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    Thread: [Overview] How to predict price movements in the Forex market.

    1. #1
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      Default [Overview] How to predict price movements in the Forex market.

      What is the key to success? Each trader and investor asks themselves such a question and looks for an answer.
      The main thing in the Forex market is the ability to predict the price movements and make a profit in the market. How to predict these movements? Using what tools? Is it possible to learn to predict?
      If you struggle for a long time, you will get a result.
      To become a successful trader you need to understand: in the Forex market, a trader must learn to recognize and understand the factors that may affect the currency price change.
      How to predict this movement and get profit at the same time?
      There are some rules. You must watch for things like economic growth in the world, geopolitics and political stability, monetary policy, import/export, interest rates and so on.

      If you painstakingly follow all the events of the micro and macro economies, you have a much higher chance of success in your forecasts. But it is not easy, especially at the very start in such thing as trading.

      1) You must learn to recognize the trend.
      This is exactly what is useful when forecasting on the Forex market, since the trend or general direction of the market price is important when opening and closing positions.
      Depending on duration, trends can be classified into short-term trends, medium-term trends or long-term trends. If the general trend of the Forex market is moving up, you must be careful and attentive when making decisions based on a trend that goes in a completely opposite direction. The trend can also be applied to interest rates, stocks, indices and any other market that may be characterized by volume or price movement.

      2) You need to recognize the three main types of trend. They are uptrends, downtrends and sideways trends.
      If the trend moves upwards relative to the chart, then the currency price rises and vice versa with the downtrend.

      Types of the Forex market analysis.
      In fact, there are many methods of analyzing the Forex market.
      Analysis is done in order to identify the best trading opportunities for taking profits from the market.

      Fundamental analysis.
      It is based on fundamental factors, such as gross domestic product, inflation, economic growth and production. Therefore, it is necessary to study the economy of different countries in order to have complete information about the impact of geopolitical and economic events on the market.
      How to predict the market? Economists have created an economic calendar, where you can see daily forecasts for various economic events with all the data included.
      Usually, the data is dedicated to interest rates, employment situation, budgets, trade balances, treasury budgets, GDP and so on.

      If a country raises its interest rate, then its national currency becomes strongerĢ Then investors put their assets into the country in order to get high profits.

      Rising unemployment is a sign of weak economic growth, which ultimately can lead to lower interest rates. This can negatively affect its currency. A country with a significant trade deficit is likely to have a weak currency. GDP is the main indicator of the economic activity strength. There is a link between the high GDP and expectations of higher interest rates, which refers to positive factors for the chosen currency.

      How can a trader use all of the above to predict the market movement? First, always save the economic calendar. You also need to know which indicator of the forecast draws the most attention, because it will eventually become a catalyst for future price movements in the Forex market. And finally, pay attention to the news changes - the market situation may change very rapidly.

      Technical analysis
      The technical analysis is used to determine the price behavior in the future based on historical data. The idea is that the story can be repeated. In turn, these patterns, caused by movement in price, are called signals. The technical analysis purpose is to identify the current signals by checking past signals in the Forex market. This can help traders make daily Forex forecasts. In addition, prices are moving along trends. Technical analysts tend to believe that price fluctuations are not random. Once a certain type of trend has been formed, it will remain for a certain period of time.

      Forex traders can use volume charts, price charts, and other mathematical representations of market data (hereinafter referred to as studies) to locate the perfect entry and exit points. This is what can help a trader to learn how to predict the changes in the Forex market.

      Some of these studies help identify a trend, while others help determine the strength and stability of this trend over time. Technical analysis can increase discipline and reduce the influence of emotions in your trading plan. It can be quite difficult to track down fundamental influences and stick to entry and exit points according to your plan. Despite the fact that the system is not perfect, technical analysis gives you everything you need for daily analysis and Forex forecasting, and allows you to more objectively evaluate your trading plan.

      Now is the time to determine the technical types of indicators. The first one is trend. These indicators provide smooth price data, so that a constant upward, downward or sideways trend can be seen without extra effort. The second indicator is trend strength. This type of indicator characterizes the intensity of the market at a certain price, studying positions in the foreign exchange market, taken by different market participants. The base of this indicators is volume or open interest. The next indicator is volatility, which refers to the magnitude of daily price fluctuations. Despite the trend direction, changes in volatility are expected to be equal to price changes. Then we have cycle indicators. They identify recurring patterns in the Forex market from recurring events, such as elections. The cycle forecast indicator determines the moment of a particular Forex market model. Resistance and support are equally important indicators. They describe price levels, where markets often rise or fall. Finally, the last indicator is momentum. These indicators determine whether a trend will be strong or weak after it progresses over a certain period of time. The impulse is the highest at the start of the trend and the lowest when it changes.


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      Default Re: How to predict price movements in the Forex market?

      How to predict price movements?

      This depends on, among other factors, an instrument itself. Let's consider each group of instruments available for trading:
      1. Currency
      2. Shares
      3. Commodities

      CURRENCY

      The most popular method of analyzing currency pairs is technical analysis. Over the past hundred years since the introduction of stock trading, so many methods of analysis have accumulated that even an experienced statistician cannot list them all, because new methods appear as quickly as professional traders are born. After all, everyone has their own ideas.

      The most common methods of technical analysis include the analysis based on technical indicators; the analysis based on the Fibonacci levels; graphic shapes (patterns), and many others. The application of the full range of methods often gives multidirectional signals, so you should take the minimum and go deep into a particular method.



      There is also an analysis method based on the study of fundamental data. This applies not only to the currency, but also to other groups of instruments, but we'll talk about them later.
      First of all, this is, of course, the economic calendar where you can obtain information on the upcoming publication of specific data.

      Various global financial institutions regularly release public use materials that greatly facilitate trading. Basically, these materials affect the positions of major players operating with the help of a variety of financial instruments. This method will not help speculators in intraday trading, but it will be very useful to the medium-term traders.

      SHARES

      The same methods of technical analysis are appropriate not only for the currency and the entire financial market, but for the stock market. This is because the price chart and the principle of its creation are the same everywhere, and therefore it is equally useful to consider it using all the technical capabilities of the platform.

      There are only some differences in the fundamental analysis. You can not find any information on a specific stock in the economic calendar. It is worth taking a certain stock of a certain company, examining the prospects for growth, development or, on the contrary, regress, and drawing conclusions on the basis of the obtained data, then building a working strategy. Of course, on the Web, you may find a lot of sources that conduct this analysis for you, but in this case, you take all the risks. Anyway, you take the risks.


      COMMODITIES

      As mentioned above, we can apply technical analysis to all instruments that include japanese candlesticks, bars, and other graphic pricing methods.

      But in terms of fundamental analysis on commodity instruments, there are some differences.
      In the economic calendar, you will not find any statistics on these instruments. Political news should be considered. Commodities is a resource. Many countries export and import resources. Exports, imports, and the volume of supply to the regions of the world - all this affects the market price of the commodity exchange instrument.

      Thus, it is possible to predict anything in the financial markets, the most important thing is to find an appropriate approach to various instruments, on the future price of which you want to bet. And it is essential to bear in mind that a broker is not responsible for your trading decisions, and the risk from the results of your own analysis lies ultimately with you. And you are entirely responsible for the financial rewards in the form of positive results of your analysis.


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      Default Re: How to predict price movements in the Forex market?

      I see That Technical analysis is one of the best ways which can make us Predict Price Movements In the Forex Market Because based on it we can know the trend and the expected Movements for the next Periods By the Following Tools :

      1- The Indicators : which can show us the Trend of the market as moving average Indicators because having the price under it means that we are in Downtrend and having the Price above it means that we are in Uptrend So it can help us too much in knowing the Trend of the market beside some other indicators which can help us too much in knowing The oversold or over bought in the market as stochastic indicator and also other indicators can inform us by the strength of the Trend as RSI And Momentum indicators ..... etc .
      2- The Lines : and it is the lines which we can Draw it on the chart to make our technical analysis By more accurately Such as Resistance lines which can show us the best places which we can make a sell trade from it while having Downtrend and The support lines which can show us the best places on the chart which we can make a buy trade From it While having Uptrend and also we can Draw the trend lines on the chart which can inform us by the main trend and the secondary trend and every thing in the direction of the Pair .

      So i see that technical analysis is the best way which we can use it To predict by the price movements In Forex market But it need From us to be careful while the Important news because it may Make the market move suddenly against us so we have to avoid the trading while the important news if we depend only on technical analysis and this mean that we have to be aware with the fundamental analysis To avoid the trading while the time which may have big volatility in the market while the important news which we can Know its times From the economic calendar From the following link https://www.mt5.com/forex_calendar .


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      Default Re: How to predict price movements in the Forex market?

      dear forex trading members there are lot of ways to predict trading price movement first of all

      i) technical analysis
      ii) fundamental analysis
      iii) market sentiments
      in technical analysis you can use indicators oscillators and forex trading Japaneses candlestick chart which is very famous and 90% traders use candlestick chart pattern view current and previous history of forex trading chart than use indicators fibonacci retracement levels they help youto predict market levels for openning a trade close of trade and also forex reversal of market

      use bollinger band for market trading entry and exit so that you should know the market strong behavior

      use trend lines to predict market price movement follow the trend and trade with management


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      Default Re: How to predict price movements in the Forex market?

      There are three basic techniques which are used to predict the market,

      Technical analysis: Trader use indicators and other technical methods like price action or volume spread analysis to predict the market movement and become sure about the direction of the market, Basically, momentum indicators are used for this purpose those are very helpful in finding the direction of the market when used in combination fo one another. On the other hand price action is also a widely used choice in the market where traders use patterns along with support and resistance lines to get an expected direction of the market.

      Fundamental analysis: Trader account in all the fundamental release along with political issues to predict the direction of the market, economic indicators are used with their historical data to make the move clear.

      Market sentiment: Risk associated with the currency and current policies and events are used to get a direction like when a trader see risk in a wide scenario there he cash his investments from risky currency and invests in some safely considered currency.

      For the better results traders use Fundamental analysis along with technicals while risk sentiment is the least considered thing.

      I Trade Structures, not Noise.


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      Default Re: How to predict price movements in the Forex market?

      There are several ways to predict the price movement in the forex market, and this will be determined either by fundamental analysis or technical and fundamental.
      Using the technical analysis as a reference
      As a technical trader, we must me used to the use of technical indicators we have in our platform or import external indicators.
      And we Can also predict the direction of the chart by just following the price action techniques.
      Which we can trade based on the support and resistance, using of the price patterns.
      Or perhaps we can decide to be a trend follower, all we just need to know is how to spot a trend early and ride it to make decent profit.
      The way we predict the direction price sometime depend on the individual choice, some news to choose wisely.


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      Default Re: How to predict price movements in the Forex market?

      When you speak with a lot of experienced traders in the Forex market many of them can confirm to the fact that the driving force behind their success has been their ability to skillfully predict the movements within the market.
      The following 5 factors will enable the traders to make additional correct predictions during this movement, thus enabling themselves a better chance for achievement.

      1 - Economic Growth
      2 - Geo-Politics
      3 - Interest Rates
      4 - Mergers and Acquisitions
      5 - Trade and Capital Flows

      The main goal of every forex trader is to correctly predict future worth movements of currency pairs. Unfortunately, anticipating where the price rate goes on a regular basis is far from straightforward, as dozens of various factors impact the forex market.
      The approach used to predict value movements also depends on the analyzed time frame, short-term value movement rate are influenced by a completely different set of factors than long-term worth movements.

      And most importantly if we can learn about technical analysis well, the prediction of the market could be more easy for us. In the technical chart, there has some indicator which most of the time confirm us where the price can go or what could be happened in future.


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      Default Re: How to predict price movements in the Forex market?

      There are various tools for the forex trader to analyze the price of different currency pairs in the market and each trader have diverse way of utilizing these tools. Obviously there is no trader who can be 100 percent accurate in predicting the direction of market price but a good trader must be able to be right at the very least 70 percent of the time for him to be successful.
      To predict the movement of price a trader must first study the past behavior of the market and how the price react to the different scenario that happens on the market. Of all the two major analysis that exist for analyzing and predicting the market, my favorite is the technical analysis, this is because most of the times price obey some technical levels irrespective of the fundamental economic news happening. For example if the trend is bullish and the price is around the support levels, i will predict the price to go up and buy from the support.


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      Post Re: How to predict price movements in the Forex market?

      There no how we make mention of price movement that we don't acknowledge bid price and ask price. Bid price movement has the highest publicity price a buyer is assigned an order to buy at. While ask price shows the lowest publicise price a seller is is notice an order to sell at.
      considering how to predict price movement, it will determine whether the economy of a country's is and how higher option which the central banks disire raise interest rates in or to stop inflation growth. Prices that people offer in a separate amounts of allotted in the stock market or promise in the futures markets at each of those prices. In a case, a trader might as well desire to set up bid or ask at any price they want, but there is no responsibility another trader as well carry out with that order.
      Price can draw fast or slowly rely on how aggressive the buyers and sellers are. The price can act faster if someone push out a big market buy or sell order.
      Last edited by MT5 bozZdeviL; 11-10-2018 at 08:00 AM. Reason: Duplicated posts


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      Default Re: How to predict price movements in the Forex market?

      In Forex trading to predict price movement there are some things a trader should look on to such as fundamental analysis and technical analysis in fundamental analysis it involve in known the strength of economic of the country you want to be trading their currency in order to make a wise prediction when on trading and in technical analysis to forecast the price movement thoroughly you have too look into the past market chart the price particularly because at times market price repeat itself in predictable patterns in turn those patterns


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