The slight kerbing of inflation due to low fuel prices should have been welcome news to consumers, but it turns out this inflation dip has actually weakened the pound even further.
Low fuel prices see pound dip
It was revealed that inflation had dropped 0.3 per cent in the last month. This was caused by lower fuel prices, which took a little pressure off consumers. Or so it was thought, but the announcement actually saw the pound drop even further in value, due to worries that this news would harden the Bank of England’s stand on holding interest rates where they are.
A volatile market
For the past few months, our traders have been saying the same thing over and over – Avoid trading on the pound. It’s volatility, showcased by this latest drop, is all the proof anyone would need to say that trading on the pound could be a headache.
For those who insist on trading in a volatile market, it’s imperative that they have a robust risk management system in place. If they were to trade without a stop loss and a currency shifted as the pound did, they could lose a lot of money. A stop loss can protect more than 98 per cent of your trading fund.
Finding the right trades
For those who can see that a volatile market is a dangerous one, it’s all about finding the right market to trade in. SmartCharts software will pull in all the data, analyse the results and select the markets that are the most likely to make a profit. It will select the ideal in and out points, and automatically put a stop loss in place to protect your money.
Learn to Trade
If you want to find out how to safely trade on the Forex market, then you should learn from the best. Learn to Trade is the UK’s number one Forex Educator. Come along to one of our free Forex workshops and discover your path to financial freedom.