The given currency is too exotic to be popular in the foreign exchange market. It feels like it lacks any pros. It comes without a low spread or greater profitability compared to other assets. This pair is mostly traded by Polish investors as well as other traders from Eastern Europe.
The pair has typical properties of an exotic asset. It has high volatility, low predictability, and high spread that can be explained by weak liquidity.
It’s quite a rare currency. It has much in common with the South African rand or the Russian ruble. To successfully trade this pair, you require closely watching the pan-European events. The EU economy greatly influences the long-term trend for this pair.
The key distinctive feature of this currency pair is that fundamental factors mostly influence it. So, take it into account when working out your trading strategy. Unfortunately, you can’t find a lot of materials on currency pair in the network. So, get ready to conduct the bulk of research by yourself.
Use specialized forums to derive useful information on the subject. At such online resources, investors share views on the current as well as the future direction of the asset. Most traders on such sites speak English and Polish.
The European trading session is the time when this asset is especially active. In terms of volatility, the Polish currency is like other exotic assets. The Polish currency is traded sluggishly on Monday. You can observe more active trading on Tuesday.
The Polish economy has faced a complicated evolution. Poland successfully conducted market reforms and became part of the EU in 2004. The Polish economy has the following features:
EU members represent the principal trade partners of Poland. Most of the Polish exports are formed by the following sectors: light and chemical industries, engineering, shipbuilding, and agriculture.
Although Poland appears to be a member of the European Union, it hasn’t completely switched to the common currency yet. The matter is that the country hasn’t met the critical requirements for joining the eurozone. The significant issues of the Polish economy include the instability of the national currency zloty and the budget deficit.
Indeed, the US economy surpasses the Polish one in size, and it’s mostly oriented to the services sector (80% of the US GDP). As for the share of the US industrial sector, it amounts to 19,2%, while agriculture accounts for 1.5%. Take it into account when trading this currency pair. Besides this, you should also consider macroeconomic indicators of both countries as well as the European Union.
We also advise you to monitor commodity markets. Don’t forget about unemployment in Poland and America. You should also closely watch changes in the first interest rates by the key financial institutions of these countries.
Don’t forget about technical analysis, although the fundament one is more crucial for this asset. It will help you to find the correct entry and exit points to the market. Assess the asset chart on different timeframes. It will enable you to spot the short-term, medium-term, and long-term trends. Don’t forget about money management. 10% of your trading deposit should be your maximum loss.