With its 4 trillion dollars traded each day, Forex is the largest financial market. Many times, you will have heard or read that because it is such a vast market, Forex cannot be manipulated. No statement could be more wrong.
If in the short-term it is speculation that moves the Forex market, in the medium to long-term it is the Central Banks, the largest manipulators of all, who predominantly move currencies. They are certainly not moved by overbought or oversold indicators, or even the crossing of moving averages.
If you aim to trade professionally with currencies, you need to understand the dynamics of Forex. You have to change the way you analyse a currency pair. Because trading with a currency pair is very different from trading with a stock or commodity; you have to see a currency pair not like a single market but as two opposing economies.
For example, you cannot see Eur-Usd as a single price. You have to divide the currency pair, analyse the economies of both countries and understand which of the two is stronger and is growing more than the other.
And at the end of your analysis, you have to buy strengths and sell weaknesses. This type of analysis also helps you to understand if a currency pair is at a correct exchange level, or whether there is a misalignment with economic values, which therefore opens trading opportunities.
By combining all these aspects with fundamental analysis, you will discover a new way of seeing Forex, and of analysing a currency pair. You will learn the dynamics that really move currencies.
You will also learn to trade only when the odds of success are on your side, thereby limiting risks. And not only that. In this way, your trading activity will also be stripped of its emotional component.
So, what do you want to do? Do you want to finally learn to trade Forex like a real fund manager, or do you want to continue using your own strategy?