A forecasting approach that uses recent exchange rate movements to predict the direction of future exchange rate movements is called ______.
A) expert analysis
B) fundamental analysis
C) market-based analysis
D) technical analysis
E) temporal analysis

Question

Quizplus · Accepted Answer

The forecasting approach that uses recent exchange rate movements to predict the direction of future exchange rate movements is called technical analysis. This approach relies on statistical trends and chart patterns to identify potential future movements in currency prices. It does not consider fundamental factors such as economic indicators or expert analysis. Market-based analysis is a broader term that encompasses both fundamental and technical analysis. Temporal analysis is not a widely recognized term in currency forecasting. Therefore, the correct answer is D) technical analysis.

A Forecasting Approach That Uses Recent Exchange Rate Movements to Predict