Basic economic parameters, such as inflation, interest rate and unemployment rate, have always had a great influence on exchange rate fluctuations. Government policies and guidelines also have an important impact on the exchange rate. Trust in the ability of the government cabinet is conducive to maintaining a strong exchange rate. The reduction of interest rate stimulates the reduction of money demand and reduces its value in exchange operations, which is beneficial to the exchange rate. The decision of the national central bank to buy or sell foreign exchange can also decisively stabilize or weaken the exchange rate.

The expectation of changes in the economic situation will lead to sudden and violent fluctuations in the exchange rate. This is very important, because in many cases, the foreign exchange market is controlled by the expectation of changes in the economic situation, not the changes themselves.

The behavior of professional foreign exchange operators, especially when a large consortium pays attention, is also an important factor affecting the market. In many cases, professional operators can operate independently and use the market as a unique tool to change major exchange rates to achieve their goals. Most, perhaps not all, of these manipulators may not pay much attention to the coordination between the technical analysis chart and their own goals.

However, due to market resistance or the proximity of major support levels, market actions have become more technical. Most traders' reactions are usually similar and predictable. Such a market cycle may lead to sudden and violent price fluctuations, because a large amount of money is suddenly invested in similar parts.