What is forex Fundamental Analysis ?

Forex fundamental analysis involves evaluating the intrinsic value of a currency by examining related economic, financial, and geopolitical factors that might affect its value. It aims to understand the underlying forces that drive currency movements based on various indicators, such as:

Economic Indicators : This includes GDP growth rates, employment levels, inflation, interest rates, and trade balance data. These indicators help gauge a country's economic health, influencing its currency value.

Monetary Policy : Central banks and their policies, including decisions on interest rates, money supply, and quantitative easing, have a significant impact on currency valuation.

Geopolitical Events : Political stability, elections, geopolitical tensions, and international relations can affect a currency's value as well.

Market Sentiment : Investor perceptions, market expectations, and overall sentiment also play a role in currency movements.

Traders and analysts use fundamental analysis to anticipate potential changes in currency values and make informed trading decisions. It involves staying updated on news, reports, and economic data releases from various sources like government agencies, central banks, and financial news outlets.

Fundamental analysis is often complemented by technical analysis, which involves studying past market data (price and volume) to predict future price movements. Both methods are used by traders to form a comprehensive view of the market.

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