As with the top financial traders working in banks and other financial institutions who are among the highest earners in the world, there is a need to be kept abreast of the global economy in order to take advantage of the dynamics of the Forex and commodities markets. DLS will thus introduce a few of the most basic but effective methods which top analysts constantly rely on to accurately predict the direction of these assets.
While there is no one right technique, we would like to inspire our investors are able to utilize a combination of these that fits their purpose and finally profit accordingly.
Fundamental analysis centres on the need for investors to possess intimate knowledge of global indexes such as the Gross Domestic Product, Manufacturing Indexes, as well as an array of other external data such as unemployment rate and the major interest rates globally. Having knowledge of such data will allow the trader to better assess the currency or commodity’s future value and which way it will fluctuate, especially if the reported data is different from what was previously forecasted.
In order to make a more accurate evaluation, investors should also bear in mind news reports and global events. All of these factors are essential for a trader to evaluate the true value of a currency or a commonly-traded commodity and anticipate which direction it will go in the long run.
To give a straightforward example, if the US Federal Bank decides to raise interest rates faster than expected, this could have a direct impact on the USD and cause it to rise against other currencies at least in the near future. DLS thus also emphasises on the importance of being constantly kept aware of global and financial affairs in order to better evaluate the type of trades to make.
Technical analysis is one of the most widely used tools in analysing the probable price of an asset. In technical analysis, a lot of the prediction of the future price of an asset depends on its historical price. As such, there is a huge dependence on the right type of indicators and charts to use.
Currency, as well as common commodities, are among the largest traded markets in the world and thus also among the most liquid. As such, the price movements of these assets on charts can give hints of market sentiment and provide clues to future prices. The importance of technical tools is thus even more essentially to making an accurate price forecast.
A trader’s psychology is also an important part of how he trades. It should be noted that while there are traders who are exposed to the same type of financial information and conduct the same type of analysis they will still have varying degrees of success in trading. It is thus important to be aware of your emotions and not allow it to cloud your judgement.
Feelings of fear, greed or even moments of great happiness can affect a person’s trading and cause that person to be more or less inclined to take risks against his better instincts. Thus, while DLS is able to provide you with the necessary tools for your fundamental and technical analysis, we also provide a timely reminder that your emotions are also just as important when making the right decision. Even more so, we hope you are able to further understand the general market sentiment and turn this to your advantage.
All of these elements combined enable the average investor to be equipped with the right tools and psychology to maximise their income. We are aware of these elements and will continue to work hard to ensure our clients are able to take advantage of all these resources; whether in terms of providing a top-notch trading platform, giving our clients access to the latest news, or even tips on how not to be emotionally affected.