One of the trending topics in international affairs is the drone attack on Saudi’s oil plants. Although this issue has many aspects including political, military control, etc., knowing how it can impact the market is critical to understanding the trends. Commodity trading is the most profitable sector in Forex and includes oil and gold. High risk involves high rewards, and that attracts millions of investors around the world. As the USA may intervene in state affairs, this can lead to further instability in price. In today’s article, we are going to discuss the probable consequences that may result from this attack.
Choppy trends for a few weeks
Until the dust settles, expect that there will be choppy variations of price. Oil and gold in the international market are highly dependent on the source availability. Although major currency pairs can be understood easily due to the abundance of information, this is not the case in this aspect. Already, international countries are having discussions on how to upgrade the sophisticated defense system. From the latest announcement of a Saudi minister, Arab is fully committed to taking revenge.
All these news have created panic, thus unpredictable movement may appear. Many policy strategists believe this will open the chance for western countries, particularly the USA, to establish control over oil regions. This may result in destroying the economy of Arab. For commodity investors, the best advice is to halt trading during this period. This matter has got the attention of international media, do not place a trade until this dispute has been settled. In the meantime, learn other pairs in Forex. If you are familiar with different types of pairs and trading strategies, this disadvantage can become a benefit. Try the learned methods to see if you have any chance.
Dealing with global issues
Those who are trading the Forex market must keep themselves tuned with the high impact news. Some experienced Aussie traders often consider the fundamental analysis as the most important parameters. Fundamental data are more like indicators. It gives a clear signal about the market condition. At times things might become messy upon sudden attack or threat from the leading countries in the world. Unless you have extensive experience with such market condition you should never trade with the real market. Most of the time the market exhibit random movement and it becomes very hard to trade with tight stops. Let’s dig deep and learn the impact of sudden global issues on the financial market.
A shake in economy
The most immediate impact will fall upon the global economy. As long as there has been no improvement, it is hard to predict the future. An example is the choppy trends we have discussed above. Oil supply is related to everything, so currencies may also take a hit. As the dollar is paired, we can expect the volatility will remain under control. However, it is wiser not to invest. Don’t try to act smart by pulling off tricks. If you are confused, observe the professionals. If they have taken extra precautions, take a break from trading. When experts are worried, it is better not to take chances.
What about minor currency traders?
This market involves only a few selected countries. They are free from international influence and investors can expect to have stable volatility throughout the year. Less volatility means less chance but still, the future is unknown. To get the right idea, we suggest communicating with people from different sector to know the present situations.
This article is written only educational purposes. Do not think the impacts are inevitable as interventions can mitigate the issue. The best solution is to hold onto invest. It is extremely risky to make the right decision. New issues will emerge, investors will forget and once again, the price will be on track. Wait until the opportunity arrives. Keep an eye on the international economy to understand the changes. Read the newspapers to stay updated.