How to interpret fundamentals and sentiment ?

[Agent86]

Hi all,
With all the various degrees of trading methods my question is toward fundamentals and sentiment.

I see some trade spikes on news reports and other have weekly or even monthly analysis on the market direction and even market sentiment for the week.

I'm not sure how to interpret the fundamentals in spite of the calendars which have a guide to tell you what is considered possible or negative generally.

I get the impression that the high impact news releases are mostly relative to a spike. They might show confirmation that a currency strength is going to continue or perhaps it may only be a reversal spike that does not really impact the market sentiment and then continues after this.

How can I trade news based on those general calendar advise if I don't really even understand the strength of one currency or weakness vs another.

Does one currency sentiment vs another currency sentiment have a measure of which is more positive vs negative ?

Does consumer confidence of one currency vs another currency have a measure of how to interpret anything ?

I'm mostly just confused about how to interpret the direction of a currency pair and why it's moving one way or the other. I do understand that there are the news release spikes but not sure what to learn next.

It's like trying to speak a language by reading a dictionary in this language. Without instruction I'm not sure what to learn about and the information overload makes me wonder if what I read is even a subject to know about.

Anyhow anyone want to chime in on fundamentals, sentiment and give a summery of how and why a market might move in one direct or another vs another currency ?

Thanks

 

[Agent86]

One more thing I forgot to ask about is all the other continuous news releases that I see in my news section of my platform ?

Although the calendar news may not even create a spike at times other times show news reports about bonds, balance statements, bank talk references, and other things that are sort of continuous throughout the day.

What are people doing with those if anything ? Are they trading this information / news or just reading it for confirmation about something that is on the calendar and/or general sentiment of the markets ?

These news articles are things that are not in the calendar parts of the news releases that are suppose to be the main important things but also seem to move markets.

Please advise

 

[Jeff Martinez]

Sentiment is basically the mood of the market, think of the market as a big group of people all trading against each other and if you put them all together you get one really complicated human being. Fundamentals are what’s driving each currency at any given time in the long-term, and that is dictated by the central bank of each country and the interest rate expectations.

 

[Makenzie Malachi]

The mood of the market is basically called sentiment. If you define the market with a big bunch of people then everyone is trading against each other. So trading against the huge number of people all around the world is really complicated and a work of pressure. Fundamental trading is dictated by the central bank of every country. In the long-term fundamental is drives each currency at any given time.

 

[fxoday]

Sentiment market is like as battle between buyer and seller what dominating market will be winner, the news only as a trigger, and each market participant has own view regarding the news, a movement that occurs is collective action all market participant

 

[Purecaster]

It all depends on the market situation and time frame, capital size, etc. It is difficult to give any complete recommendations here, each situation is worth special attention. And this needs to be gained together with experience.

 

[Shaun89]

The hardest thing to tell for me with regards to sentiment and fundamental analysis is how often it is already priced in before the news is released since a lot of the time the banks will have a good idea of the likely figures to be announced.

 

[Olieng38]

There are two things that will help you - time and observation.
Sometimes you just need to test something perfectly in order to make a final decision.

 

[Meztigami]

In general, the correlation can be found between any two components. Much depends on whether this connection can really affect your results.

 

[ele020]

Fundamental analysis is dependent upon analysing current factors, predicting future factors, which can affect a country's economy. Fundamental factors are directed by the central bank of every country. In the long-term fundamental factors drive each currency at any given time, whereas sentiment analysis is based on how many people are buying or selling a particular currency, or their thoughts about which direction a currency will go.