Another important set of indicators for the foreign currency trader
December 20th, 2010
Another important set of indicators for the foreign currency trader are international trade indicators. When a country is showing a deficit on its trade balance this is normally seen as an unfavorable sign as money flowing out of the country to pay for foreign goods and services may well devalue the currency. For the foreign exchange trader however fundamental analysis might well show that market expectations mean that in some circumstances a trade deficit is not at all bad. For example, some countries often operate with a trade deficit and so unless there is an abnormal rise in this deficit the currency will already reflect this fact.
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