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Tradeonomics – Four Steps to Trading Economic Indicators

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What you’ll learn

Increase your financial intelligence by understanding economic indicators, their influence on financial markets and the central bank’s reaction.
Essential course for FOREX, Bond, Stock, Commodity traders on Fundamental Analysis
Learn by completing multiple projects on the impact of economic indicators on financial instruments, calculations of nominal and real GDP, growth rates etc
Learn the fundamental techniques that investment bankers use for trading
Technical analysts can complement their trading skills by understanding fundamental analysis
Improve your investing skills by understanding the effect of macroeconomic indicators on financial markets
Increase your financial wealth by increasing your financial intelligence. According to Robert Kiyosaki, author of “Rich Dad Poor Dad”, increasing your financial intelligence increases your financial wealth and one of the core technical skills to improve your financial intelligence is to understand markets
Improve your ability to make the connections between economic indicators, financial markets and central bank policies
Learn to predict the future direction of a country’s economy
Understand the impact of economic indicators on stock, bond and forex markets
Learn the reason’s why central bank’s react post the release of macroeconomic indicators
Technical analysts can complement their trading skills by understanding the fundamental analysis that drives the markets
Read the financial papers, watch financial news, learn financial jargon and participate in financial discussions
Learning macroeconomic indicators and the impact on financial markets greatly enhances the chance of getting an investment banking job

Requirements

No prior knowledge of economics or finance is required. This course starts with the basic concepts of bonds, stocks and foreign exchange markets. We then move on to the fundamentals of growth, inflation and interest rates using an example of a hypothetical country that starts as a simple economy and progresses to a more realistic one. With the constant reference to an economic map we make the connection between growth and economic indicators related to growth. We deduce how these economic indicators will influence the reactions of financial market participants and central bankers.

Description

A Step by Step Guide to Using Fundamental Analysis in Your Trading Strategy

Do you know the #1 reason why many retail traders underperform compared to their market counterparts namely – interbank dealers, hedge funds, financial institutions?

Studies suggests that despite retail traders having strong requirements to be well informed they are not. They do not anticipate returns on trades, lack trading acumen and are emotional when trading.

What stops traders from being better informed, improving their trading acumen or reducing emotional trades such as hope and wishful thinking?

The answer is – it’s not easy to make the connections between the economy, central bank actions and financial instrument prices.

However there are just 4 steps that simplify the process of making the connections between these three factors easier. Continue reading to find out the 4 steps…

As a trader in the interbank market I relied purely on technical analysis for the first few years. Drawing trendlines, using technical indicators such as moving averages, MACD, RSI etc etc to predict returns in the FX markets.

Though I utilised technical analysis I never really understood the “fundamentals” behind the primary trend or reversal of trends; what these linkages between economic indicators, financial markets and central bank policy decisions were…

To quote the guru of technical analysis –

“Market Analysis can be approached from either direction (Technicals or Fundamentals). While I believe that technical factors do lead the known fundamentals, I also believe that any important market move must be caused by underlying fundamental factors. Therefore, it simply makes sense for a technician to have some awareness of the fundamental condition of a market.” – John J. Murphy, Technical Analysis of the Futures Market

Technical Analysis Course

How to understand about technical analysis: Learn about technical analysis

In finance, technical analysis is an analysis methodology for forecasting the direction of prices through the study of past market data, primarily price and volume.
Behavioral economics and quantitative analysis use many of the same tools of technical analysis, which,
being an aspect of active management, stands in contradiction to much of modern portfolio theory.
The efficacy of both technical and fundamental analysis is disputed by the efficient-market hypothesis, which states that stock market prices are essentially unpredictable.

What is forex?

Quite simply, it’s the global market that allows one to trade two currencies against each other.

If you think one currency will be stronger versus the other, and you end up correct, then you can make a profit.

If you’ve ever traveled to another country, you usually had to find a currency exchange booth at the airport, and then exchange the money you have in your wallet into the currency of the country you are visiting.

Foreign Exchange
You go up to the counter and notice a screen displaying different exchange rates for different currencies.

An exchange rate is the relative price of two currencies from two different countries.

You find “Japanese yen” and think to yourself, “WOW! My one dollar is worth 100 yen?! And I have ten dollars! I’m going to be rich!!!”
When you do this, you’ve essentially participated in the forex market!

You’ve exchanged one currency for another.

Or in forex trading terms, assuming you’re an American visiting Japan, you’ve sold dollars and bought yen.

Currency Exchange

Before you fly back home, you stop by the currency exchange booth to exchange the yen that you miraculously have left over (Tokyo is expensive!) and notice the exchange rates have changed.

It’s these changes in the exchange rates that allow you to make money in the foreign exchange market.

Salepage : Tradeonomics – Four Steps to Trading Economic Indicators