Market News:
Technical analysis is a powerful tool in trading, but it does not explain everything. Currency price movements are driven by deeper forces formed by supply and demand, liquidity, economic events, and central bank interventions. Let’s break down price action from its true foundations.
Candlesticks on a chart show us the final result of price movement, but the real force behind price action comes from:
Market liquidity
Movements of major participants (banks and institutions)
Reactions to economic news
Technical analysis shows you what price did in the past, but it does not fully explain why price moved the way it did.
In the forex market, there is no traditional centralized exchange. Price is formed by the balance between buyers and sellers at any given moment. When buyers outnumber sellers, price rises — and vice versa.
This is where liquidity and execution systems become critical, as they determine how many buyers and sellers can enter the market without causing sharp price disruptions.
Economic events such as growth data, inflation reports, interest rate decisions, and geopolitical tensions directly influence currency supply and demand.
For example, strong economic data can increase demand for a country’s currency, pushing price higher — often beyond the range suggested by standard technical patterns.
Technical analysis does not ignore news, but it often does not effectively integrate it. When major news events occur, price frequently moves faster and further than technical projections suggest. This happens because the market is repricing assets based on new information.
Platforms such as MT5, available at Point Trader Group, display real-time prices and execute orders based on available liquidity and live spreads.
This means price is not just a number on a chart — it is a direct reflection of current market forces and real liquidity depth.
Technical analysis is a tool, but it is only part of a bigger picture. Actual currency price movement depends on supply and demand, liquidity, economic news, and real market depth — all of which traders must understand alongside technical analysis.
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