6 Top and Pivotal Rudiments That Move the Forex Market
6 Top and Pivotal Rudiments That Move the Forex Market
The forex or prompt market is a dynamic global market that operates 24/7/365. It is a market where one country's currency is exchange for another country's currency. Actually, there are four major currency pairs traded in this market. In order to excel as a trader, you must have an absolute knowledge of factors that makes the market to move.This article highlighted the factors.
1. Economic data. The most important single measure is the gross domestic product. This factor has a great impart on the trading, the announcement of GPD will instantly change the direction of the market.
2. Interest rate. This is the main tool of the government in controlling the economy. High interest rate enhanced inflation and attracts foreign investors. Lower interest rate encourages domestic economic growth.
3. Intervention. Government intervene by fixing the value of its currency instead of floating. It is advisable to stick to dominant currency pairs. Intervention usually come without warning and cause the market to shoot up or down suddenly without signals from technical indicator.
4. Inflation. This is the general rise in prices in all sectors of the economy. It reduces the purchasing power of a currency compare to others. Government do track this using the consumer price index to monitor import, export and consumers spending.
5. Jobs. Employment rates reflect general economic health and are monitored and reported generally in each country. It is very important, you must listen to general news about job creations and unemployment rate in US and Europe (euro/usd).
6. News. The news has a significant effect on the currency market. Media are not predictors but followers, so keep the news in mind and see what is showing on your charts.