Forex is a global market that is controlled by the world people. It is not controlled by one authority as it is impossible to do that. This market has spread worldwide and you will find that even a small change in the world events can make this market volatile. This article will tell you some of the global events that are not related to this industry in our eyes but can have an effect on the market trends. We are only focused on the trends and patterns, strategies and volatilities that we forget the events behind the changes. When you go through this article, you will find that there are many global events that can make this industry volatile. Those who consider trading as their full-time profession, always trade the market with managed risk. Managing your risk is the most crucial things in currency trading profession. In order to find the best trades, you must develop a balanced trading strategy. Those who are new to this market often ignores the fundamental factors. Fundamental factors are often known as the most powerful price driving catalyst in the investment industry. Let’s give you a simple example to make it clearer. The FED officials hike their internet rate, we will see a strong surge in the U.S dollar index. This will eventually fuel up the dollar bulls as a result U.S dollar will trade higher against most of its major rivals. You need to incorporate fundamental analysis with your technical data. Unless you have a strategic plan to trade the fundamental and technical factors of the market, it will be really hard for you to deal with the dynamics of the market. Being new to this investment world, you should never trade the market with real money. Open a demo trading account and try to master the art of currency trading profession. Demo accounts are often considered as blessings for the new traders as it helps them to learn more about this market. And use the fundamental factors to fine tune your trading strategy. Political impacts on industry First, we will discuss the political impacts. Politics is very important in our economy because it is how one government comes to power by winning the political contest. In this political process, new parties come to the governments and they also made new fiscal policies or bring change to the existing policies. If the fiscal policies are to favor the people, they will save more and the investment will rise. The rise in the investment will increase the value of the currency and the currency will be strong with its pair. If the political events are not favorable, the economy can decline and make the market and the prices go down. New governments will have new policies to increase the economic growth which will, in turn, improve the currency’s valuation. A good political impact can improve the market conditions when you are trading. Impact of natural disasters As the trends of this market cannot be predicted even with the best strategies, the natural disasters are also hard to forecast. These natural disasters can affect the industry badly. When there are Tornadoes, Tsunamis, and floods washing away a nation, the economic condition gets volatile. The government spends money which could have been used for investment purposes. This is one of the reasons the US has the strongest and traded currency in this industry. The dollar made up more than 80 percent of the transaction in currency trading. The US has a strong government and they can overcome any natural disasters sooner. Man-made disasters Wars can even change the currency of the nation. For example, after the Second World War, the Bretton Woods system was implemented and the wealth of the countries was measured in gold. Countries which are in a war with other countries have poor economies and their pairs are not traded much in this market.
