While news trading can be challenging, 2019 promises plenty of opportunity for those prepared to take on risk around news events. There are several major ongoing stories that are likely to come to a head in the next 12 months.
First amongst these must surely be Brexit. The UK’s withdrawal from the EU is scheduled to take place at the end of March, but at this stage, no deal has been reached. There are at least four scenarios, all of which could play out;The UK could leave with a “hard” or “soft” Brexit, the withdrawal from the EU could be postponed, or there may be a second referendum. Since the probability of all these outcomes is unknown, none of these scenarios are priced into currency prices. As developments unfold one way or another, strong trends are almost certain to develop, along with volatility and opportunity.
Beyond Europe and the UK, there is the trade war between the US and China, which could soon be resolved or escalate even more, leading to further USD strength and increasing risk across Asia. Also in Asia, talks between North Korea, South Korea, and the US are always something traders watch closely.
US political strife could escalate on several fronts. The Trump-Russia investigation, the national emergency called to fund the wall, and the beginning of election season, could all create new chaos for markets. In addition, a battle is looming between President Trump and the Federal Reserve over interest rate policy.
All of these narratives could make 2019 a great year for news traders.