US stocks recouped much of Monday’s losses yesterday and the S&P 500 index is now perched just under record highs. With little going on so far this week, investors turned to the latest drama between Trump and the Federal Reserve. On Monday, the president published a letter to governor Lisa Cook, announcing the immediate removal of the board member from her post. The letter has sparked a debate relating to whether the president had the authority to do so, once again bringing back the question of the Fed’s supposed independence. The move to remove Cook comes in light of an investigation by the Department of Justice, who called on Jerome Powell to dismiss the governor last week following allegations of mortgage fraud involving several properties. The situation has not resulted in any change in expectations to the next interest rate cut in September. Nvidia will publish its second quarter earnings later today after the closing bell. Despite the ongoing reshuffling of worldwide trade, shares are currently just under record highs at $181 while the company’s market cap now sits at a staggering $4.4 billion. The Trump administration initially banned Nvidia from selling chips to China before softening its tone and implementing a 15% fee to be paid to the government instead. Just how much this will impact the chipmaker’s bottom line remains to be seen, but according to the Q1 earnings call the measure is expected to slash $8 billion off the bottom line. #Nvidia #earnings #SPX
Last Friday, Jerome Powell finally changed his tune on the subject of interest rates, saying that a change in the Fed’s stance may be warranted. The comments came during the annual Jackson Hole symposium in Wyoming, where the Fed Chairman cited the growing risk of rising unemployment. The shocking jobs figures revealed by the July NFP report seem to have forced the Federal Reserve to pivot, paving the way for a rate cut in September. Markets reacted positively to Powell’s remarks, pushing all three major indices to make strong moves to the upside and raising the Dow Jones to a new record high. Predictably, the prospect of a rate cut weighed on the Dollar, dragging the DXY down the better part of a percent to 97.7. Gold meanwhile made marginal gains, pushing the precious metal to $3,371 per ounce by the weekly close. For all the optimism, a rate cut is by no means set in stone; Jerome Powell was deft enough to leave himself some wriggle room in this regard. The decision is still three weeks away after all and a number of data releases will grace the economic calendar before then. Nvidia (NVDA) will release their quarterly earnings after the bell on Wednesday. The tech giant rose in tandem with the broader market last Friday but the latest earnings may test the resolve of some investors. There are growing worries that the hype surrounding Artificial Intelligence may be a little overblown, a sentiment echoed by OpenAI CEO Sam Altman himself, who last week drew parallels between the current investment frenzy and the dot-com bubble in the 90s. A devastating investigation by MIT meanwhile revealed that 95% of generative AI projects had failed to yield any profit. Rough verdict. Very little to speak of in terms of tradeable events over the coming week. Nvidia is the only heavy hitter with regards to earnings, with most other reports coming from the financial sector. US GDP drops on Thursday but the more impactful event is likely to be the PCE price index on Friday, followed by Michigan Consumer Sentiment later in the day. #Nvidia #Federal #DJI
Saint Vincent and the Grenadines, the Bahamas, Vanuatu, tropical island getaways throughout the Pacific Ocean and Caribbean Sea. Rest assured dear reader, RADEX MARKETS is not pivoting to the tourism industry just yet – our ungrateful staff do not deserve it. Such idyllic locations are in fact vitally important to brokerage firms and to the financial world at large. Crack open a coconut, put on some steel drum background music and read on to find out why. Saint Vincent and the Grenadines has a population of 100,000 people. It is famous for tourism, bananas and as a filming location for the Pirates of the Caribbean franchise. The Seychelles has a population of 120,000 people and besides tourism, is famous for the suggestively shaped Lodoicea coconut (Google it) as well as actual, real-life pirates. Vanuatu meanwhile has a population of 327,000 people and is famous for an underwater post office. The point being, such places do not have a lot going on. Tourism is all well and good, as are small scale agricultural operations, but all it takes is one bad hurricane and both of these industries collapse overnight. A small population also means a small client base, further discouraging economic development. These remote island nations needed a way to attract stable overseas capital. Their answer was simple: Such countries opened their arms to the world by offering low or even non-existent taxes, a lax corporate environment, and last but not least, more permissive regulations. Companies from all over the world could now set up shop with relative ease and without having to worry about the more stringent regulations applicable in the likes of the UK or Australia. This is not to say that such jurisdictions are untrustworthy, it is after all in their best interest to attract as much international business as they can. Increasing their reputation on the world stage and complying with international financial guidelines are crucial in this regard. These territories eventually became fully intertwined with the wider financial world. The term “offshore financial centre” was coined to reflect this development and to distance these territories from the somewhat tarnished mantle of “tax haven”. It was not just about money after all, there was another distinct reason such countries came to occupy the position they did: Cayman Islands, Bermuda, Anguilla, Seychelles, Mauritius, Bahamas, Malta, Vanuatu… Some of our more eagle-eyed readers may have identified a shared ancestry among these countries: they are all present or former British overseas territories. Because of this, these countries all inherited English common law and were able to piggyback off London’s financial infrastructure. Common law’s bottom-up approach to legislation appears ideally suited to finance. Instead of relying exclusively on a strictly codified body of text, common law forms organically over time as various disputes and cases are settled. It is essentially a function of how the law has been previously applied. Disputes are easier to resolve in such a system due to commercial precedents. The law is more flexible when dealing with complex financial instruments and is better suited to rapidly changing market demands. Finance can change at a fast pace and legislation will often struggle to keep up, as we have seen all too often with cryptocurrencies for example. Systems built on common law also offer contractual freedom. If both parties agree to something, no matter how out of the ordinary, it will usually be upheld by a court as long as it is not in violation of any laws. That the largest financial centres in the world all sprung up in areas that adopted common law is no coincidence. London, New York, Hong Kong, Singapore and others have all retained their status because their legal frameworks appeal to international investment groups and law firms. All the tropical destinations mentioned above also benefit from these frameworks, while also retaining a greater degree of flexibility and independence. This allows such territories to offer products and services unavailable elsewhere, such as: Acquiring a licence from, for example, the Financial Services Authority of Seychelles makes a lot of sense for a brokerage firm. The biggest advantage in doing so lies with the services that brokers may then offer their customers, such as higher leverage. Leverage is a growing sticking point when it comes to trading. The bigger regulators such as ASIC and the FCA continue to reduce leverage across financial instruments, citing greater customer protection and reduced broker risk as to reasons why. Fair enough, but the fact of the matter is that many traders do in fact want higher leverage. As of right now, Offshore Financial Centres are the only way to do this. There is a kind of symbiotic relationship between traders and small island regulators. These territories offer vital services to traders and investors worldwide and in doing so benefit immensely from the international capital flows that reach their shores as a result. A win-win situation if there ever was one.
When you first look at a forex chart, it can seem like complete chaos. The economic news is packed with jargon, market commentators regularly contradict one another, and every trader online appears to have discovered the “only” strategy you will ever need. Unsurprisingly, beginners are often left wondering which approach they should take and more importunately – what they can trust. This guide explains the four types of forex analysis, what each method examines, when it is useful and how the different approaches fit together. By the end, you should have a much clearer idea of what you are looking at when the market starts moving. There are four types of forex analysis: fundamental analysis focuses on economic and political drivers, technical analysis studies price charts and patterns, sentiment analysis examines how traders are positioned and feeling, and weekend analysis evaluates risk and market conditions when markets are closed. Most experienced traders combine these methods rather than relying on just one. Ready to put your analysis into practice? Open your Radex Markets account today. The four types of forex analysis are simply different ways of examining the same market. Each one provides a separate piece of information: Fundamental analysis is a method used to evaluate a currency’s value by analysing economic, financial and geopolitical factors. This approach looks at the broader forces that can strengthen or weaken a currency. In other words, it attempts to answer the question: Why is the price moving? A country with rising interest rates, stable economic growth and controlled inflation may attract international investment, increasing demand for its currency. However, the relationship is rarely as straightforward as it looks on paper. Markets trade on expectations, so a seemingly positive economic announcement can still cause a currency to fall if traders had expected an even stronger result. The main drivers examined through fundamental analysis include: The important point is that traders compare the actual result with the market forecast. A number is not automatically positive or negative simply because it looks good or bad. What matters is whether it is better or worse than everyone expected. The table below sets out how the headline releases usually feed through to a currency. Suppose GBP/USD is trading at 1.2750 before a Bank of England meeting. Traders expect the Bank to leave its interest rate unchanged at 4.00%, but policymakers unexpectedly reduce it to 3.75% and suggest that further cuts may follow. Because the decision is more dovish than expected demand for sterling falls. GBP/USD drops from 1.2750 to 1.2630, a decline of approximately 120 pips. The rate cut itself matters, but the surprise is what produces the sharp reaction. If traders had already expected the reduction, much of the selling could have occurred before the announcement. The pair might then have moved very little or even risen as traders closed existing short positions, because the forex market occasionally enjoys making a perfectly sensible idea look foolish. Fundamental analysis is particularly useful for swing traders, position traders and event-driven traders who need to understand the forces that could shape a currency’s direction over time. Read more：Forex Fundamental Analysis: Meaning, Data and Trade Setups Technical analysis is the study of price charts to identify patterns, trends and potential future price movements. Rather than examining the condition of an economy, technical traders concentrate on what price is doing now. The method helps answer two practical questions: Should I enter the market, and where should I enter? Its core assumption is that the available economic and political information is already reflected in the price. Technical analysis also recognises that traders repeatedly respond to fear, greed and uncertainty in similar ways, which is why trends and chart patterns can reappear. These patterns do not predict the future with certainty, but they can identify areas where one outcome appears more likely than another. Technical traders commonly use: Read more：15 Best Chart Patterns Every Trader Should Know Read more：What is RSI in forex? Meaning, formula and signals Whatever the toolkit, everything starts with reading the direction of the market. Suppose EUR/USD is in an uptrend and falls towards a previously established support level at 1.0850. Buying as soon as price touches that level would assume that support will hold, but technical traders usually look for confirmation first. Price briefly falls to 1.0845 before recovering and closing back above 1.0860. The recovery produces a bullish rejection candle, suggesting that buyers have defended the area. A trader might enter at 1.0865, place a stop-loss below the recent low at 1.0835, and target the previous resistance level near 1.0925. The potential loss is 30 pips, while the potential profit is 60 pips, creating a risk-to-reward ratio of 1:2. The confirmation does not guarantee a profitable trade, but it provides a logical reason to enter and clearly identifies when the idea is wrong. Technical analysis is particularly suited to day trading, swing trading, scalping and breakout strategies where entry timing and price levels play a central role. Read more：Forex Technical Analysis: A Step-by-Step Beginner’s Guide Sentiment analysis is the process of assessing how traders are positioned and how they feel about the market. This approach examines the market’s overall mood and answers the question: Which side is everyone standing on? Traders are influenced by fear, greed and the tendency to follow a crowd, so positioning can become heavily tilted towards one direction. Extreme sentiment can sometimes warn that a trend is becoming vulnerable. If almost everyone has already bought a currency pair, fewer buyers may remain to push it higher. However, crowded positioning is not an automatic reversal signal because strong trends can remain one-sided for much longer than expected. Common sentiment tools include: The Commitments of Traders report is a weekly breakdown of open positions in US futures markets, published by the regulator. Forex traders read it to see how commercial hedgers, asset managers and leveraged funds are positioned in the major currency futures. Let’s suppose retail positioning data shows that 78% of traders are long GBP/USD, while only 22% are short. The pair has repeatedly tested resistance at 1.3100, but each attempt to break higher has failed. Price then forms another lower high at 1.3075 and falls below short-term support at 1.3020. The combination of heavily bullish retail positioning and weakening price action suggests that buyers may be trapped rather than in control. This does not mean a trader should sell merely because 78% of the crowd is long. It does, however, provide a reason to question new buy trades and wait for stronger technical confirmation before taking a short position. After all, standing against the crowd can be useful, but doing it too early still leaves you standing in front of it. Sentiment analysis works best as a confirmation filter rather than a standalone entry signal. Read more：What Is Market Sentiment? Definition, Indicators and Strategies Weekend analysis is the process of reviewing markets when they are closed to prepare for the week ahead. With no candles ticking and no temptation to chase a sudden move, it is often easier to see the broader trend clearly. Traders can mark important support and resistance levels, review the previous week’s performance and examine the economic events scheduled for the days ahead. Weekend analysis is not about predicting exactly what will happen on Monday morning. Its purpose is to create several realistic scenarios and decide how to respond to each one before emotion and market noise enter the equation. A typical weekend review may include: Suppose EUR/USD closes on Friday at 1.0950, with support marked at 1.0920. A trader’s weekend plan is to consider buying near that support if bullish confirmation appears after the market reopens. On Sunday, however, an unexpected election result creates political uncertainty across the eurozone. When forex trading resumes, EUR/USD opens at 1.0870, an 80-pip gap below Friday’s closing price and already beneath the planned support level. The original buying idea is now invalid. Entering at the new price simply because it appears cheaper would ignore the event that caused the gap and the technical breakdown that followed it. The sensible response is to reassess market conditions, allow liquidity to settle and wait for a new trading setup. Weekend analysis suits traders who prefer to plan ahead, particularly swing traders, position traders and those preparing weekly breakout strategies. There is no single best type of forex analysis, each of the four answers a different question, and which one matters most depends on what is driving the market at the time. A technical setup may carry more weight during an orderly trading session, while an interest-rate announcement can quickly make fundamental analysis the priority. The best approach is therefore the one that provides the information needed for the market conditions and trading decision in front of you. Set side by side, the division of labour becomes clearer. In practice, traders can use fundamentals to establish direction, technical analysis to identify an entry, sentiment to filter the idea and weekend analysis to prepare for the week ahead. Most experienced traders blend two or more methods because no single type provides every answer on its own. Read more：Technical vs fundamental analysis: which really works Knowing the four methods is one thing; using them in the right order is what can genuinely improve trading decisions. The following hypothetical GBP/USD scenario shows how each type of forex analysis can hand the decision to the next rather than operating as a separate tool. Fundamental analysis begins by comparing the economic outlooks of the two currencies in a pair. Interest rates, economic growth and central bank policy can help establish which currency appears stronger and which direction a trader may want to favour. Suppose UK inflation is falling faster than expected, leading traders to anticipate an earlier Bank of England rate cut. At the same time, US employment and inflation data remain firm, encouraging the Federal Reserve to keep interest rates higher for longer. This policy difference supports the US dollar and creates a fundamental reason to favour selling GBP/USD rather than buying it. The trader checks the economic calendar and notes that UK GDP figures are due on Thursday, followed by a speech from the Bank of England governor. The initial plan is therefore to look for a short GBP/USD trade while remaining aware that these events could alter the outlook. Technical analysis is then used to locate an entry area and define how much capital would be at risk. On the four-hour chart, GBP/USD is making lower highs and lower lows, while former support at 1.2820 has become resistance. Rather than selling immediately at the current price of 1.2760, the trader waits for a recovery towards 1.2820. Price reaches 1.2815, forms a bearish rejection candle and then falls back below 1.2790, providing confirmation that sellers are defending the area. The trader plans an entry at 1.2785, a stop-loss above the recent swing high at 1.2845, and a target near the next support level at 1.2665. This creates a potential risk of 60 pips for a possible reward of 120 pips, giving a risk-to-reward ratio of 1:2. Fundamentals decide what to trade; technicals decide when. Before entering, the trader checks positioning data to see whether the proposed trade is already excessively crowded. If most market participants are short GBP/USD, joining them could mean selling after much of the move has already occurred. In this example, retail positioning shows 68% of traders are long and 32% are short. The planned short position is therefore not following the majority of retail traders, which provides some support for the bearish idea. However, sentiment remains a filter rather than the reason for entering; the trade still depends on the fundamental outlook and technical rejection at resistance. If positioning had instead shown 85% of traders already short, the trader might reduce the position size or wait for stronger confirmation. Extreme sentiment does not cancel a valid setup, but it warns that the market may be vulnerable to a sharp reversal. The trader waits for the bearish candle to close below 1.2790 before entering at 1.2785, avoiding the temptation to chase price during the initial rejection. Current volatility is also checked to make sure the 60-pip stop-loss is not sitting inside ordinary market noise. GBP/USD later falls to 1.2700, allowing the stop-loss to be moved according to the trader’s risk-management rules while the original 1.2665 target remains in place. The position is reviewed after Friday’s close, along with the following week’s inflation data, central bank speeches and any political risks that could affect sterling or the US dollar. If the trade remains open over the weekend, its size and exposure are reconsidered because a gap could bypass the planned stop-loss price. This weekly review turns fundamental, technical, sentiment and weekend analysis into one repeating process rather than four unrelated tools. Read more：10 Forex risk management tips every trader should know Every method has situations in which it fails, and understanding those limitations helps a trader decide which information deserves the most attention. There is little value in treating a useful analytical tool as though it were a crystal ball. These limitations are not a reason to drop any method; they are the reason the Step 1–4 process exists, each one has a gap on its own, and together they can cover for one another. The best AI for forex trading analysis depends on the task: TrendSpider offers automated chart and pattern analysis, Capitalise.ai converts plain-language instructions into code-free trading automation, and LuxAlgo provides AI-assisted strategy building and back testing. TradingView also offers chart-based AI assistance and historical strategy-testing tools, although features and availability can vary. AI can accelerate chart scanning and back testing, but the judgement framework provided by the four types of forex analysis must still belong to the trader. AI can generate trading signals, organise historical data and explain concepts, but it cannot reliably predict sudden news, changes in liquidity or unexpected geopolitical events. Treat AI as a research and educational tool rather than an unquestioned signal source; the CFTC warns that no technology can consistently predict future markets. Technical analysis is best for timing entries and exits, while fundamental analysis helps determine market direction. When combined with sentiment analysis, traders gain a clearer and more balanced market view. Using more than one analysis method often produces better results. There are four main types of forex analysis: technical analysis, fundamental analysis, sentiment analysis, and weekend analysis. Each answers a different question about the market and contributes to a different part of the decision-making process. Most guides list only the first three; weekend analysis is the fourth—a preparation habit that helps traders organise their ideas before the market reopens. No, beginners do not need to learn everything at once. Most traders begin with technical analysis and gradually add fundamental and sentiment analysis; learning step by step is far more likely to produce consistency than attempting to swallow the whole subject in one go. No. Analysis can improve probabilities and decision quality, but risk management and discipline remain the baseline for every trade. Any person, system or AI tool claiming to guarantee trading profits deserves immediate suspicion. The methods remain the same, but their influence can vary between currency pairs. Interest-rate expectations and major economic releases usually play a particularly visible role in heavily traded major pairs, while exotic pairs may also be strongly affected by domestic politics, commodity exposure and lower liquidity; context always matters. Lee W. is a seasoned professional trader with over 10 years of experience. Passionate about sharing valuable expertise and unique market insights, Lee W. now serves as an external and independent market analyst for RADEX MARKETS. Reviewed by RADEX MARKETS Risk Warning Trading derivatives and leveraged products carries a high level of risk, including the risk of losing substantially more than your initial investment. Deeper into forex analysis: Related concepts:
A collective sigh of relief swept over Wall Street yesterday following the latest CPI reading. While core inflation increased to 3.1% in July, beating both expectations and the June figure, headline inflation remained at 2.7%, below economists’ predictions. The publication was reason enough to drive US stocks higher, pushing the S&P 500 and Nasdaq Composite indices to new record highs by Tuesday evening. With the latest inflation data out of the way, markets now have a relatively clear view of the US economy. Inflation levels, while not ideal, remain manageable. The labour market on the other hand appears to be struggling. By most accounts, this is a straightforward setup to lower interest rates on the Dollar in September and judging by overall sentiment, market participants seem to agree. The optimism has even spread as far as Japan, where the Nikkei 225 closed at record highs yesterday. The index continued to push higher still this morning, breaking above 43,000 points for the first time in its history. The economic calendar will provide another insight into US inflation on Thursday, this time in the form of the Producer Price Index, which is predicted to rise to 0.2% in July. Bitcoin remains near all-time highs of $120,000 but attentions are currently turned towards the broader altcoin market. Ethereum is currently toying with a record high of its own after a 9% surge yesterday pushed the token price above $4,600. The project rose to similar highs back in 2021 when prices topped out around $4,800 but the ensuing bear market destroyed such valuations for years to come. The increasingly loud question being floated around is whether “alt season” is finally back in play. Bitcoin dominance fell below 60% recently but has a long way further to fall before such claims can be substantiated. Shares in Robinhood (HOOD) closed at a record high last Friday, while paradoxically Coinbase (COIN) remains around 25% down from its peak in July. #Inflation #Altcoins
US stocks ended on a high note last week after a huge rally in Apple (AAPL) pushed the Nasdaq Composite index to a new record high. Shares in Apple rose over 13% last week following bullish projections from Wells Fargo as well as an announcement from the company that it is increasing its investments in the United States by an extra $100 billion over the next four years. Despite the worrying jobs figures published the week prior, all three major US indices finished the week in the green, with the Nasdaq Composite and S&P 500 gaining 3.9% and 2.4% respectively, while the Dow Jones rose by a more modest 1.3%. In Japan meanwhile, the Nikkei 225 is also pushing for a record high of its own after an early morning surge pushed the index back over 42,000 points. The rise in traditional markets was certainly nothing to be sniffed at, but it paled in comparison to the movements in cryptocurrencies. Bitcoin ended the week on good footing yesterday and carried over the momentum into this morning’s session. BTC is now hovering around $121k but the greater story lies in the altcoin market. Bitcoin dominance has taken an absolute beating recently and the gains seen up and down the leader board certainly reflect that. Even Ethereum has finally stepped up to the plate, convincingly breaching $4k and pushing into valuations not seen since the tail end of 2021. There is only really one item worth discussing on the economic calendar this week: US inflation. The PCE price index published two weeks ago suggested there had been an uptick in inflation in recent months, which may or may not be confirmed by Tuesday’s CPI report. Forecasts suggest a slight increase in core inflation to 3% year-over-year, while the headline figure is expected to hit 2.8%. Inflation is certainly one side of the equation, but the dire jobs numbers revealed by the most recent NFP report are a much bigger problem for the Federal Reserve. Stephan Miran is set to replace outgoing board member Adriana Kugler and should he be approved by the time of the next meeting in September, the Fed is facing the prospect of three dissenting members if Jerome Powell continues to hold rates steady. A lot can happen between now and the next decision on the 17th of September, but so far markets are pricing in a 25-bps cut with 90% confidence. #Apple #Altcoins #Inflation
