If we look back at a daily chart over the past year, you will be able to quickly see the major political points that have highlighted 2016. The Brexit event in June created a 10% move in GBP/USD and a 4.5% move in EUR/USD, over a 24 hour period. In November, the US election brought us a 10% trend move in the EUR/USD. These surprising events have created great opportunities for both speculators and investors. If the first few weeks of the Trump Administration have taught us anything, it is that we can expect the unexpected.

Over the next few months, we can expect more comments on trade deals, border security, and immigration, not to mention financial comments regarding regulatory oversight and Federal Reserve policy. Each of these issues has the potential to provoke a market reaction similar to what we saw last year and we haven’t even brought up the possibility of using US dollar policy as a hammer.

Many feel that President Trump’s unorthodox style as a government outsider was a key reason why he won the election. His ‘shoot from the hip’ tweets will only lead to more surprises and create more volatility.

With all of this in mind, 2018 should bring increased volatility and opportunities for speculators, investors and especially retail brokers.

If you would like to discuss your trading and/or if you’re interested in starting your own FX brokerage business, please don’t hesitate to message me here or email me directly.

 

 

Fred Scala

fscala@Tripeak.com