Is It Smart to Trade on Forex During A Crisis?
The economic crisis we experience globally has been the main topic for discussion both among people who are involved in monetary activities and among the entire sectors of the population. It is so because each individual was affected by the economic catastrophes, one way or another. One may be afraid of inflation and salary cuts, and the other fears of losing a job. In this regard, what can we state about the forex traders and Forex Trading in Germany?
Traders are not exempted in these economic calamities, particularly since their work is linked directly to finances. Everything that occurs in the world of finances is undoubtedly reflected in the marketplace of foreign exchange. Perhaps, every broker at least thought about what is going to happen in Forex when a subsequent economic crisis strikes and how do they respond to such an extensive phenomenon.
Undeniably, any worldwide economic calamity for the trading marketplace doesn’t leave without a trace, both positive and negative results. Thus, it is vital to every broker to respond accurately to this economic turmoil and try to squeeze out from the circumstance only the benefits and make a profit.
Forex Trading in Germany, and worldwide generally is highly affected during this global crisis. Trading is very risky, yet is also actually extremely profitable at this time.
Advantages of Forex Market During Crisis
Market Hours are Continuous
Forex market is advantageous even at a crisis because this market is continuous. Since it is open 5 days a week, 24 hours a day, except only for holidays, that might affect your investment slightly. You can constantly go to the platform and make a market order.
Daily Gaps Frequency in Crisis Market
During market catastrophe, these breaks are more recurrent and often. But since forex is a continuous market, you have access to your investments 24 hours a day. You can make adjustments to your account; you are not subject to the sudden appearance of gaps.
Short Selling During Crisis
Major exchanges do not allow short selling in times of strong global crisis to avoid an excessive loss. You will not be permitted to capitalize in a short. Your only choice is to withdraw your position and stay uninvested until the end of the crisis. Short selling is not allowed because the trades do not want the drop in the value to hasten. It means that as an investor, you can only trade your position and be out of it, without the capacity to invest at the moment.
You can go either way when you are in forex. There is no shorting in forex. For instance, you purchase euro against dollar and then want to sell euro in turn, then you are just buying the dollar.
Capitalizing on Crisis in Forex Market
Whatever the condition of the market id, forex will be always available. You are always allowed to sell and buy whatever you like.
Washed Out Key Levels
Forex levels are more likely to break easily during times of crisis. Low level time frames will break since capacities will be stronger.