Hi..what is way of analysing the market??

hi..im a newbie..correct me if im wrong..so far from my understanding..theres 3 time of analysis right..fundamental (news), technical ( Indicator), and 1 more is trend following.. as im reading a book about trend following..would like to ask the experts here..is it workable in forex if using trend following?? thanks

trend following isnt an analysis... and theyre are more types..

fundamental
statistical
technical
psychological
price action

some will lump price action under technical but i dont.. trend following is simply directionary you can use technical analysis to trade with the trend or technical analysis to trade contrarian style or fade the trend.

Fundamental - this is more than news... this is the sum of all the parts that define the currency.. we are talking interest rates funding and barrowing, meaning of move in different markets.. for example if interest rates are low and we have contango in oil.. which is spot price is lower that futures price or the forward curve.. its said to be in contango and interest rates will effect the spreads and the roll... this is fundamental.. this is the Basis for a trade IDEA.. if the dow is up and you trade the nikki and your strategy looks to be long based on the premarket movement and correlation with the dow that is fundamental... news releases are also fundamental.

Statistical - is researched analysis using historical ideas that are relevant and can be measured using left sided analysis and applied as right sided analysis. for example you see a trend and notice that the base or distance from low to low is narrowing statistically when the base narrows by X% trend has a high probability of breaking.. or if a low is broken by 50% distance .. a new lower high will form X% of the time. These are statistical analysis.

Technical analysis - is not researched and is artistic when you see a MACD and RSI on a chart it measures movements and tries to apply overbought and oversold signals based on a formula.. patterns is also technical analysis and candlesticks are technical analysis not price action. You will see it called price action I asure you it is not.

Psychological analysis- is understanding the traders and investors around you... these are done by understanding the cyclic nature of human emotion.. most people who believe in behavioral or psychological analysis are semi-strong form market efficiency believers.. where the market moves between fair priced and mispriced. they believe you can buy the difference in the mispriced and once its rebalanced do to human emotional cycles the trade ends. These are usually the guys that try to catch the CAPITULATION are in the markets and hold the market up.

Price action analysis - is the action of price most misunderstand the designation and combine other forms and consider them price action.. simply put if you are in an uptrend and price is retracing and never makes a high the price action for resumption to the trend never occurs so the price action remains bearish even in a up market.. Price action is said to be forward looking because in strong form market efficiency future is priced into the market and it will recover before the news recovers.. so price leads the market.

most of these have there positives and negatives.. for example...

fundamental is efficient and has a lower cost and is generally held longer lower cost is good but where exactly to enter and exit is questionable and much profits can be lost waiting for fundamental data as price leads it.

statistical is multisided and gives movements based on probabilities and on average.. but still is unable to give exact entrances and exits.. and statistical is expectional at defining money management rules.

technical shows more specific areas to enter but lacks exit and does not contain reason behind price moves only where or where not support and resistance and future trades may or may not take place.

Psychological understands the psych of the markets and where STRONG support and resistance will be based on how human emotions drive the markets.. these points can be turned into entrances that are rather accurate but not precise.. the lack of exit placement is a concern

price action is forward market looking and uses precise entrances and stops and market forward exits.. the great point of price action is its certainty in precision order processing. but it is not a market timing mechanism and usually must be mixed with some other form of analysis to become profitable.

hope that helps...
Forex is one of the most trendiest markets out their but it is not a supliment for being a more rounded trader.. traders must also excel at equity markets futures markets forex and emergent markets. the reason why is the close ties from one currency to the next and even tho the markets are global they are not diversified. so as accounts build the flow of money must be transfered to other markets.. to remain balanced in trading.

hey bro..thanks for the reply..is very detail..thanks alot

It is nothing more than Buying support and selling resistance, over and over, and in a trending market, find a trend with nice harmonic swings and trade on the final last push of the retracement. See the image I posted, this is how I do it. Been trading like this for the last several years.

Just make sure you have a confluence of support and resistance in the area your looking for the trend to start a new impulse wave. And always trade in the direction of the trend, including breakout trades....always in the direction of the trend.

--NM