11 February, 2014
Are Forecasts Reliable?
Forex forecasts, or, speaking more precisely, their accuracy influence the prediction of possible income and risks. Forecasts do help in trading; they are a trader’s weapon in a mission to conquer the volatile and unpredictable currency market, because the probability of winnings pretty much depends on whether you know what affects the rates. Foreign exchange has seen various ups and downs, making a forex forecast is a difficult task with a variety of possible outcomes. Making daily and weekly forex forecasts is both useful and very risky. Moreover, it is difficult, so only people with enough expertise and knowledge can do that.
Traders who constantly keep an eye on the analytics might agree that forecasts provided by different sources (e.g. FXCM, Forex.com, NordFX) may be dramatically diverse.
Does it make sense to take forecasts into consideration and to believe in them? How to make money on forex forecasts? Yes, it definitely makes sense; however, there are some arguments against it too. First off, the forecasts are generated not by prophets or paranormalists, but by people no different from you or thousands of other traders. The only difference is that they possess in-depth knowledge and experience. Traders who constantly keep an eye on the analytics might agree that forecasts provided by different sources (e.g. FXCM, Forex.com, NordFX) may be dramatically diverse. And the reason for that is not the incompetence of the analytics: stupid and incompetent people do not make forecasts; the fact is that different analysts use different instruments and approaches in the market research.
Any trader willing to trade profitably can learn to make forecasts, once he has understanding of the market, – and he can do it same good as the analysts of the major forex companies.
However, you have to remember that forecasts should always be compared to others’ findings, because an individual can miss or ignore something. Before you make any trading decision, you need to have a full picture, and not just take the data of one forecast for granted.
You can find forecasts on the Internet resources, but 100% accuracy can be guaranteed by neither of them.
How to read forex forecasts and benefit from that?
Forecasts have to be taken into consideration; use them not as a primary trading method, but as the one to help you make a decision in a difficult situation. Many companies offer analytics to their customers as a subscription. There is a list of forex brokers where you can choose an appropriate brokerage; binary brokers are also on the list. Correct forecasts are particularly helpful in binary options trading. You can find forecasts on the Internet resources, but 100% accuracy can be guaranteed by neither of them. Another option is to find a broker who offers free analytics or trial forecasts so that a customer is able to decide if the company is accurate enough in its market estimations. It is not a problem to find a ready forecast on the Web or at the broker’s, the most important thing is not to rely solely on it.
When investing make a decision based on a number of options, compare data from several trusted sources: you are investing in your own future and well-being of your family, so work well to achieve your goal. Don’t let your future and successful trading on the forex market depend on the judgments of just one person. A trader is a profession, so you have to perfect yourself, to learn more about analytics so that you understand forecasts and can realize how true they are, to calculate the probability of hitting the target.
Thus, do not let your future and success on the foreign exchange market depend on the estimations of just one person.
Professionals engaged in forecasting won’t spoil their reputation with knowingly false forecasts; on the contrary, they try to make their data as precise and close to the true future of the market as possible. Traders take forecasts differently: some of them believe in them, some don’t; some test them and some generate forecasts of their own. There is no single answer as to whether or not to trust forecasts; decisions on the market have to be taken continuously, and only you decide which way to act in any particular situation. Combine trust in forecasts with personal findings and verification of analytical data as much as possible.
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