We can refer the currency pair USD/HUF to peripheral assets. The given pair isn’t popular with investors. However, it doesn’t mean that you can’t earn a profit on it. You need to rationally approach this pair and come up with an effective trading strategy. By the way, the Hungarian Forint demonstrates exceptional volatility.
The evergreen buck happens to be the primary currency of the market. It’s a fundamental component of nearly all Forex financial instruments. Cross-pairs are the only exception here. The Federal Reserve issues USD and takes other measures to stabilize the evergreen buck. Fed meetings often generate extraordinary market volatility. You need to take into account the dates of Fed meetings when working out your strategy.
As we know, the American economy is the largest in the world. Canada, China, and the EU are the major trade partners of the United States. The evergreen buck is a reserve currency. It’s utilized for most international payments.
Hungary is one of few countries that managed to preserve their currencies after joining the European Union. However, it generated many difficulties for the country. Companies trading in the domestic European market are used to keeping their assets outside of Hungary.
The Hungarian economy doesn’t occupy high positions in the regional ranking. In terms of economic strength, the Czech Republic and Poland leave Hungary behind. To make the Hungarian economy competitive enough, many local businesses have cut their employees’ wages that resulted in touch economic issues.
As for the Hungarian GDP surge, it’s quite slow. The Forint demonstrates a strong reaction to any event, even if it doesn’t directly relate to it. Nevertheless, these peculiarities attract investors. The high volatility of this currency pair is its key advantage.
USD/HUF has an unpredictable nature, which makes it attractive to scalpers. Here you shouldn’t rely on medium-term and long-term strategies. A short-term plan – that’s what works best for the Hungarian currencies.
Some news quite predictably impacts the currency pair USD/HUF. Among them, we should mention the unemployment rate, GDP as well as any changes in the discount rate set by the country’s major financial institution. News from America also affects forint quotes. You require closely watching America’s major macroeconomic indicators to be aware of the situation in the Forex market.
To earn on this currency pair, you require properly combining technical as well as fundamental analysis. This approach will enable you to create an effective trading strategy resulting in good gains. Additionally, you should be capable of determining trends on different timeframes. Utilize technical indicators for greater clarity. They will enable you to timely spot changes in market trends. Moving averages are ideal indicators for this purpose.
Besides this, you should also closely watch other currency pairs. For instance, you need to pay attention to GBP/USD, EUR/USD, and CHF/USD. If important news having to do with the greenback is released, all currency pairs with this major asset instantly react to this. Moreover, you should wisely utilize leverage. Avoid risking more than 10% of your trading deposit.