2.1. Study of the assets or assets that we operate.
Today being the stock market opened 24 hours you must be very aware of what has happened in the rest of the world stock markets to follow the trend of the current trend for assets and markets.
Once we are clear about the situation of the Forex markets, we will have to see how find in relation to the Forex market of our assets. Let’s take as an example that we operate EURUSD and USDCAD, these assets have a strong correlation with equities respectively.
In the case of the EURO now it is following a positive correlation with the S & P 500 and the German DAX. We will then have to measure the maximums and the minimum of these three assets in order to be able to see what are the potential turn. It is also important to put in a separate chart the pivot points that, even if they have their detractors, in many cases are turning points and key levels for international traders.
Once we have measured the interesting points from a technical point of view, we will have to see how the fundamental study of data can affect our positions. It is recommended not being in the market before a strong data but in many cases, is no more choice. Another issue to consider is the emergence of the BCE, FED and FMI among others, given that the international situation is becoming more and more tense and can turn the market anytime.
We have to know when they will appear and on the subject to try to put another grain in the argument about our position. There is a curious saying in the market that says, “When he talks Trichet raises the bread” to this day when Draghi lowers interest rates.
2.2. Reading reports and graphs of interest
In addition to the possible readings we make to reputable analysts or other banks that do every day on the market is of high interest to have controlled the situation of volatility indicators, debt cost, CDS, open interest on assets, Dollar Index, put and call ratios etc. Why is it interesting to consider these assets? By a simple reason, are those that institutional operators look at in most cases for taking decisions. We can find these graphics in web pages as in bloomberg.com; in many the cases these assets influence what they operate so it is important to follow what they do the institutional ones as far as it can.
There are several services among many others that keep you informed in real time. One of them is FxPro Squawk which can be find in the news section of FxPro. In the first you can have a demo version with an offset of 5 minutes. These two systems what they do is filter the relevant market information and serve us on a tray. It is very convenient not to go crazy when looking for information. Another web of reference for a reading between trade and trade is forexlive.com. The information contained therein is basically only institutional and of high quality.
2.3. Trading Hours
Although the currency markets are opened 24 hours we have to take into account that in time slots about certain pairs there is much more volatility than in others. We run the risk of putting an operation in a time zone of low volatility and that we make us suffer more time than we would like to wait for something to happen that clearly does not It will happen.
We have to keep in mind that the time zone will be different if we are trading euro or we are trading AUD, NZD for example.
In addition, all the economic calendars mark the schedule of publication of news, so we can intuit what are the moments in which there is greater volatility.
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