[Art Krantz]

Fear & conjecture (psychology) rule these instruments. They’re acutely sensitive to news flow of any color or creed.

Most of the ongoing chatter regarding:
interest rates
economic gauges (inflation numbers, foreign money inflows-outflows, housing, jobs data, blah blah)
central bank activity (& whispers)
global imbalances etc, constantly whip up the volatility & pitch & toss them around to intra-day & intra-week fair value camps.

Technicals are merely your weapon of choice to price & balance the fundamental biases which pop the pairs/crosses up & down the chart map day after day.

If you can get in tune with the psychology of the market - keep one ear on the fundamentals & the other one on the technicals, you got yourself an even chance of pulling serious dough out of this circus.

Players are constantly pricing in the fundamental flavor of the day as the relevant item of chatter/news hits the market. Your job is to interpret & grade it depending on importance or relevance & match it up with your technical grid/trade plan.

Sometimes, you’ll get an aggressive pop to the upside/downside, or an out of whack move, which is specific to a particular currency at that time.

If you know what you’re looking for (unique fundamentals) you can work the short-term strength/weakness of that specific currency to your benefit.

These instruments are awful fickle, as are the participants. But generally they’re pushed & shoved around by the currency packing the heaviest muscle. In other words, trade what’s in front of you now, not what might occur in a couple days/weeks.

Buy the strongest, sell the weakest is a simple, effective game plan to wrap a strategy around. Pure common sense (a trait severely lacking in most traders) will also be a good friend when navigating these waters.