Fundamental analysis in Forex
In the last lesson we saw what the fundamental analysis consists of and we pointed out how this would permeate everyday life and how we can see its effects. In this lesson instead we will see specifically what are the factors that are taken into account in the fundamental analysis, which are the economic indicators of a given context. We consider it advisable to provide both the Italian and the English words, because those of you who addentrerà in the study could find some initial difficulties in the right translation of certain voices. Well, here are the most considered economic indicators for the fundamental analysis in Forex:
GDP or gross domestic product – GDP
Orders of durable goods – durable goods orders
Retail sales-Retail sales
Company stocks-Business inventories
Wholesalers ‘ Stocks – Wholesale Trade
Order to industry-Factory orders
Household incomes – Personal income
Consumption costs – PCE or personal Spending, personal consuptione Expenditure or personal Expenditure
Unemployment rate-unemployment rate
Interest rate or reference rate
As you can easily see, these are terms that are heard every day in the economic insights of the news, or that are very newsworthy in the opening. GDP data is certainly the most resonant, as is the unemployment rate and household income.
1 interest rates, crucial for currencies
2 The welfare of the economy
3 Euro against Dollar, the infinite Challenge
Interest rates, crucial for currencies
We have stressed several times that there are some important decisions that when they are announced influence and not just the trend of currency prices. One of the economic indicators to be considered for this is the interest rate. In fact, think of a conference where the President of the ECB or the FED announces the cut of interest rates. This type of announcement has always the immediate effects on the cross currency of reference so it is always good to take advantage of it, or close the positions that can become dangerous.
The welfare of the economy
All the economic indicators listed above go to play an important role on what we can define as the welfare of a given economy. An economy that presents positive assessments on all these factors is certainly a healthy economy. Now: it will be simple but not trivial to specify that so much an economy is well, it is solid, the more it will be well and be solid that currency. For this reason, we advise you to always keep as a reference and as a product to invest in, the US dollar. The United States is for sure the strongest and most stable economy in the world, with the potential always around the corner, fueled by a mobility character both in work and in the flow of investments.
Euro against the dollar, the Infinite Challenge
Since the euro, the EUR/USD has always been the most negotiated currency pair and the reasons are manifold. The most important is the relative ease compared to other couples, to predict its movements, especially the excessive ones, precisely related to the above announcements. This couple therefore looks great both to start and to continue a trading activity on Forex.