Basics

Understanding Fundamental Analysis


If you want to understand fundamental analysis it is important to know that there are two very important aspects of the economy that everyone needs to know. One we call the real economy. It is the daily aspects of our life as if we have or not a job if the amount of money we earn is enough to pay our bills.

If you are a company, this real economy is how much you sell and the number of its investments.

🎯 We expect to help you invest efficiently in forex and improve your results. Get extra valuable forex trading ideas from leading finance experts on the trading Academy and on our free forex Telegram channel.

💡 When trading forex, we suggest you consider long term results.

The second important aspect of the economy is called monetary. It means that is all about money. This happens in the financial world, like banks, trade companies, hedge operations, and so on.

Those two worlds are relatively independent. The first believes it matters more at the end of the day. Because “we can’t eat money bills or coins”. The other believes that price “knows” everything, in other words, once you see the price of something it already has to the count all the aspects of the real economy.

The decision-making based on the real economy is called Fundamental Analysis. It brings to account all facts related to the history of assets, companies, countries, etc. It also looks upon indicators like inflation, GDP, exchange rate, new policies, and international affairs. Everything that can influence the results in the real economy.

What you can learn ahead 🎓

  • Understanding fundamental analysis
  • How to use fundamental analysis to trade
  • What is the best: AI trading or forex signals
  • The impact of elections in forex
  • How to use AI to trade forex and take advantage of the market
  • What are the best forex brokers to trade

If you are willing to practice Fundamental Analysis

It is necessary to be aware of what’s happening in the market you want to play. The analogy is a parabolic antenna, receiving information from all sides.

You can think of two Fundamental Analysis as a good helper to see long periods ahead. It relies on a more resilient fabric, the history of events. I mean, if one country has a huge rupture in its credibility, it is unlikely it will have a strengthened in its currency vis-à-visother currencies more reliable.

For example, when Brazil discovered the pre-salt layer petroleum, the public national company shares soars. While the price of petroleum commodities falls.

The first came with a higher expectation that the company will make more profits. The second, because as commodities petroleum decreases price once it is more abundant.

In the opposite direction, when Aramco company suffers a terrorist attack like it recently happened, the interruption in production makes the petroleum price rapidly increase. Partially because of expectations of scarcity, in part, because there was uncertainty about the possible military response involving other countries in the region.

We are all about to inform and educate

If you’re thinking about becoming a Fundamental Analyst than Wiseinvest has a role in your journey. We can provide educational and informational content necessary to make the right calls in the market. Even you have other sources of information we always can provide a second opinion.

What is more special is that if you don’t have the time or the technical skills to make this analysis than Wise trades are a perfect fit for you. It provides the proper information to you to act at the right moment.

US presidential election forex cycle

The presidential election cycle theory examines the connection between the 🇺🇸US presidential election, which is held every four years and patterns in the financial markets.

An examination of the association between US exchange rates (fx pairs with USD) and presidential cycles indicates a significant economic and statistical relationship. Research suggests the US dollar has shown greater gains when a Democratic president holds the highest office compared with a Republican White House.

The researchers found the US dollar appreciated during the term of a Democratic president but depreciated over the four-year term of a Republican president. This conclusion was based on a review of the years 1957-2016, using the exchange rate of the US dollar against several major currencies.

One explanation of this phenomenon is that Democratic presidents often implement policies that stimulate short-term economic growth and higher consumption, which causes the US dollar (USD) to appreciate. A Republican administration, however, is usually identified with a pro-business agenda, which may result in a weaker dollar. President Donald Trump has often said that he wants to see a lower US dollar in order to make US exports more competitive and has not hesitated to criticise the Federal Reserve for not reducing interest rates, which would cause the greenback to depreciate.

The Impact of the US presidential election in forex 💹

When we talk about US dollar performance, we are talking about a currency pairing, so let’s examine two of the most important currency pairs in forex trading. The first one is EUR/USD 🇪🇺 🇺🇸 – the most popular forex pair.

According to the theory we explored earlier, a significant change in the value of the US dollar on the day after election day is unlikely, but whether it will appreciate or depreciate in the months after the polls will be largely dependent on which candidate wins. If Trump wins, the impact on the euro (EUR/USD) would be a lower US dollar.

The best way to trade forex

There are two ways to invest with our AI in forex without concern about fundamental analysis.

1. Automated with AI-Trading. Check out the 3 steps to trade automated with our AI.

automated trading with ai bot

By trading forex automated with AI, you will save time and improve your performance without monitoring the market and managing trading platforms.

With Automated AI trading you do not need MT4 / MT5 and other trading platforms to invest in forex. All forex trades are automatically placed into your broker account every time that our AI system identifies a new worthy trading opportunity. You can monitor the AI trading performance in real-time directly on our dashboard.

Automated AI trading benefits

  • Setup in 3 minutes.
  • Totally hands-off, from anywhere.
  • Invest from just $1.
  • APY of 40% over the past 13 years*.
  • Lightning-fast execution & no slippage.
  • No commissions, no management fees.
  • Portfolio with 40 different automatic strategies.
  • No MT4/MT5 or other platforms required.
  • Test with a risk-free practice account.
  • Trading results directly on our dashboard.

Don’t you have a broker account yet? Our AI is integrated to trade automated with the broker Oanda. Click here to open an account.

2. Manually with AI forex signals.

Wiseinvest also provides AI forex signals that perfectly fit into MT4, MT5, and any trading platform. To trade with our AI forex signals, you must simply copy the data you receive from each real-time signal into any forex brokerage account of your choice.

There are five unique variables for each AI signal, and each must be copied exactly, in order to match the performance of the signal as close as possible.

Each AI forex signal alert consists of the following five data points:

  • Symbol (forex pair)
  • Direction (long or short)
  • Position size (number of units or lots)
  • Take profit (price level to exit with maximum gain)
  • Stop loss (price level to exit with maximum loss)

Check out how to trade with our AI forex signals.

  1. Subscribe to a Wise-Plan.
  2. Open a Brokerage account. Check this article about the best forex Brokers.
  3. Set an amount and a position size on our Wiseinvest dashboard.
  4. Our AI will send you real-time trading alerts by email and Telegram.
  5. Copy the signals and paste into your Brokerage account.

All forex signals are sent every time that our AI trading system identifies a new trading opportunity. Our trading strategies are developed on a variety of time frames such as 4 and 8 hours.

Wiseinvest AI forex signals are Market Orders and you do not need the entry price. You can copy each signal while it is available on our dashboard. We do this way to assure that traders will just place signals while they are good to be traded.

You can trade forex with our free forex signals clicking here, or with our Premium subscription that provides you unlimited AI signals and automated AI trading in partner brokers. Whether you are a beginner or a professional forex trader, our AI trading system can help you save time and improve your trading performance. Get started with free AI.

When investing through Wiseinvest automated AI trading or AI forex signals, you do not need to calculate pips and change the leverage in your forex broker account. Learn more about leverage in forex trading clicking here.

What is the AI performance in forex trading?

The Win Rate of our AI varies according to the period and can reach up to 95%. The performance is based on the efficient frontier measurement metric, which means that our model is profitable whenever the Win Rate is greater than 60%. All strategies of our AI trading system seek stable returns and sufficient results to achieve an average return of 40% per year (APY), without the use of high leverages.

We understand that what matters in forex trading is the final result. Thus, the investor needs to consider that Win Rate is not always the best metric to measure performance in forex, as other signal providers disclose. For instance, out of 100 trades, only 1 trade may be enough loss to make the 99 trades not profitable. In this case, the Win Rate would be 99%, but the final result would be unfeasible (negative).

We focus on the return of 40% of APY and not just on Win Rate.

It is essential to observe that forex brokers may charge spreads, commissions, and overnight fees in your trading account, and these factors can affect the AI performance. You can check our forex trading track record to understand more about AI trading performance clicking here.

How much do I need to trade forex with AI?

You can start in forex trading with free AI signals or AI trading account and deposit just $1 in the broker. It is also possible to test using a risk-free practice account with our AI trading system. However, in order to do efficient risk management in real accounts, we suggest you start from at least $100. Notice that some forex brokers require different initial deposits to trade forex.

What is the trading strategy of our AI?

Our AI strategy is the combination of different AI trading systems, with more than 100 features, that define 40 different strategies which simultaneously consider: Quotes of the 28 forex pairs, Supports & Resistances in different time frames, Trends and Counter-trends, Cross-indicators, Index of each pair, Economic Calendar, Investors Sentiment.

Our AI analyzes those fundamental, technical, and sentiment factors that affect forex trading, and all criteria are evaluated in real-time using different weights. After completing the analysis, the choice of the signal emission strategy is made considering the increased likelihood of short-term profit and the amount available for investment.

Using technical analysis, our algorithm considers not only the patterns of various trends, including support and resistance levels and cross-indicators, but our AI is also able to create its own real-time index for each currency pair, that is used to identify what is the best direction and target.

In relation to fundamental analysis in forex, the AI makes a correlation within the economic calendar to find news data that can affect specific currency pairs.

Takeaways

  • Fundamental Analysis is based on the real economy, it means the production of goods, services, investment, and all aspects of our daily life.
  • If you want to practice Fundamental Analysis you must be well informed, with a broad source of information and standpoints.
  • If you don’t have the time or the skills to do it, then use the Artificial Intelligence Wise Signals to be always aware of the best market opportunities. Plus, subscribe to our newsletter to get better informed about finance and forex trading clicking here.

Disclaimer: Forex and Contracts for Difference (CFDs) are complex instruments and come with a high risk of losing money due to leverage. Forex trading is not suitable for everyone. You should consider whether you understand how forex and CFDs work and whether you can afford to take the high risk of losing your money.

The forex brokerages displayed shall disclaim the overall performance of traders in their platforms. Oanda warns that 76.8% of retail forex traders lose money trading CFDs. XTB warns that 80% of retail forex traders lose money trading CFDs. FXCM warns that 74.74% of retail forex traders lose money trading CFDs.

The performances aforementioned are not related to Wiseinvest AI forex trading and AI forex signals system. You can check the performance of our AI forex system on our dashboard.