How do you blend fundamentals with technicals?

Fundamentals give direction and conviction; technicals give timing and risk. Blending them is the holy grail and the source of endless confusion — especially when the two disagree.

How do you blend fundamentals with technicals? — central bank rate path diagram
A central bank's policy rate path across recent meetings

What's your blend?

  • which comes first in your process
  • what you do when they conflict
  • the trade where the blend worked best for you
How do you blend fundamentals with technicals? — risk-reward diagram
A risk-reward ratio of 1 to 2

The interest rates guide is the fundamental side's core text.

Background: How interest rate decisions move currencies

Central bank decisions are the biggest scheduled events in forex. Why rates matter, why a hike can weaken a currency, and what to read beyond the decision.

Does a rate hike always strengthen a currency?

No. If the hike was fully expected, it is already in the price. The currency can even weaken if the central bank signals that it won't raise rates further.

What does hawkish mean?

Leaning towards higher interest rates to control inflation. A hawkish surprise usually supports the currency.

Read the full guide

Comments

Log in to join the discussion. Comments follow the community guidelines.

Log in to comment

Loading comments…