Politics can produce a significant reaction to its exchange rate as it affects a country’s business sphere. Suggesting the optimal time to open positions political developments can significantly push the trading of binaries and CFDs very often.
Events of the first priority for bidding
The predetermination of the economic sphere can be done by the following essential political developments:
- Elections;
- Revolutions;
- Impeachments;
- Death of state leaders;
- Etc.
It can be the reason that cause any state and globe instability.
It can be the disadvantage for bidding and is impossible to catch the exact moment of data publications. Plus point with this is that the traders with extensive experience can use this data as bidding means at a certain point.
As the political development push the financial sphere it does not necessarily mean that there will be a decrease in the price of assets. The risk can have a positive consequence in the growth of GDP and significantly increase corporate income, which means that the cost of shares will increase.
The main thing is the time to catch the difference in this case.
Distinctive features of political risk is the main thing that every bidding agent who wants to make excellent money on binary trading, should be aware of.
Consider an example of Brexit referendum on the 23rd of June 2016, took place in the world UK. As the result, British economic sphere and the British Pound is impacted by the British vote. The UK`s exchange dropped 10% against the dollar and reached its thirty-one year low on the night of the vote.
Unexpected developments to impact bidding strategy
There are also unexpected developments, not necessarily political ones, that predetermine markets too. They may include natural disasters:
- Terrorist attack;
- Earthquakes;
- Tsunamis;
- Droughts;
- Etc.
Do not forget that the market reaction on the unexpected breaking news is usually much stronger than on the schedule data releases.
Have a nice bidding experience with IQ intermediary!
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