Hello everyone I’ve been seeing some really scary videos on nfp trades. so my question is do nfp events affect British currencies aswell?
If NFPR’s really shock the market by being unexpectedly strong or weak, it tends to affect the risk tolerance throughout many markets. So we can see many apparently uncorrelated markets halt in their underlying trends. This doesn’t mean they reverse, but the volatility can trigger many stops anyway.
GBP is a special situation as we have to expect a Brexit deal announcement at some stage, maybe within days, and it should boost GBP instantly and dramatically. If the details of the deal later seem to be less convincing, price could fall back equally dramatically, so again the pure volatility makes GBP trades both directions unusually risky right now.
The NFP tends to have an effect on all pairs, not just the USD ones. However, tommor is right, the Brexit news are the main (but not only) source of volatility for the GBP.