Cross Euro Polish Zloty is volatile and risky. With a competent strategy, you can get high profits.
The European Union includes 28 European countries. Of these, 19 accepted the national currency of the euro, abandoning their own.
The euro does not have its gold reserve; its value is regulated by raising or lowering interest rates. EUR depends on the economic condition of these countries.
There are stable states that continually invest assets in it, forcing the economy to grow and weak ones - they do not invest anything or act to the detriment of the currency.
This happened because historically, countries developed in different ways: the capitalist system, the consequences of wars, internal resources - all this and much more influenced the formation of the economy.
To determine the strength of the currency, you need to take into account the unemployment rate, the percentage of price increases, GDP, external debt, and consumption index. This affects the economy of a particular country. The amount of total influence governs the euro.
The influential states that keep the euro at a high level are Germany, France, Italy. A currency quote directly depends on their economic condition.
The East European countries participating in the agreement occupy outsider positions, delay the budget, the deficit of which is acutely felt in their economy.
This caused the 2016 economic crisis in Europe. In 2019, the EU economy has zero growth, which is a severe failure of the general state and does not bode well for the euro.
The European Central Bank, located in Frankfurt am Main, Germany is involved in resolving the situation. Every first Thursday of the month, except January, a meeting of directors is held where they make decisions on financial matters.
At a subsequent press conference, the ECB President voices them. Quite often, they do not coincide with the forecasts of experts, but desperate times require desperate measures. At the moment, the exchange rate is 4.28 zł for one euro.
Poland retained its currency by refusing to switch to the euro. The Polish zloty is supported by domestic gold reserves, which the country has depleted since 2015. And only in 2019, the Central Polish Bank purchased about 100 tons of gold, which strengthened PLN.
But Polish zloty is still a weak currency. The country has no mineral deposits, oil or gas.
Tourism, light industry, and agriculture are well developed in Poland. Food and consumer goods represent GDP. The inflow of funds depends on the demand for these products and their exports.
Significant jumps in value characterize zloty, sometimes they can exceed a thousand points. This attracts traders who love and know how to take advantage of such differences.
The previously unpopular EUR / PLN currency pair gained interest after Poland bought gold - replenishment was regarded as an attempt to grow economically in an unstable situation in Europe. And the zloty strengthened against the euro.
About 30% of Poland’s GDP is exported to Germany, which is a significant trading partner of this country. The slowdown in the German economy affected the zloty, which immediately began to weaken against the euro.
For an experienced trader, all of these situations are predictable. After takeoff, there is a fall, after which again the positions go up. By monitoring the situation in Germany, observing decisions in the Central Bank of Germany, one can easily predict the next movement of the Polish zloty.
An experienced exchange player must understand how the market conditions are changing and what the market conditions depend on. This will accurately predict the development of events. It is recommended to open orders in the short or medium term.