This page lets you decide on the approach that you take to trade in the market. Do you follow technical or fundamental analysis?
Those who have a mathematical aptitude should opt to do a chart analysis which basically is what the technical analysts do. The analysts here look at the change in the price in relation to what their historical averages are and then determine the trend and what will happen to the price in the future. The approach makes use of many indicators that are plotted using price action formulas and lets the traders determine when the price is overbought and when it is oversold. When the price is overbought then this means that the price has risen a lot and it could fall anytime now. When the price is oversold then this means that the prices have fallen a lot and it could start moving up anytime soon. If you think that this is the right way for you then you could learn technical analysis and apply it in your trading strategy.
Those of you who look at things with a perspective towards literature should trade using fundamental analysis. The Forex traders here assess the economic data releases and they watch the Central Bank interest rates closely to determine whether to go long or short on a particular currency. Any strength or any weakness is linked directly to the currency and this is how the trader opens a new position. Like for example, the GDP and the inflation are increasing and this could cause the central bank to increase the rate of interest. This makes the currency of that country bullish. If the jobs are being cut and the Central Bank is reducing the interest rate then this is bad for the currency of the country and one should be bearish on it. These are some events that are watched closely by the fundamental analysts and by analyzing these data they take a position in the Forex market.
Combining both the strategies
MostoftheForex traders use both the approaches to take trades in the Forex market. At times, this could cause confusion giving you conflicting information. The idea here is to use fundamental analysis to determine which currency pair should be bought or sold and then use technical analysis to find out the price points where the buy or sell order should be executed.