When I think of the first few things I learned before trading on the Forex market, the fundamental analysis came to mind. Fundamental analysis refers to the factors that influence the price of a currency pair. It is important not only to do technical analysis based on your forex chart and indicators. But also to influence currency pairs. What helps me in my forex education is the learning characteristics of each currency. Whichever currency pair you choose to trade is very valuable. That’s because they have the accuracy of every trade you make.
Europe – EUR
This currency is rather new. Started trading in 1999; however, the EURO / USD pair is the most traded. Therefore, the EURO / USD is very liquid. If you trade EUR / USD pairs, you must pay attention to changes in investor reaction. That is when trading in the EUR / USD pair affects each other. EURO / USD is my favorite partner because it provides potential trading.
Japan – JPY
Japan is the largest economy in East Asia; therefore the yen is used as an alternative to the economy of the entire region. If there are problems in surrounding countries, the yen may fall in value. The Bank of Japan is known to intervene in the foreign exchange market to maintain the value of the yen. Another factor affecting the yen is the overall strength of the banking sector.
This currency is important to note because the US is one of the largest economies in the world. The pound is influenced by energy and oil prices. When they rise, the pound must strengthen.
Swiss – CHF
The Swiss Franc is known as a safe haven for investors in times of crisis and uncertainty. Since Switzerland, the world’s wealth banks, and bank merger reports, and directly affect the value of the franc.
“Commodity currencies” include Canadian, Australian, and New Zealand dollars. Since the commodity is the majority of Canadian exports.
The Australian dollar is the most connected to the price of gold. The difference in interest rates is monitored because it can guide long-term trends.
New Zealand – NZD
The New Zealand dollar is related to commodity prices. This is also closely related to the Australian dollar, which means they can act as alternatives to each other.