In Forex Trading, there are two main approaches – Fundamental Analysis and Technical Analysis. Fundamental analysts will concentrate on the underlying causes of price movements, whereas as technical chartist studies the actual price movement.

Fundamental analyst focus on various macroeconomic indicators – Interest Rate, Trade Balances, Growth Rates, and Unemployment rates, Gross Domestic Product (GDP), Inflation and etc. For beginners, do take note that there is no single set of rule to trade Forex using fundamental analysis. There are many theories on how a currency should be valued.

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Before, the forex market was limited only to long-term investors, banks and people who have greater capitals. The trading occurs via an agent or voice broker who will inform clients on what is going on. Later on, it was been replaced by a computerized automated systems. This was the early form of forex trading strategy.

The trader which is either home-based or office-based or retail investor can possibly trade on real time with different banks with an aid of a broker. The broker then uses the computerized platforms of trading. It contains traders on live desks which places the trades on the broker’s books or on real investors. However, when the trade was placed in the broker’s book, 95% of the money will be lost by the traders. So the brokers take this is an advantage on them.

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There are so many Forex trading strategies out there that it’s not surprising so many people don’t know where to start. But actually, all of those strategies are some combination of two different techniques: fundamental or technical analysis.

A fundamental analyst looks at a nation’s entire financial picture to guide her trades, studying international macroeconomics and the forces that drive the supply of and demand for a currency. There are five of these factors:

• is that country’s government in good financial shape or in the red, and what is their financial policy (pro-business, labor, etc.)

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