The fundamentals give us the reasons: Russia/Ukraine unrest, Interest rates, Inflation, Supply chain disruptions, COVID fears….these are some of the reasons why a currency will move/trend in a particular direction. And these reasons will dictate supply and demand, which will determine the trend direction.
But as a technical trader I am more concerned with the WHEN and will use our technical indicators to evaluate the price, the current price in relation to where it was and – how did it get to current live price. As we analyze the charts, we will select a timeframe and this will determine how far back we apply our technical analysis – days (daily charts), hours (hourly charts), minutes (five minutes, thirty minutes) and apply the correlation between the timeframe and how long we anticipate a trade setup to last – minutes, hours, or days.
So, although there is nothing wrong with an understanding of the fundamentals and how these factors influence the market, I believe they can often blur our decision-making process as a technical trader. Fundamentals’ effect on the market are often subjective. Price is everything to a technical trader and experience teaches us to trust our charts, technical signals and act on objective facts.