To profit in currency market one needs to watch the news and take notice of the political developments. The political news seems to matter more in the foreign exchange markets than anywhere else, as it moves currency almost as if it is a living breathing entity.
For example, the Pound took a ten percent hit right after the Brexit vote. When Macron was elected the next president of France, the Euro dipped a couple of percentage points. It's a fickle market, or reactive. Currency market is especially responsive to elections and votes of significant political action according to Laurens Maartens from the NBWM (the Dutch Payment and Exchange Company),
During currency market event organized by foreign exchange traders to look back on the first 100 days of President Trump's time in office was another prime example when currency hedge funds got together just to talk about this important event as far as foreign exchange market is concerned. Such event-driven movements, especially elections and votes, tend to stir the market into big waves of change, while economic statistics were not as influential as anyone would think.
If on the other hand, the figures that are revealed give rise to some current event happening, then it would possibly be more likely to move currency markets. Otherwise, it's almost as if nothing happened according to Laurens Maartens. Though, curiously, there were few if any reactions in the Forex market following the results of the Dutch elections, and as well French presidential elections with Marine Le Pen were losing.
The reason it is worth pointing this out is that to the foreign exchange market it must have been more like a statistic, and less likely to have large-swaying consequences. For currency traders, that's great news, especially if they are trading a handful of different currencies in their day-to-day trading activities.
So far Comey's firing from the FBI post has not moved the foreign exchange market, though the potential for the Federal Reserve to increase rates come June seems possible. Of course, that's been hinted at for ten years now. Meanwhile, the European Central Bank is filling the market with billions of Euros.
For the Netherlands and Germany, the massive influx of money should result in growth. It's expected that the Dollar-Euro currency exchange rates will swing up and down between 1.05 and 1.10 level.
Of course, while the facts and figures of the official government reports have little impact on the face of currency trading, what people "think" matters the most to currency market Keeping this in mind currency traders are looking at finding out what people overall are thinking. This matters more than the government putting out figures.
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