Forex encyclopedia

Usually traders use two types of analysis in Forex – technical and fundamental. The first one involves chart analysis with application of mathematical methods and principles. Fundamental Analysis in Forex implies monitoring of political and economic indicators as well as monetary policy of countries. The main difference between the methods is the approach to the creation of price on the chart. Traders who prefer technical analysis think that it is enough to analyse the actual prices, because this data already includes all indications and reasons of change. However, followers of fundamental approach state that prices depend on fundamental factors and mark relationship between demand and supply. Thus, using technical approach traders analyse prices and relying on fundamental approach they deal with analysis of the trading instrument. Fundamental analysis in Forex examines political, economic, macro- and micro indicators not only for individual countries, but for global environment also.

This fundamental indicator of the USA slightly influences on the Forex market and is seasonal, however it can serve as supplementary. Macroeconomic index Building permits is collected on the basis of data from 19 000 enterprises issuing those permits. Basically this indicator is anticipating, because it preliminarily shows solvency of people. In addition, the number of permits allows judging about forthcoming unemployment level. If there are more permits than for the previous period, this economic sector will need employees, therefore, unemployment level can drop down.