How to Use Fundamental Analysis?
Fundamental analysis refers to analyzes the macroeconomic conditions of the country to predict the basic trends and exchange rate changes based on the driving factors of market fluctuations. Generally, when a country’s economy strengthens, its currency exchange rate will rise, and when the economy goes down, the currency exchange rate will decrease. Because the US dollar is the world’s trade and settlement currency, the US dollar has an absolutely dominant position and advantage in the foreign exchange market. The economic condition of the United States is the main factor affecting the foreign exchange market. Therefore, Its economic data gets the most attention from forex investors. According to statistical analysis, the effect of different economic data on the market in order from strong to weak is: Interest rate resolution, unemployment data, GDP, industrial production, foreign trade, inflation rate, producer price index, consumer price index, wholesale price index, retail price index, purchasing managers’ index, consumer confidence index, business climate Indexes, construction data, factory orders, personal income, car sales, average wages, commercial inventory, leading economic index and more.