Forex is a broad market, and many variables can influence the currency pairings that exist inside it. Here are a few examples:

Political events :
The value of a currency might fluctuate due to political events such as corruption, presidential elections, government instability, and so on. For example, when former President Donald Trump was elected, the value of the dollar rose.
Economic policy:
Economic policies are included in fundamental analysis. The majority of forex traders keep track of a country's GDP, fiscal and monetary policies, and unemployment rates. These factors can have a substantial impact on the value of a currency. The events listed on the economic calendar may also have an impact on the financial markets.
Technical Analysis:
Forex trades are influenced by a variety of variables such as trends, price levels, and indicators. Most technical traders value the aforementioned factors and utilise them as the foundation for trading decisions.

Currency pairs are influenced by a mix of economic, political, and market-driven factors. Interest rates play a major role, as higher rates tend to attract foreign capital and strengthen a currency. Economic indicators such as inflation, GDP growth, employment data, and trade balances also shape investor confidence and currency demand. Central bank policies, including monetary tightening or easing, often cause sharp price movements. Political stability and government decisions matter because uncertainty can weaken a currency quickly. Market sentiment and risk appetite influence whether traders prefer safe-haven currencies or higher-yielding ones. In addition, global events like geopolitical tensions, natural disasters, or financial crises can trigger volatility. Finally, supply and demand dynamics, driven by international trade and capital flows, continuously affect how currency pairs move in the forex market.