How does ForexGen fundamental analysis explain short term trends?
Fundamental analysis can also explain short term trends. By keeping up to date with economic data, rumors, and news, a fundamentalist can better forecast short term trends since these are all factors that affect currency pricing.
For example, the USD/JPY stayed high throughout May 2003 due to fears of intervention by the Bank of Japan.
Another example is when the European Central Bank stated that the dollar would inevitably fall, causing the EUR/USD to rally 200 pips on October 6, 2003.
ForexGen have two major pitfalls of conventional rule-based trading systems are the need for an expert to provide the trading rules and the difficulty of adapting the rules to changing market conditions.
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