How to predict forex movement?

Forex movement is changing and changing cyclically. It means that there are such situations when the price behaviour becomes as predictable as possible. And if we predict the price, then we can earn the market. Can we predict the forex movement of the market?

How do I anticipate price trends?

Here are some points that can help :

Supply and demand forces, market drivers.

The concept of price action analysis.

Fundamental Analysis.

Technical Analysis.

Supply and demand forces, market drivers in forex movement :

The market is a seller, a buyer, and a commodity. The interaction between them determines the price. Based on the driving forces of the market, also known as supply and demand.

Supply: is the quantity supplied of a good or service available for actual trading.

Demand: is the amount of desire for the offered commodity.

The relationship between supply and demand is what determines prices. The greater the supply of a particular commodity, the lower its current price. It means that the forces of demand made by the buyers, which are what push the prices to rise. And the forces of supply made by the sellers, which are what push the price down, and the conflict between sellers and buyers in the market creates the forex movement of prices, and thus knowing which of the two forces dominates the market makes us expect the direction.

For example:

Most of the world’s currencies are bought and sold based on floating exchange rates, which means the prices fluctuate or change based on supply and demand in the currency market or forex. An increase in demand for a currency and shortage in supply lead to an increasing the exchange rate and vice versa. 

The concept of price action analysis:

To anticipate the trends of the forex movement, you must study its basic data – whether economic, financial – or price; The current and historical markets to be able to anticipate its destination during the coming periods, and in the financial markets in general, and in the currency market in particular. We have two major schools for analyzing market trends:

Fundamental or Economic Analysis.

Technical Analysis.

Fundamental Analysis in forex movement :

It is also called economic analysis and is concerned with studying the economic and political variables that affect the forex movement of currencies, assuming that the supply and demand are affected by the strength or weakness of the economy that pushes their prices up.

If the economic data is negative the signs of weak economic activity start to appear, like declining, deflation or stagnation, or even in cases of political tensions for the country that owns the currency. All these factors weaken the demand and increase the supply, which pushes its prices down.

For example:  

On June 23, 2016, the British people voted in a general referendum on the withdrawal of the United Kingdom or Britain from the European Union, or what is known as Brexit. Many economists have agreed on the expected negative impact on the British economy as a result of this decision. In addition to some political tensions between them and its neighbours In Europe, it entered into whirlpools of negotiations, which contributed to the emergence of a state of reluctance to trade the currency – the pound sterling – or the weak demand for it, against the US dollar, which was then in a state of economic stability, and thus the price of the GBPUSD pair fell, and thus provided a selling opportunity on the husband.

The forex market analyst relies on the economic calendar. That contains the dates of indicators and main economic events affecting the currencies traded in the currency market. So, it is possible to identify the economic influences expected to affect the forces of supply and demand and thus on forex movements.

Technical Analysis in forex movement:

It is concerned with studying price and forex movement through charts to anticipate price movement trends in the future. It relies on the principle that history repeats itself and that all events and influences that move the market appeared in the price movement. Therefore the study of price movement on the chart is sufficient to predict prices without considering its causes.

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