How to establish a foreign exchange market analysis framework

First, maintain contact with the market.

Anyone active in the market should maintain contact and dialogue with the market to understand what is going on in the market. It is through external contacts and contacts that we can understand what other people are thinking and likely to behave. This in turn helps us determine what is important information and how the market is likely to develop.

1. Establish a channel of external communication. The other party should have an ideal performance record and be willing to explain the basis of their predictions, not just provide the predicted results. In addition, internal and external brainstorming can also help.

2. Read different market reports to gain a comprehensive understanding of market developments. However, you should not try to read all the reports because you will forget most of the content and achieve nothing.

Here are some things to keep in mind when engaging with the market

A. Relevant economic data to be released soon;

B. Forecast of interest rate levels and future interest rates;

C. Upcoming transactions, such as large acquisitions;KCM Forex

D. Political events, policies and outcomes: such as elections, budgets and statements, tax systems and changes, fiscal revenue and expenditure, etc.

E. Market sentiment;

The development of other markets, such as bonds, commodities, and stocks

G. Central bank intervention;

H. Economic fundamentals: economic activity, balance of payments, inflation

I. Developments in other regions of the world;

J. Support and pressure levels in technical analysis;

Second, do it yourself.

1. Anyone who tries to analyze the market should have practical trading experience. Paper work is also a good way to do it if you don't have the opportunity to actually trade. The so-called paper work is to record all the details of the trade, but not actually carry out the trade. To improve the effect of paper work, you can express your opinion to your colleagues when they complete a trade. Trading always loses money, which is quite embarrassing for most people, but you should learn from it.

2. Within the time limit, you should conduct your own technical analysis to determine important price points and price patterns. If time does not permit, browse the technical analysis reports completed by others, but you must not follow others.

3. When making predictions, a concise written report should be written.foreign exchange marketNewcomers in particular have to go through this process. It's quite time-consuming work, but it allows you to focus on the important factors and make your vision concrete. After a flick of practice, it becomes quite simple and less necessary.

III. According to your actual situation, decide which analysis and forecasting framework to adopt.

Newcomers must first decide which analytical and forecasting framework to use. For example, for traders in spot foreign exchange, minute-by-minute information is required; for managers in the corporate world, the time frame is usually longer; of course, if it is only a learning nature, it can only be trained through simulation operations.

Finally, please keep the following points in mind before starting your currency market analysis:

1. You can't consistently beat the market.

2. Markets may not always behave rationally.

3. There are always factors in the market that you don't expect. Sometimes they help; sometimes they don't.

4. There is no point in criticizing others' trading decisions after the fact, unless you are actually responsible for the operation and bear the relevant responsibilities.