The most important factors that drive the market are: politics, economy and Speculation. A trader should base his actions on these factors.
Politics includes speeches of officials of various ranks. These speeches should be analyzed in order to find explicit and veiled hints about possible developments, which could turn the markets upside down. For example, a possibility of another war for influence over the oil; all sorts of arrangements between the countries regarding to the retention of the currency corridor for long-term trade between them; warning about new “policies”, i.e. the strengthening or weakening of the national currency. This paints a certain picture of the views of governments on markets. One can make a lot out of this. If a trader wishes to stay on the market for some time, he should never neglect the analysis of political trends.Economy often comes hand-in-hand with the politics and it is not surprising at all. Government represents the power of the state, but it relies on the economy. If government policy is contrary to the requirements of the economy, there might be a split that threatens with destruction.

Therefore, the statements of various representatives of the economic and banking spheres are very interesting. Try to keep track of records of companies and banks, and projections on their statements. It is understandable why they have such a strong influence on the stock index and Forex Quotes. It is important to follow current events, keep track of news on mergers and acquisitions, buying and selling of major companies etc.

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