FX Traders’ “Adult Economics” Basic Course | Episode 1 Fundamentals Basics [Koichiro Amamiya]
From this issue, a new series by Koichiro Amaya will start, offering systematic study of fundamentals (analysis). Fundamentals are an indispensable method for reading the broad direction of the market, so it is sure to be useful even for technical-oriented FX traders. If you have previously avoided or neglected fundamentals, use this series as an opportunity to learn from scratch.
Table of Contents for Episode 1
1. What are Fundamentals (Analysis)?
2. Why are they necessary for FX trading?
3. Technical analysis considered as the opposing side
4. How to know where market interest lies
5. “Consensus” and “Surprise”
6. In the medium to long term, trends are important
7. Episode 1: Summary of “Fundamentals Basics”
※This article is a reprint/edit of FX攻略.com June 2017 issue
Koichiro Amaya (Amaya Kōichirō) Profile
For more than 20 years, has held key foreign exchange positions at major foreign banks such as UBS, JPMorgan, and BNP Paribas. Has been ranked among Tokyo Foreign Exchange Market’s popular dealer rankings in the financial magazine EuroMoney. In 2006, became a freelance financial analyst, providing FX market information to FX companies and portal sites from his sharp perspective.
twitter:https://twitter.com/geh02066
What are Fundamentals (Analysis)?
We have repeatedly discussed the significance and importance of fundamental analysis, and now we have the opportunity to present a series that systematically covers the basics of fundamentals. For those who find fundamental topics puzzling or who don’t know where to start learning fundamentals, this is for you.
In this first piece, as an introduction, we will clearly explain what fundamentals (analysis) are, why they matter, and through what pathways they influence the currency market.
Fundamentals are understood as “the basic conditions for judging a country’s economic state,” but in a narrow sense they refer to economic data such as “GDP growth rate,” “inflation rate,” “unemployment rate,” and “trade balance.” Using these data to analyze economic trends and markets is what we call “fundamentals analysis.”
Think of a country’s economic state as its fundamentals, and you might say, “Country A has strong fundamentals,” or “Country B has weak fundamentals.”
The basics of fundamentals analysis lie in understanding economic data. That said, you don’t need to know advanced economics or textbooks. In rough terms, it’s enough to know whether economic activity is active; there is no need to feel intimidated.
