Predicting price moves has always been a vital part of successful Forex trading. You cannot trade wisely of you don’t try to predict the price behavior prior to opening another trade and close it on time. As a rule, decent analytics can be obtained through comprehensive technical and fundamental analysis. Time-wise, you can distinguish between short-term, mid-term, and long-term forecasts.
Contemporary Forex Forecast.
When trading Forex or pretty much any other financial market out there, you can rely on either fundamental analysis or technical analysis… or you can combine both. You can find a lot of FX forecast on the Internet these days. Some of them are free, while others require a certain fee to be paid for them. However, everything boils down to the quality and reliability of those forecasts. Simply put, there are only 2 possible outcomes. The forecast either fails or doesn’t.
According to a senior Masterforex-V Academy member named ATEI, practice shows that most of those free forecasts you can find on the Internet are of poorer quality.
As for intraday trading, whether you make use of fundamental analysis, you still cannot do without technical analysis since it is impossible to predict short-term moves based on fundamentals alone. Fundamental analysis is a deeper one. It indicates the likely trend reversals, which cannot be diagnosed correctly and timely using tech analysis. That said, even though there are still advocates and adversaries of both approaches still arguing which one is the best, really savvy traders and investors keep on using both of them to their won benefit.
When it comes to any forecast for the forthcoming trading week, it should be mainly based on tech analysis, with elements of fundamental analysis, including expert expectations regarding the week’s most significant events affecting the market as well as your choice of trading strategy. That said, this holds true for short-term and mid-term trading.
As for the long-term one, everything reverses. Simply put, in this case it boils down to fundamental analysis with elements of tech analysis.
Expert on Precision and Importance of FX Forecasts
Market Leader interviewed ATEI asked him to share his own opinion on the matter:
For starters, what do you need FX forecasts for? An average rookie or even an intermediate trder would ask that FX forecast are needed to read them to open a trade, take profit and that’ it. At first, this is the way it is. However, most of those guys out there somehow forget that it is important to add the “think first” notion to the chain. If you use ready-made analytics thoughtlessly, without critical thinking, you become over-dependent on those analysts, which may let you down eventually.
Now I want to address rookies:
Dear would-be millionaires! If you want to survive in today’s financial markets, there is something you should know and keep in mind at all times:
The FX trader is a profession where you should use your own head rather than relying on others.
The FX trader is a profession that requires a lot of learning to be able to think and analyze everything on your own.
The FX trader is a profession where you make your own trading decisions and accept full responsibility form them once you have learned how to do it properly.
That doesn’t mean that you should avoid someone’s forecast like the plague. I mean you shouldn’t take any forecast for granted. Everything needs to be analyzed to find out what’s under the hood to each and every forecast you are trying to put to good use. Analytics is just a tool to help you save a lot of time and effort when trying to compile multiple bits of information into a single picture. Fore example, at our department within the scope of Masterforex-V Academy, we trade over 40 currency pairs. This is where analytics comes in handy. We exchange our analytics and forecast, take them through critical thinking.
We also make our own forecasts to help our students get started and explain how to read those forecasts properly. These forecast are of purely educational value. At our department, we do our best to prevent students from losing first and help them make money second. It is important to do it from day one.
Once again, our forecasts are some kind of an aid to rookies. Then we teach them how to use their own heads to analyze the market without having to relay on forecasts. Of course they can read the forecast if the want but they definitely don’t take them for granted. That’s a huge difference!
Finally, let’s consider an example. The forecast we are about to consider was given by ATEI on November 30th, 2015.
As you can see, everything is clear, with entry points and major levels of support and resistance.
Eventually, this forecast allowed the students to capture 500 points of profit! OK, that covers the basics. Next time we’ll try to dive deeper into the topic with more detailed example and we’ll talk about the true value of team work. Good trading! See you next time!
