The U.S. economy is not as robust as most investors would like; but for an investor involved in Forex trading online the U.S. dollar is still one of the most stable currencies. This is evident in the recent three year high the dollar enjoyed. But some events like Federal Reserve Chairman Ben Bernanke´s recent speech (July 10th, 2013) will cause fluctuations of the trade value between the dollar and other currencies. According to Reuters, ¨The euro surged 1.2 percent to a three-week high of $1.3139. Against the yen, the dollar eased 0.8 percent to a two-week low of 98.825 yen.¨
These are the type of events that a Forex introducing broker will pay close attention to; as it allows for investing in a strong and stable currency but allowing to make a profit from the possible overreactions and readjustments afterwards. As Bart Wakabayashi – head of Forex at State Street Global Markets in Tokyo – said about this most recent Bernanke speech, "I was pretty shocked with this selloff this morning. Obviously, Bernanke kicked it all off, but it was a bit delayed reaction.” When involved with Forex trading online it is important to not just pay attention to the news but understand how other traders like a Forex introducing broker would react, both short term and long term.
In the short term, we are seeing the U.S. dollar fall a bit from statements made by Bernanke. ¨Financial markets have recently sold off on concerns that the Fed may begin to scale back its $85 billion a month bond-buying program as soon as September.¨, stated Dominic Lau from Reuters. But for the long term value of the dollar, there should be a rebound (readjustment) since the U.S. economy is still in a good position when compared to the other major economies of the World and the U.S. dollar remains the safe haven for currency. A Forex introducing broker helps new investors understand the short and long term implications of currency value after events like a U.S. Fed speech.