Which trading strategy involves predicting currency movements during scheduled economic announcements?

The trading strategy that involves predicting currency movements during scheduled economic announcements is fundamental analysis. This approach focuses on evaluating economic indicators, news events, and other macroeconomic factors that can influence currency values. Traders who use fundamental analysis pay close attention to economic reports, such as employment figures, GDP growth, and central bank decisions, as these can significantly impact market sentiment and currency volatility.

By analyzing these announcements, traders can make informed predictions about how they will affect currency pairs. For example, if a country's economic data indicates strong growth, traders may anticipate an increase in that currency's value. Understanding the context of macroeconomic conditions allows traders to position themselves effectively ahead of these announcements and potentially capitalize on anticipated market movements.

In contrast, technical analysis relies on historical price data and chart patterns to make trading decisions, day trading focuses on short-term price movements within the day, and scalping involves making numerous trades to profit from small price changes. While all of these strategies can be used in the foreign exchange market, fundamental analysis is specifically geared toward anticipating market reactions to economic news and events.