Fundamental or Technical Forex Trading?
By: PipsAngels | Posted:November 28, 2009 12:00 am
Are you a Fundamentalist or a Technician?
Many times Technical Trading will completely ignore the Fundamentals, or Fundamental Trading will completely ignore the Technical Indicators. The problem is when you use one without regard to the other, you may be limiting yourself and causing losing trades, or trades that are not as profitable as they could be.
For example, assume the technical analysis was right to enter a long position. So you enter it with appropriate risk management rules. Shortly after, a news item hits the market and the position you hold is plummeting. You have no idea why and hang on expecting it to reverse, but it never does and you get stopped out for a loss. However, if you had also been listening to the fundamentals, you would know why the market dropped, and could get out before taking the full loss.
We believe that Technical trading is key to being successful long term, but we do not and cannot ignore the fundamentals if we want to be more successful.
