1.3 Technical and fundamental trading defined Video Lecture | Forex: Learn and Master Trading (English) - Business Basics

hi welcome to capex forex trading comm
in this video we're going to discuss the
main difference between technical
trading and fundamental trading so
technical trading is purely based on
chart analysis the reason for this is
because charts are viewed as graphical
representation of human behavior
so by simply looking at one of your
charts you were able to see how the
world reacts at various times of the day
now in terms of strategies employed in
this trading style you only need to
concern yourself with chart patterns
otherwise known as setups now we're
going to record many videos about chart
patterns or setups and we're also going
to teach you how to identify them trade
them and when to exit but in terms of
example what we've got here is a simple
technical trade so in this area here we
have a consolidation which is defined by
the top trend line and the bottom trend
line they make a sort of a wedge or a
triangle pattern but the trade that
we're looking for is a break of this
bottom trendline here in the downward
direction and that's exactly what's
happened there now please don't trade
this if you spot this at this stage
because there is a lot more that we need
to teach you in terms of trading this
pattern this is purely for example
purposes now fundamental trading is
slightly different it is purely based on
news or data it is not concerned with
any chart patterns or anything like that
in fact a lot of fundamental traders
don't even look at charts they simply
wait for news or data to be released on
a daily weekly or monthly basis now in
terms of the type of data that we're
looking for for example on the monthly
basis we're looking for the non-farm
payroll numbers from the United States
which is the biggest monthly number now
even if you're a technical trader you
should stay away at the time that this
data comes out because it has the power
to shoot drastically up or down now on a
more weekly basis we're looking for data
such as the US unemployment numbers
which is released from the US on a
weekly basis so these numbers obviously
can make the charts go up or down so if
you are a technical
later and you are in a very small
timeframe
you should also stay away from trading
these numbers but if you're trading in
timeframes for four hours or above then
you should be fine to stay in that trade
so in terms of example what we've got
here is a one-minute chart now the
reason why I've circled is because this
is quite a high drop down that's quite a
big quite a big black candle in the
market and in a 1-minute chart that's
quite rarely seen so this means that
some news has been released at this
point it stopped the current up thread
going up and it's reversed back down
very very sharply okay so this is an
example of a fundamental trade when news
has came out of the either the US or
some other country so for now that's all
you need to know in terms of our
examples and we should see you for the
next video Thanks