The market moves because of supply and demand, but forex is a manipulative market. Banks, especially central banks, have the power to influence the forex market because they control more than 50% of the forex market.
Central banks and financial institutions have the power to influence the forex market. Their decisions can have a huge impact on the price. However, factors like geopolitics, monetary policies, disasters, and social and economic events also influence the market.
Through monetary policy, exchange regime setting, and, in rare situations, currency intervention, central banks have a significant impact on FX markets. In total, there are 8 central banks that control their local currency through monetary policies.
Yes, the market is driven by big players and fundamental news and events. Therefore, fundamental analysis is a very important part of trading.