I am new to forex trading so I wanted some advice on how one would take advantage of trading on the back of major political events – like the results of the upcoming referendum on whether Britain remains in or out of the EU.
It would seem like whichever way the referendum results go, it would offer a good opportunity to bet on the GBP either strengthening or weakening (perhaps GBB/USD)
But is there much more to it then just this?
How quickly do the markets normally respond to major events like this?
For example, if Britain chooses to remain in the EU and the pound rallies, is it likely that the sharpest part of that rally might last mere minutes after the official results are announced? Or hours? Or longer?
I have seen how release of market indices reports have had almost instantaneous affect on the strength of a currency, with sharp spikes taking effect within 30 seconds of such developments, after which, there tends to be a short dip.
And could it be the case that which ever way the referendum results go, it does not necessarily mean we can predict which way GBP will go?
Is it foreseeable that with Britain remaining within the EU (which I believe is likeliest), the sterling doesn’t rally?
Any feedback would be much appreciated.
I am trying my hand at forex and thought the referendum would be a good opportunity to make a larger then normal trade, given the size of the event and the broadly predictable impact it would have.