Join Professional Market Commentator Cameron Buchanan from My Trading Academy for his weekly Market Wrap and Market Forecast for insight into the Global Financial Markets and what is driving them from week to week. Cam offers a fundamental overview for you to learn about the markets and how you too can learn how to trade, manage risk and take advantage of the global economic climate, whether the market is trending up or down.
My Trading Academy is a wholly-owned subsidiary of the International Day Trading Academy Pty Ltd. Cameron is CEO, Co-Founder and Director of the International Day Trading Academy Company and a regular contributor to YTE (Your Trading Edge) Magazine. He is known to his trading students as Cam the Trading Educator and Mentor, Live Trading Room Moderator and Professional Trader.
Watch the Global Market Wrap Video Below
Hi, it’s Cam here from My Trading Academy with last week’s market wrap.
So, last week we saw a ton of volatility in the markets. So, what does volatility mean? Volatility is when you see a lot of price movement in a short amount of time. What causes volatility in the markets? well, it comes from major financial news and it’s all about what the traders percieve. If the news was better than expected price will go up, if the news was worse than expected, the price will go down.
Let’s turn to the charts to see how this volatility affects the markets. I’m going to show you my favourite market, which is the FDAX which is the European stock market. As you can see here, the FDAX dropped 300 points in 5 hours. Now, why did that happen? well, it just came from news. Basically 3 reasons, 2 major German powerhouses Bayer and Lufthansa had really bad results, secondly the consumer confidence in Germany was down for the third month running, and good ol’ Donnie Trump blasted a few tweets out against China. So we had the negative affect in the market.
The bigest news for the week was out of America and we were waiting all week for the Federal Reserve to announce the interest rates. Now, it was expected that they were going to cut the interest rates by a quater percent, and they did, so there was no disapointment there. But, where the disapointment came was the fact that the Chairman during the press conference was not that positive on the economy, and you can see here in the chart the market fell 50 points.
The good news is as Day Traders this is the prime time to take advantage of the volitility and get in and out of the market in a very, very short time. There was a huge drop, and that in about half an hour. This is how volatility can affect the markets dramatically.
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