Market Analysis

Friedberg Direct’s Market Analysis

Stay updated with the most recent market analysis, which can guide you on the road to successful trading. Both fundamental and technical analysis have proven crucial for trading as they help grasp a deeper understanding of the market and assist in making educated decision whilst trading.

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Technical Analysis

By definition, technical analysis is the forecasting of the future price action of an underlying financial asset based on its past price behaviour. Essentially, technical analysts believe that ‘history repeats itself’ and thus, a price chart is a technical analyst’s best friend. Some of the methods used by technical analysts include tracking chart patterns, such as head and shoulder pattern, and utilising mathematical indicators, such as moving averages and Stochastics.

Fundamental Analysis

By definition, fundamental analysis is the study of economic, social and political factors that affect the supply and demand of an underlying financial asset. Basically, while technical analysts seek to find out ‘when’ an asset’s price will move, fundamental analysts attempt to establish ‘why’ an asset’s price will move. A major method which fundamental analysts apply in the market is tracking the Economic Calendar for major economic events and news releases that may have an impact on the prices of their favourite assets.

Sentimental Analysis

The prevailing price action of any particular underlying financial asset reflects the overall opinion of all market participants. The combined ‘feel’ or ‘mood’ of the market is what is referred to as market sentiment. Essentially, sentiment signifies the combined attitude of market participants towards risk. When the sentiment is bullish, the price of the underlying asset will tend to go up; whereas a bearish sentiment will drive prices lower. A major sentimental analysis tool in financial markets is the COT (Commitment of Traders) report released every week by the U.S. CFTC (Commodity Futures Trading Commission). AvaTrade also displays its own summary of overall long and short positions of major assets on its WebTrader platform.