I am qualified to talk about this subject because I have traded using both fundamental and technical analysis.

So which one is better?

First let me share what these two types of analysis are.

Fundamentals, try to predict a currencies future price by supply, demand, interest rates, government policy, weather, underlying economic factors, etc. In part it does work if you are an economist and very, very good at it, but it will never generate the types of profits that technical analysis can.

The second down side to fundamental analysis is that it takes a lot of time and a lot of work. Fundamental analysis is what Big Banks use and they have whole office floors full of analysts and computer programs with all of the bells and whistles. We have seen what that kind of analysis has produced.

Technical analysis takes advantage of the fact that currencies move in trends 30% of the time.  It helps identify those trends and take advantage of moving prices.

Ultimately we don’t care what (if any) the fundamental reasons are for price movement, but that it is moving and we are capturing profit from it. Identifying trends is one of the most important things to learn.

Secondly we don’t care if price is trending up or down. We only care if we are in on the trend or not.

My system uses only technical trading because I know, not just believe, that the price already reflects all the known fundamentals. For example when a hurricane is approaching the U.S. Gulf coast oil prices start to go up. Because of the new fundamental knowledge of the storm the price already started moving up at the time the knowledge became available, not when the storm actually hit.

Most importantly even if somehow you magically knew all the fundamental information there was you would not know the market’s reaction to that information. If you knew all the reasons why the market was going to crash in 2008 you still would not know how far it was going to crash. With technical analysis my system caught a very large part of that drop in many currencies.

Now the important thing to remember about technical analysis is to not get what the professionals call “Analysis Paralysis”. Analysis paralysis is when you have so much going on that your signals are conflicting and you can’t make a decision. I only use six technical indicators in trending markets and 7 technical indicators in range bound markets and they all work together and never give conflicting signals.

If your portfolio is stagnant or dropping it is time to rethink your whole approach to the markets or at least diversify a portion to self trading.

One of the questions I get a lot is how much does the 5-10 minute per night trading system actually make? Well if you were trading a $44,000 account you would have made approximately $4,000 a month over the last two years. That means that every month you could have taken out on average $4,000 and you would have still made $4,000 a month.

Now not everyone is going to start out with $44,000 in their account so the easier way is for me to break it down by percentages. Our trading method has produced average returns of 7.21% per month only trading three currencies.

That sure beats looking at 40,000 stocks.

Please call or email my office anytime.

To your trading success,

Cecil Robles

support@ethostraders.com
www.adventforexcourse.com
If you have any questions please feel free to call my office:
Office Line – 866-200-1102 M-F 11:00am – 4:00pm PST

P.S. Be on the lookout for an invitation from me to a free webinar this month. I’ll be talking about some important topics for those that want to be top notch traders.