MACRO TRADING POST HOW TO
Watch the video to learn more about how to trade macro.Īnd as always, send any topics you’d like me to cover to and stay ahead of the markets, especially these choppy ones, by subscribing to our YouTube channel. Now, as for the last thing traders need to do when trading macroeconomic events, a lot of people tend to overlook this core asset… And it’s the biggest mistake a trader can make. You’ll also begin to realize just how much crossover there is when it comes to interest rates and currency. The more you start analyzing the biggest bond markets in the world - U.S., Japan and Europe - the more you’ll see how they all intersect one another. The next thing people need to understand when learning how to trade macro are interest rates. Or they may start looking into any commodities-based funds that have gold, oil futures or real estate assets. Watching the dollar against the other major currencies - like the euro, Japanese yen or British pound - can give traders an edge in developing a market strategy that keeps them ahead of the game.įor example, if a macro trader predicts the dollar will depreciate because of an upcoming recession, they may start buying mutual funds holding foreign stocks and bonds.
It’s the foundation of all macroeconomics trading.
Macro traders can buy or short stocks, bonds, currencies, commodities and ETFs.īut the biggest market in the world to trade macro in is the foreign exchange market, also known as forex or justFX for short - foreign currency.Ĭash rules everything around us, and if you want to learn how to trade macro the right way, then you have to understand the U.S. 3 Core Values in Understanding How to Trade Marco However, the most important thing to do when learning how to trade macro is understanding the universal assets that everyone looks at and trades. If the outlook is flat, traders could stay invested in cash or low-risk interest assets. For example, if the outlook for the Indian market is favorable, a macro trader could buy Indian stocks.Īt the same time, if the outlook for the Chinese stock market is weak, the trader can also short stocks in China and sell the country’s currency, the yuan. If the outlook is favorable, investors will buy assets that appreciate in current market conditions. There are three outlooks traders will have for the markets after all the analysis is done: favorable, flat or weak. They try to predict what the market is going to do next. There is no singular piece of data that is more important than the other because macro traders look for outliers and trends in relation to historic levels. Other important data points macro traders watch also include gross domestic product… home sales and builds… interest rate announcements and expectations… manufacturing… and shipping numbers.īesides just looking at economic data, macro traders also keep an eye on changes in politics… government policies… inter-government relations… and changes in global political relations - like right now, the war between Russia and Ukraine is having an effect on markets around the world. Macro traders look at major trends and economic data that’s happening on a global level, through all financial markets.īy analyzing certain economic indicators and data, investors can take advantage of patterns - like changes in inflation, interest rates or employment and unemployment rates - and attempt to find future opportunities. Trading macroeconomic and economic events is a lot like figuring out how to put together a 3D puzzle on how global markets interact and are correlated. It seems like everyone and their mother wants to learn how to trade macro - it’s one of the newest trends among traders.
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