Forex Trading Mind

During yesterday’s New York session, President Trump did an interview with Fox News in which he said a couple of things that the market took notice of

The Forex market was quiet today, which wasn’t a great surprise as there wasn’t much news scheduled. There was a reasonably large movement late on Monday, and these days the Forex week is often characterized by just two big moves. In fact, traders probably make 90% of their profits from these one or two big moves each week, but that’s a subject for another time.

The Forex market spiked during last Friday’s Asian session, when news came through that the United States had conducted a military strike against one of the Syrian government’s airfields. The justification given by President Trump for the strike was the belief held by his administration that an attack on civilians using chemical weapons had been conducted from that airfield a few days earlier. The attack marked the first ever direct military engagement between the United States and Syria.

In yesterday’s posting, I anticipated how the market might react to yesterday’s US economic data and the minutes of the most recent FOMC meeting. One key element which I highlighted was how the minutes might be seen to strengthen the likelihood that the Fed will shrink its debt program, which would then decrease the odds of a rate hike. Lower future rates make a weaker U.S. Dollar more probable, logically speaking.

I find myself writing this piece again and again every few weeks. I hope I’ll be writing it again a few weeks from now, because if I do, I’ll have made some money being long of major U.S. stock market indices such as the S&P 500. If you don’t understand what the hell I am talking about, then please bear with me for just a little while longer.

As someone who writes about Forex and trading for a retail audience, it makes me angry how much rubbish is written on the subject, giving all of us a bad name.

Economic data released by the British government earlier today showed that the year-on-year consumer price index has risen by more than 2%: 2.3%, to be precise.

Wednesday was an important news day: the U.S. Federal Reserve hiked rates by 0.25%, as had been widely expected. The surprise came in Chair Janet Yellen’s comments, in which her willingness to allow an annual inflation rate greater than 2% for some unspecified future period produced a widespread sale of the U.S. Dollar, with the market rightly seeing this as making the total rate raises over time most probably lower.