How to use an economic calendarIt will not tell you which way to trade. What it tells you is when the market is about to become a different market, which is more useful and much less often acted on.Fundamental vs technical analysis
The long-running argument about which one works is a category error. They answer different questions, and a trader with a view still needs an entry, a stop and a size.
Fundamental analysis looks at the conditions that determine what something should be worth: interest rates, inflation, growth, employment, central bank policy, company earnings.
Technical analysis looks at what the price has been doing: trend, support and resistance, momentum, volatility, patterns in the record of trading itself.
Presented as rivals, they are better understood as answers to two different questions, and a complete trading decision needs both answered plus a third thing neither of them provides.
What each one is actually for
The useful distinction is not accuracy. It is which question each is equipped to answer.
Fundamental analysis asks why
Why might this market move? What has changed in the conditions underneath it?
Strongest over longer horizons, where economic reality has time to assert itself against noise.
Genuinely explains things: monetary-policy divergence can drive a currency trend for a year, and no chart pattern accounts for that.
Weakest at timing. You can be right about the economy and six months early, which in a leveraged account is indistinguishable from being wrong.
Hardest problem: working out how much is already in the price.
Technical analysis asks what
What is the price doing now, and where would I be proved wrong?
Strongest at structure: it produces an entry, a stop level and therefore a position size.
Works identically across markets and timeframes, and can be tested against history and automated.
Weakest at explanation. It cannot tell you a central bank meets on Thursday, and every level it identifies can be overrun in seconds by information it has no access to.
Hardest problem: two competent analysts read the same chart and reach opposite conclusions.
Notice that the strength of each is the weakness of the other. That is the actual argument for using both, and it is a better one than either camp's usual case.
Correctly forecasting an economic release and correctly forecasting the market's reaction to it are two separate problems.
Indicators are arithmetic, not information
A moving average is an average of past prices. RSI is a calculation on past price changes. ATR is a measure of past ranges. Every indicator on a chart is a transformation of data that was already there.
None of them knows anything the price does not. They reorganise it - sometimes into a form that makes a pattern easier to see, which is a real benefit and a modest one.
This matters because indicators are often treated as independent opinions. Stacking RSI, MACD, stochastics and three moving averages on one chart does not produce five views. It produces five arithmetic operations on the same series, all lagging, frequently disagreeing, and creating a strong impression of thoroughness.
The two ways people go wrong
Confirmation bias is the shared failure. A trader decides EUR/USD must rise, then notices the bullish pattern and the soft US data while somehow not noticing the resistance level and the hawkish central bank comment. Both methods supply plenty of material to be selective with, and neither has any defence against it.
Analysis paralysis is the other. Twenty indicators, thirty releases, six timeframes and a news feed will always contain a reason not to act, and always contain a reason to act. The problem is not insufficient information.
A framework that uses both
Fundamentals set the direction, technicals set the structure, risk management decides whether the trade happens at all. Roughly in this order.
Establish the environment
Is this market trending or ranging? Is volatility high or low relative to its recent normal? A strategy built for one regime performs differently in the other, and this is the cheapest check available.
Find the fundamental theme
What is the market currently trading on: rate divergence, inflation, growth, risk appetite? Is major data due before you would expect to be out?
Read the structure
Where is the trend, where are the levels that matter, and specifically: what price would tell you the idea is wrong? That last one is the entire technical contribution to risk management.
Convert it into a size
Stop distance and account risk together give a position size. This is the step where an opinion becomes a trade, and it is arithmetic rather than judgement: see [position sizing](/insights/strategies/position-sizing/).
Check the trade against everything else you hold
If three open positions all depend on the same currency moving the same way, this is not a fourth idea. It is more of the first one.
Record what you did and why
Not the outcome: the reasoning. A method can only be evaluated across a meaningful number of trades, and only if you can still reconstruct what you were thinking.
What brokers give you to work with
Both toolkits are effectively universal across our hundred records, so neither is a reason to choose a broker. What varies is depth.
- 100of 100 offer research or analysisTrading Central and Autochartist recur constantly across our records.
- 30-38built-in indicators on MT4 and MT5The standard platform loadout. The ceiling is not the constraint on anybody's analysis.
- 400+the widest charting offer we recordedFxPro, via TradingView integration. Whether more than 38 helps is a separate question.
Which matters more, by holding period
The balance shifts with how long you hold. It never goes to zero on either side.
| Holding period | Where the weight sits |
|---|---|
| Minutes | Almost entirely execution and structure, but knowing when a release lands is critical, because that is when spreads and slippage change. |
| Hours to a day | Structure for entry and exit, fundamentals for the day's theme and the scheduled events. |
| Days to weeks | Genuinely both. Positions live through data releases, so the fundamental picture has time to matter. |
| Months | Mostly fundamentals: policy cycles, growth, valuation. Technicals still decide entry, exit and where the thesis is wrong. |
Before entering
Two fundamental questions, two technical, two neither. If the fourth has no answer, there is no trade.
- What is this market currently trading on?
- Is significant scheduled data due before I expect to be out?
- What is the trend on the timeframe I am actually trading?
- What price proves this idea wrong?
- What position size does that stop distance allow?
- Does this duplicate exposure I already have open?
Common questions
Which is better?
Neither. They answer different questions, and most working methods use elements of both plus a risk framework that belongs to neither.
Can technical analysis predict prices?
No. It describes behaviour and identifies structure. Anything presented as prediction is being oversold.
Can fundamental analysis predict prices?
Also no. You can be right about an economy and wrong about the market, because the market may already have priced it or may be trading something else entirely.
Do I need lots of indicators?
No. Most are calculations on the same price series, so adding more produces correlated signals and the appearance of confirmation rather than genuine independent evidence.
Does RSI above 70 mean sell?
Not on its own. Strong trends routinely hold elevated readings for extended periods.
Do chart patterns work?
They fail regularly, and any pattern is obvious in hindsight. The useful test is whether your rules were written before the outcome was known.
What is confluence?
Several factors pointing the same way. Genuinely useful when the factors are independent, and misleading when they are three versions of the same calculation.
Can algorithms use fundamental analysis?
Yes. Automated systems trade economic releases and news directly. The split between fundamental and technical is not the same as the split between human and machine.
What is confirmation bias?
Noticing the evidence that supports a view you already hold and discounting the rest. Both approaches supply ample material for it, which is why writing your reasoning down before the outcome is the only real defence.
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Other relevant articles
How to use an economic calendarIt will not tell you which way to trade. What it tells you is when the market is about to become a different market, which is more useful and much less often acted on.
What volatility does to your position sizeThe same one lot can risk $200 in a quiet week and $800 in a busy one. Nothing about the trade changed. The market did, and the position did not follow.
Risk management: the whole accountSizing one trade correctly is arithmetic. Keeping an account alive across a hundred of them is a different job, and it is mostly about the losing streak you have not had yet.