Fundamental analysis explore not only the direction of market movement, but also the nature of factors, that contribute to this movement.
If we look back into the history, you will see that Fundamental Analysis occurred long before Technical analysis and was the only known method for analyzing world stock markets. This kind of analysis is used for exploring the processes of considerably long period of time. The truth is if you want to make quality Fundamental analysis you will need more time to do this compare with technical analysis.
To be explained the movement of certain currency pair by Fundamental Analysis, you need to take into consideration an enormous number factors. Meanwhile everyone factor need to be ranked by influence and duration. The factors the Fundamental analysis explore are many and different one from another. They can categorized in four major groups:
In the following lessons we will cover the most important and essential factors, for determining direction of movement.