About Forex

 

 

If the fundamental level, the level of exchange rates on the forex is based on the principle of supply and demand, the volatility of the forex exchange rates and also respond to this foundation, but they also obey different variables, less structural.

First of all, economic variables (publications, statistics and indicators) and significantly influence the abrupt currency. These economic indicators and statistics are published at fixed times, and the impact on the currency is immediate. If these variables generate spectacular movements in the short term, the corrections can be particularly brutal.

Among the important statistics, there are fundamentals such as GDP growth figures from the U.S. or the Euro zone or, another example, the U.S. unemployment rate. These are different economic elements, before publication, analyzed and estimated. The market reaction occurring between the results published and what was expected.

Monetary variables are mainly related to levels of interest rates.

 

When significant differences appear between the sustained interests of two or more currencies, movements in exchange rates will occur so that a risk-free investment in one of the currencies is equivalent to the risk-free investment of the same maturity in the other currency.

Typically, a currency with high interest rates or interest rates higher than those of other major currencies attracts capital and investment. C is in this context that the decisions and comments from central banks are particularly followed. Of course, this is especially true with high acuity and for the decisions of American central banks (Federal Reserve) and European (European Central Bank).

Variables speculative are variables related to the behavior of stakeholders.

A large number of investors and refer only focus on what the charts say. It is based on the results of the engineering analysis that the positions will occur in the forex with impacts, more and less important on the valuation of exchange rates, which will depend on the size of the volumes managed by stakeholders.

A number of major players, such as financial institutions and hedge funds, taking into account both the technical analysis and both the fundamental analysis. The most important of these players are called the Insiders. It is often those whose positions will move to end the trend of forex and exchange rates.