [[Central banks | Central Banks]] is found here: [[Central banks | Central Banks]] | |||
=='''[[Economic data releases | Economic Data Releases]]'''== | |||
Just like [[Central_banks | Central Banks]], [[Economic data releases | Economic Data Releases]] are so important to all financial markets that we have created a separate Wiki for them. In the following Wiki we will explore: | |||
* [[Economic_data_releases#Economic_Data_Primer | Economic Data Primer]] | |||
* [[Economic_data_releases#The_Importance_of_Globalization | The Importance of Globalization]] | |||
* [[Economic_data_releases#How_to_know_when_Economic_Data_is_Released | How to know when Economic Data is Released]] | |||
* [[Economic_data_releases#What_Traders_Need_to_Know_about_Economic_Data | What Traders Need to Know about Economic Data]] | |||
* [[Economic_data_releases#The_Expectations_of_Data_is_Critically_Important | The Expectations of Data is Critically Important]] | |||
* [[Economic_data_releases#Economic_Data_and_Economic_Cycles | Economic Data and Economic Cycles]] | |||
* [[Economic_data_releases#Economic_Data_Types | Economic Data Types]] | |||
* [[Economic_data_releases#Specific_Economic_Indicators | Specific Economic Indicators]] | |||
* [[Economic_data_releases#Economic_Indicator_Pre-Trade_Considerations | Economic Indicator Pre-Trade Considerations]] | |||
The main Wiki page for [[Economic data releases | Economic Data Releases]] is found here: [[Economic data releases | Economic Data Releases]] | |||
=='''[[How the Forex Market Relates to other Markets]]'''== | |||
The Forex market relates to other financial markets in various ways. In this Wiki, we will explore how different markets relate to and affect the [[Forex]] market including: | |||
* [[How_the_Forex_Market_Relates_to_other_Markets#Bonds | Bonds]] | |||
* [[How_the_Forex_Market_Relates_to_other_Markets#Commodities | Commodities]] | |||
* [[How_the_Forex_Market_Relates_to_other_Markets#Equities | Equities]] | |||
You can access the main Wiki for [[How the Forex Market Relates to other Markets]] [[How the Forex Market Relates to other Markets | HERE]]. | |||
=='''[[Economic Cycles]]'''== | |||
[[Economic Cycles]] are such an important and vast subject that we have a separate Wiki dedicated to all things on [[Economic Cycles]]. In the following Wiki on [[Economic Cycles]] we will explore: | |||
* [[Economic_Cycles#State_of_the_Economy | State of the Economy]] | |||
* [[Economic_Cycles#Inflation,_Deflation_and_Hyperinflation | Inflation, Deflation and Hyperinflation]] | |||
* [[Economic_Cycles#Economic_Cycles_and_the_4_Phases | Economic Cycles and the 4 Phases]] | |||
* [[Economic_Cycles#Economic_Data_and_Economic_Cycles | Economic Data and Economic Cycles]] | |||
* [[Economic_Cycles#Indicators_within_the_Economic_Cycle | Indicators within the Economic Cycle]] | |||
Please refer to the Wiki for further information on [[Economic Cycles]]. | |||
==Related Wikis== | |||
Readers of '''Fundamental Analysis''' also viewed: | |||
* [[Fundamental and Sentiment Trading Strategies]] | |||
* [[Sentiment Analysis]] | |||
* [[Risk Management]] | |||
* [[Central banks]] | |||
* [[Monetary Policy Tools]] |
Latest revision as of 12:27, 23 November 2023
Fundamental Analysis is simply the process of identifying and understanding the "factual reasons" why the market is moving in the direction that it is currently moving within the overall trend. This is in contrast to simply identifying that a trend or price move has already happened. Identifying that a market has already had a price move is the job of Technical Analysis which is all backward-looking. Understanding why a particular currency or market is moving is the job of fundamental analysis which is forward-looking and allows you to use this information to try and predict where prices might go in the near future.
Fundamental Analysis is an extremely underserved subject when it comes to retail traders and how they obtain their trading knowledge. In this Wiki, we will explore all the various aspects of fundamental analysis and how you can apply that to your own trading for improved performance.
This Wiki is a part of our Essential Forex Trading Guide. Be sure to check that out HERE.
Introduction to Fundamental Analysis
The Basics of Fundamental Analysis
Fundamental Analysis goes far beyond a simple Technical Analysis approach which is what the typical retail trader will use to make their trading decisions. Understanding Fundamental Analysis will give you more conviction because you can have confidence that you are trading the real reasons why the market is moving rather than simply guessing by using some variation of chart pattern or indicator to make your trading decisions. In this Wiki, we will explore The Basics of Fundamental Analysis including:
- The Basics of Fundamental Analysis
- Fundamental Analysis and Real Life Scenarios
- A Trader's Personal Story on Fundamentals
You can access the main Wiki for The Basics of Fundamental Analysis HERE.
Objections to Fundamental Analysis
There are many Traders that are opposed to the concept of Fundamental Analysis. There are various reasons for this but what we will do in this Wiki is point out a few of the most popular objections and then provide some context on why they may not be well-founded objections including:
- Objections to Fundamental Analysis
- Objection #1: Applying the Fundamentals is Unnecessary Because you Only Need to Look at the Charts
- Objection #2: Fundamentals are too Difficult Unless you have a High-Level University Degree
- Objection # 3: All News is Priced into the Markets
You can access the main Wiki for Objections to Fundamental Analysis HERE.
Institutional and Retail Traders
There is a big difference in the way that a retail trader approaches the Forex or any other financial market from how a professional institutional trader will go about navigating them. In the following Wiki, we will explore concepts such as:
- What is a Retail Trader?
- What is an Institutional Trader?
- What is the difference between Institutional and Retail Traders?
- Why should Traders learn the Institutional Way of Trading?
You can access the main Wiki for Institutional and Retail Traders HERE.
Fundamental Supply and Demand
When discussing fundamental analysis there are some core principles that we need to be aware of. Supply and demand are at the heart of fundamental moves in all markets including Forex. In the following Wiki we will explore:
You can access the main Wiki for Fundamental Supply and Demand HERE.
Sentiment Analysis Overview from a Fundamental Perspective
Fundamental Analysis and Sentiment Analysis are two of the most important subjects in Forex trading. In this Wiki, we will take a Sentiment Analysis Overview from a Fundamental Perspective and explore some ways to trade them including:
You can access the main Wiki for Sentiment Analysis Overview from a Fundamental Perspective HERE.
Exchange Rates
Exchange rates are an important aspect of understanding the full spectrum of fundamental analysis which is why we created a separate Wiki devoted entirely to Exchange rates. In the following Wiki, we will explore:
- What an Exchange Rate is
- Exchange Rate Examples
- The Technical Aspects of Exchange Rates
- Exchange Rate Pricing Theories.
- Central Banks and Exchange Rates
The main page for Exchange rates is found here: Exchange rates
Money Supply
We have a separate Wiki on Money Supply so please click on the links to take you to those specific Wikis to obtain this information.
The main page for Money Supply is found here: Money Supply.
Intermaket Analysis
To get a good grip on financial trading we need to take a few minutes out to look at something called "Intermarket Analysis" and how various asset classes and markets relate to each other. In the following Wiki on Intermaket Analysis we will cover subjects such as:
- Overview of Intermarket Analysis
- Links between Bonds and Stocks
- Links between Commodities and Bonds
- Deflation and its Effects
The main Wiki on Intermaket Analysis can be found HERE.
Advanced Fundamental Analysis
Fundamentals and Sentiment
In the following Wiki, we will explore what both fundamentals and sentiment are and build and expand on previous information from our Fundamental Analysis Wiki.
You can access the main Wiki for Fundamentals and Sentiment HERE.
Central Banks
Central Banks are so important to the Forex market and all other financial markets that we have devoted an entire in-depth Wiki to all things Central Banks. In the following Wiki on Central Banks we will explore:
- Introduction to Central Banks
- A Brief History of Central Banks
- Central Banks and Interest Rates
- Overview of what Central Banks do
- Monetary Policy and Money Supply
- Central Bank Monetary Policy Tools
- Hawks and Doves
- Major Central Banks
The main Wiki page for Central Banks is found here: Central Banks
Economic Data Releases
Just like Central Banks, Economic Data Releases are so important to all financial markets that we have created a separate Wiki for them. In the following Wiki we will explore:
- Economic Data Primer
- The Importance of Globalization
- How to know when Economic Data is Released
- What Traders Need to Know about Economic Data
- The Expectations of Data is Critically Important
- Economic Data and Economic Cycles
- Economic Data Types
- Specific Economic Indicators
- Economic Indicator Pre-Trade Considerations
The main Wiki page for Economic Data Releases is found here: Economic Data Releases
How the Forex Market Relates to other Markets
The Forex market relates to other financial markets in various ways. In this Wiki, we will explore how different markets relate to and affect the Forex market including:
You can access the main Wiki for How the Forex Market Relates to other Markets HERE.
Economic Cycles
Economic Cycles are such an important and vast subject that we have a separate Wiki dedicated to all things on Economic Cycles. In the following Wiki on Economic Cycles we will explore:
- State of the Economy
- Inflation, Deflation and Hyperinflation
- Economic Cycles and the 4 Phases
- Economic Data and Economic Cycles
- Indicators within the Economic Cycle
Please refer to the Wiki for further information on Economic Cycles.
Related Wikis
Readers of Fundamental Analysis also viewed: