Forex Trading Mind

Last week was light on economic data releases, especially regarding the U.S. Dollar, which is typically the most important currency within the global Forex market. The highlight of the week’s releases for the greenback came on Friday, and the outcome was disappointing, reflecting poorly upon the underlying strength of the U.S. economy.

After taking a back seat while other major currency pairs stole the show with a fair amount of movement and volatility (yes, I’m looking at you USD/JPY), the GBP/USD came back into the limelight today as the Bank of England prepared to release its monthly Policy Report and interest rate. The price had been coiling up in advance of the release over recent days, stuck below the psychologically key 1.3000 level within a long-term bullish trend.

It is not always sufficiently appreciated that a large majority of Forex trading (something like 80%+ by volume) is conducted in other three currency pairs: EUR/USD, USD/JPY, and GBP/USD. Along with the USD/CHF currency pair, these are commonly known as “the four major pairs”, although in recent years there is more trading in the AUD/USD currency pair than in USD/CHF. You can do just fine trading Forex if you just stick to those three pairs as these are where most of the movement, volume and action is anyway.

Later today the Bank of Japan is going to issue its usual monthly Monetary Policy Statement, Outlook Report and Policy Rate. The Yen has been one of the most volatile currencies during the past few years, and there is good reason for that – it is because the Bank of Japan had a challenging task in trying to manage the Japanese economy with its monetary policy. Initially, it was all about letting the Yen depreciate, and inflating the economy back to health. This was followed by signals that the fall had gone too far. However, lately we seem to be arriving

Recent years have seen a new branch of the “Forex” world grow and take root, if I can mix my metaphors. That’s binary options, a type of trading different to “spot” which has always been offered by more traditional Forex brokers. The difference between these two types of trading tends to be confused. Both binary options and spot can be traded on the price of anything, Forex, commodities, CFDs, stocks, or whatever. The difference is how much the trader wins or loses depending upon the result. In “spot”, you trade the price itself, while in Binary Options, you trade a derivative of the price. For example, if you buy 1 lot of spot

Round one of the French Presidential election has got underway, with polls closing at 8pm local time with initial results due at about 9pm. Initial indications are that the turnout is high and set to surpass modern records at over 80% of eligible voters. My gut feeling is that this shows a worse than expected result for Le Pen is likely, the same way that an above-average turnout helped the center in the recent Dutch election a few weeks ago.

The first round of the French Presidential election will be held this coming Sunday, 23rd April. The electoral system here works as follows: the two candidates winning the most votes go into a second round, which is a straight fight between the two candidates.

In a surprise announcement today, which took political observers completely by surprise, the British Prime Minister Theresa May announced she would seek an early general election, to be held on 8th June. The next election had been scheduled for 2020, three years hence, but as the opposition Labour Party announced it would support the early election, the new date looks almost certain to be confirmed by the end of Wednesday 19th June.