Top-down analysis in Forex starts with the bigger picture — such as analyzing the global economic environment, central bank policies, and major market trends — before zooming into specific currency pairs on shorter timeframes like H4 or M15.
Why It's Powerful in 2025
✔️ Aligns with major market flows
✔️ Reduces false signals and random entries
✔️ Helps traders understand the full market story
Watch This Strategy in Action
Step-by-Step Guide to Apply Top Down Analysis
Start with the Monthly Chart: Identify the major trend and support/resistance levels.
Move to the Weekly Chart: Look for trend confirmation, chart patterns, and market structure.
Daily to 4H Chart: Time your entries using price action or indicators like RSI, MACD.
Entry Confirmation: Use candlestick signals or break/retest to execute low-risk trades.
Real Examples (Live Charts Recommended)
You can apply this strategy with pairs like EUR/USD, GBP/JPY, or AUD/NZD. Combine technical and fundamental analysis for best results.