Just curious...what geopolitical news are important? I mean I know that US attacking iraq is a biggy, but what about minor ones that also affect currency...thanks
Just curious...what geopolitical news are important? I mean I know that US attacking iraq is a biggy, but what about minor ones that also affect currency...thanks
Ignored
Usually things that effect the political (and hence economic) stability of a region - for example, $/Cad usually gets interesting around election times; Eur/Usd was enjoyable back during the votes on the EU Constitution; more than unusual instability in Russia (or the former USSR) generally shows up in the euro; trouble in the ME can often boost CHF in a flight to safety, that sort of thing. Back when the war in Iraq was just getting underway, the USD would often jump on news of this-or-that Iraqi official or terrorist leader getting captured or killed. But traders usually have short attention spans...
(just to let everyone know; I put a Chat Room function on my site: Chat.GallantFX.com Specifically for news releases - you dont need to register but I think that a chat function will help the Group Mentality and benefit everyone....but who knows.....)
The news is a tricky thing - I used to look for the most volatile news reports to come out and then enter positions based on the first 2-3 minutes. I would say that there was a 50% success rate with that strategy. The mistake I was making was ignoring the FUNDAMENTAL data that came out with the report.
For example yesterday was a good example of Each:
UK ISN came out; the consensus was 55 and came out at 56 - NOT a big deviation, so go figure. But the USD is loosing strength across the board, so the Pound continued its rally, and continued up ~80 pips over the following hours.
Then Aussie Retial made its way out; consensus was 0.7% and it came out WAY below at -0.1%.....(now this one moved very fast) and it moved ~35 pips against the AUD for the mentioned reason.
Even NF payrolls are subjective to Fundamentals - where if the revisions are far off the market, it will cause the actual data to not hold any water.
I would say, there are 2 factors in determining the price movement:
1. Current Price/Technicals - and how it looks against its moving average and how the first few minutes look against the indicators.
2. Fundamentals - the deviation of the report from the consensus.
its an interesting study... from my observations most of the announcements are pretty consistant. there are only a handfull of instances in the past few years where a news announcement has caused the market to move in the direction opposite to what you would expect it to do.
Also mabye even more interesting than the direction these news announcements cause is the volume. it seems that about 60 - 70% of the total market volume is traded during the times of these announcements.
