Fundamental Analysis is the assessment of a business or a whole economy based on data pertaining to that business or economy. For an individual company this would include an analysis of the balance sheet, liabilities, assets, revenues, earnings, profits etc.

For a country’s economy, fundamental (or macroeconomic) analysis would look at and analyse many factors including; GDP, Employment, Inflation, interest rates, production as well as many other data points.

Traders can then use their analysis to derive a valuation about the true fundamental value for a security, asset, commodity or FX rate. The fundamental (or macroeconomic) analyst or trader can then compare this valuation with the current price (of the security, asset, commodity or FX rate) and then make a decision of whether it is overvalued or undervalued, then decide whether to sell or buy.

In this section we will look at fundamental and macroeconomic analysis in more detail. Furthermore, we will deliver articles aimed at developing the readers understanding and use of this this approach. Read more forex trading tips.


Intermediate

What’s “Moo”ving Beef?

Posted on by Stephen Pope

Live Cattle prices look set to break out of the long-term corrective Packers finally accepted higher pricing on Friday A cold weather period has a heavy influence Technical sentiment is positive From 2016 through to the end of 2018 it appeared that the price of Live Cattle was rotating with a regular cycle in a … Continued

Intermediate

Gold Rally Poised To Pause

Posted on by Stephen Pope

Gold prices look limited over the short term USD tiredness at the end of the week helped push gold prices higher Technical sentiment is mixed A tightening labour market could suggest another Fed move   Gold prices have surged roughly 1.25% to the $1,320 area over the past week. The market was lifted by a … Continued

Intermediate

A Euro Breakout Against The Dollar: Or False Alarm?

Posted on by Stephen Pope

EURUSD recouped broken support on Friday There is every prospect that has placed a small upside back in play Fed and ECB signals not the easiest to decipher Buy Euro to seek small upside gains, be ready to trade back and forth The market for EURUSD during last Friday, i.e. January 25th, 2019, saw the … Continued

Intermediate

With Oil, Keep Looking at Trade Data and News

Posted on by Stephen Pope

WTI boosted by two clear driving forces, trade and supply Any recovery in trade relations between the U.S. and China not until end of January The decline in operating oil rigs in the U.S. will be reversed Selling will be the early form after a 3% gain on Friday The market’s WTI Crude Oil traders … Continued

Intermediate

A Parliament Of Preening Pharisees Can Scupper Sterling

Posted on by Stephen Pope

EURGBP slipped across the board on Friday and hit 3-day lows There is every prospect that PM May’s deal will be defeated on Tuesday In that event of one should see Sterling tumble Bearish Sterling sentiment will prevail if UK muddles on to a delay, no-deal or another vote The market for EURGBP rose in … Continued

Intermediate

Natural Gas Market Outlook Looks Bleak

Posted on by Stephen Pope

Natural Gas looks oversold after a 33% decline since December 10th Any recovery in prices should be capped at $3.16/Mm BTU In the event of stronger short-covering place a stop Bearish sentiment prevails and will take prices lower to $2.70 area The market for the natural gas market on the Nymex endured moderate week and … Continued

Intermediate

Gold Can Gain As A Savage Bear Stalks Stocks

Posted on by Stephen Pope

US equities undermined as shutdown and trade standoff spooks the market This has allowed a recovery in gold prices Shorts have been squeezed out of the gold market Bullish sentiment will dominate prices toward 1265 Gold slipped on Friday, December 21st, 2018 by $8.95 or 0.71% to close at $1258.95/Troy Oz. This may have been … Continued

Intermediate

Whoever is Short the Euro Has The Upper Hand

Posted on by Stephen Pope

ECB comments on the 13th undermined the Euro Any recovery in prices on Monday morning will be short lived No major reaction expected after FOMC on December 19th Bearish sentiment prevails and will take prices lower toward 1.1100 The Euro slipped on Thursday, December 13th when ECB President, Mario Draghi indicated that the central bank … Continued

Intermediate

Wheat Technicals Are Bullish Across The Board

Posted on by Stephen Pope

USDA reports may reveal wheat planting is somewhat low this season A recovery in prices looks likely given positive technicals The quality of Russian product is declining Look for the bullish sentiment to prevail and will take prices higher If the whispers on the street are to be believed, when the U.S. Department of Agriculture … Continued

Intermediate

Oil market outlook looks bleak

Posted on by Stephen Pope

WTI is not at the bottom of its decline Any recovery in prices needs the Russians and Saudi’s to drive further output restrictions OPEC meets on December 6th, but all members are hurting Bearish sentiment prevails and will take prices lower The market for crude oil has not yet found a bottom and has exceeded … Continued

Intermediate

End of Week Market Wrap 20181130

Posted on by Gavin Pannu

We had a positive start to the trading week in regards to equities. Major indices were boosted from the positive EU Economic Summit with firm gains on return from the Thanksgiving weekend and with a boost for retailers from Black Friday and Cyber Monday sales. Brexit was on the agenda at the beginning of the … Continued

Intermediate

Negative Start to the Trading Week

Posted on by Gavin Pannu

Over the weekend PM May struck a defiant tone with defending her Brexit deal while a growing threat of a leadership challenge looms. She stated there has not yet been enough letters to trigger a no confidence vote. So far, 42 Tory MPs have provided their letters for a no confidence vote which is 6 … Continued

Intermediate

Macroeconomic Update 20181119

Posted on by Gavin Pannu

PM May struck a defiant tone over weekend. 42 Tory MPs provide letter of no confidence PM May is set to head to Brussels to secure the deal Earning season comes to an end and US struggles to recover losses Macro data is relatively light this week.

Intermediate

Dollar Bulls must be patient, Selling pressure will be overcome

Posted on by Stephen Pope

Selling of the U.S. Dollar Index on Friday may persist through Monday As the week pushes on, this will yield to new buying momentum The technical sentiment for the Dollar Index is strong up to the next FOMC New bullish sentiment will prevail and will take prices higher The investor base certainly lost no time … Continued

Intermediate

Gold – Silver ratio looking ready to reverse

Posted on by Stephen Pope

The Gold-Silver ratio meanders slowly in channels As the major players in precious metals increase the bullish position on both The technical sentiment for both is almost identical Look for the reversal of silver shorts to be the more significant play There is a ratio in financial markets that is sometime overlooked in the western … Continued

Intermediate

No Fireworks in the Oil Market; Prices Fizzle Out on over Supply

Posted on by Stephen Pope

Iran appears to be getting off a U.S. sanctions hook As the Russians, Saudi’s and U.S. ramp up oil production, the market has excess supply The technical sentiment for oil has spun around since my last note on WTI Bearish sentiment prevails and will take prices lower The market for crude oil has enjoyed a … Continued

Intermediate

Daily outlook for 24/10/18

Posted on by Gavin Pannu

US Equities rebound towards the end of the session. POTUS adds further criticism to FED chair Powell. Price action reflects erratic risk tone PM May to meet 1922 Committee.

Intermediate

EURUSD: Can New Euro Strength Be Sustained?

Posted on by Stephen Pope

Any hint of good news re Brexit helps the Euro in the short-term If Theresa May compromises with the EU there will be pressure on her at home There is too much hostility to the leading array of contenders…she is safe for now Beyond Brexit, it will be Italy that drags the Euro down The … Continued