One thing that is not a good idea for a currency trader is following the news. In this article, I am going to go through the announcement that the Mexican Peso (MXN) is expected to drop below 1 US Dollar for the first time in its history on the morning of November 8, and discuss how you can capitalize on this decision before it happens.
If you do not own any of the four major currencies, you have no idea what is happening. Some people who are doing a very quick math may have a lot of speculation, but the momentous event is what is really happening.
People who are watching this market and doing their homework will realize that most of the news has been bad news for the last few days. This is why it is important to be aware of everything you can in advance, and trade accordingly.
The news that is not bad, but may not be good, is usually the reason for the market plays. There is always a common link between the bad news and the direction of the movement of the market, so be vigilant when reading through these announcements.
In Mexico, there has been talk about the situation in the Middle East, and the possibility of the Gulf Cartel War coming to a head. The word “war” has changed the word “news” to “break”, so it is important to pay attention to the angle.
If you are looking for stocks that will move sideways or even move lower in response to the OPEC action, you will be disappointed. It is better to have a plan in place before this announcement is made, so that you can see the rally before it happens.
The cartel war would not matter much if it did not affect the oil prices, so the impact could easily be short-lived. Since this news comes a day after the RBA rate cut, the cartel war will likely effect the decision on interest rates and how the dollar moves.
However, if you see an event with news from one of the six major companies, then you know it will affect the currency. This is why it is important to keep an eye on the developing market as this announcement is made.
With this kind of news coming out every day, it is important to listen to the news before acting on it. There is a big difference between knowing what is happening in the market and being able to react appropriately.
The media wants to keep the price of the market, so they make very outlandish stories and have a lot of wild speculations. They do not really know what is going to happen, so they will pick up the news where the market does not want to go.
They do not want to be part of the news, because if they are, then they are going to lose their access to it. To avoid all the hype, you have to listen to the news before acting on it.