There are many people who have entered in forex investment and ask that what is needed to get high profit on forex investment. Along with your knowledge and skills there are 3 types of analysis which you have to understand and control for your long and high returns on investment. These are
(1) Fundamental analysis
(2) Technical analysis
(3) Trading Psychology
Now we will keenly read and observe these three analyses.
It is an analysis which is based on many things like data and market news and information about the economics of different countries in the world. Economic news and market sentiment anticipate the investment but there are also many other factors which are non economic but they counts a lot in moving the market. These factors are political circumstances, geopolitical and security issues etc. these fundamentals really more the market.
(2) Technical Analysis:
This analysis is based on the market analysis or its also based on the price moments it foreign exchange rates. From the trading platform these foreign exchange rates can be seen on the charts. The market fluctuations, resistance, support and the chart pattern. From these patterns a trader can predict about the direction and strength of the trend, indications of consolidation, market reversal patterns, and market rebounds patterns, saturation point and much more.
(3) Trading psychology:
If you combine the above 2 analysis, you will be able to predict about what will happen in the market. This market direction may influence the trader’s investment decision, like the right time of entering into foreign exchange market, or exit the market, whether to buy or sell currency or do nothing. In forex market it provides opportunity to the investors to take advantages of the investment. But there are also some hurdles in making investment decisions. There are the human emotions which become obstacles. The worldwide traders felt the greed and fear. These are the common emotions which are found anywhere. These can make your decisions wrong. As the time is the most important factor so if you decide too early and too late also it will give you a sure failure. The worse effects are trauma, stress and even suicide. Therefore it is very important if you read and understand the trading psychology if you want to make a win and making profit in the forex investment.