The global economy regularly goes through periods of major stress — from recessions and financial crashes to geopolitical conflicts and pandemics. These macroeconomic crises do not just affect individual sectors; they reshape the entire market environment and change how price discovery works. Understanding their nature and dynamics is crucial for every participant in the financial markets.

Beyond their direct economic impact, crises also have a powerful effect on trader psychology and market sentiment. For both novice and experienced traders, it is extremely important to recognise how external shocks can trigger emotional reactions that distort rational decision-making and intensify volatility in the markets.

How Economic Shocks Change the Market Landscape

During periods of macroeconomic crises, markets often behave in ways that deviate from “normal” conditions. Sharp swings in price and spikes in volatility become the norm. Investors tend to move into a risk-off mode, reallocating capital into more conservative or safe-haven assets, which can lead to a sharp decline in the prices of higher-risk instruments. Correlations between assets that usually move together may suddenly break down, making classic diversification strategies less effective. At the same time, fundamental analysis becomes more difficult, as forecasts grow unstable and analysts’ opinions seem less reliable.

Such changes require a trader not only to adapt but also to rethink basic assumptions about market efficiency and how quickly information is priced in. A trader must be prepared to operate in a regime of heightened uncertainty, where historical patterns and models may temporarily stop working as expected.

Psychological Traps in Turbulent Markets

Ultimately, macroeconomic crises become not only an economic challenge but also a serious psychological stress test for the trader. Fear of loss, one of the strongest emotional drivers, intensifies dramatically, pushing traders toward panic selling or, conversely, complete inaction due to fear of entering at the “wrong” level. The phenomenon of herd mentality — when traders follow the crowd instead of their own analysis — becomes especially visible. This is often accompanied by fear of missing out (FOMO) when markets move quickly.

Novice traders, lacking experience in navigating such periods, are particularly vulnerable to these influences. However, even seasoned market participants may encounter the same problems under pressure. Cognitive biases inherent to human thinking — such as confirmation bias or loss aversion — manifest most clearly during crises, making it especially difficult to maintain discipline, objectivity, and a rules-based trading approach.

Developing Resilient Strategies for Crisis Periods

To successfully navigate the storm of macroeconomic turbulence, a trader must have a clear and reliable trading plan. First and foremost, this includes strict risk management: precise control of position sizing, setting clear stop-loss levels, and avoiding excessive use of leverage that can quickly lead to large drawdowns.

Portfolio diversification across different asset classes and various geographic and political regions becomes especially relevant in such conditions, as it helps mitigate concentration risk. In addition, it is important to maintain a “cash cushion”. This not only helps a trader withstand periods of turbulence and adverse price action but also provides flexibility to take advantage of new opportunities to buy undervalued assets when market sentiment stabilises.

The Importance of Continuous Learning and Analytical Thinking

In a constantly changing market environment, continuous learning stops being merely desirable and becomes a prerequisite for survival and success. A solid understanding of key macroeconomic indicators — such as interest rates, inflation, GDP, and unemployment levels — together with awareness of central bank policies and major geopolitical events, enables traders not only to react to news but also to anticipate its possible impact on market pricing and volatility.

A critical approach to information, filtering out sensational headlines, and focusing on reliable data sources help to develop independent analytical thinking. Studying the history of past crises provides valuable lessons and reveals recurring patterns of market behaviour, helping traders build more effective strategies for current and future challenges. The ability to self-analyse, review trade logs, and adjust one’s trading methods based on accumulated experience also plays a vital role in long-term performance.

Your Path to Psychological Resilience

Macroeconomic crises are an integral part of the global financial system. Although they cannot be prevented, their negative impact on your trading activity can be minimised — and in many cases, transformed into an opportunity.

The key lies in developing psychological resilience, supported by strict discipline, sound risk management, and continuous self-education. Emotional control, the ability to remain calm amid panic, and critical thinking help traders avoid the most common behavioural pitfalls that destroy trading accounts.

The post Surviving Market Storms: Psychology, Risk Management and Strategy first appeared on Online broker AMarkets.

Currency interventions are one of the most powerful tools central banks use to influence the exchange rate of their national currency. They may step in to protect the economy from sharp fluctuations or to provide support during periods of stress.

For traders and investors, these actions can open the door to profitable opportunities — but only if they understand how interventions work and can respond quickly.

The Essence of Interventions

A central bank intervenes in the foreign exchange market by buying or selling foreign currency in exchange for its own.

• If the regulator wants to strengthen the national currency, it sells part of its foreign reserves and buys back its own currency.
• If the goal is to weaken the national currency, the process is reversed.

Interventions may be carried out openly — with official statements and published figures on transaction volumes — or covertly, through affiliated commercial banks.

The reasons vary. A strong national currency makes exports less competitive abroad. A weak currency, on the other hand, raises the cost of imports and drives inflation. Striking a balance between these forces often shapes a central bank’s strategy.

How the Market Reacts

Markets almost always respond to interventions with an immediate shock. Within minutes or hours, exchange rates can swing sharply. However, the effect is not always lasting. If the economic fundamentals contradict the regulator’s goals, the currency often drifts back toward its previous level.

Psychology also plays a major role. Even the expectation of intervention — hinted at in official statements or media reports — can trigger volatility. Traders begin to act in anticipation, which often amplifies the move.

Profit Opportunities

There are several strategies traders use to take advantage of interventions:

1. Trading on the Announcement

When an intervention is announced, traders may enter at the start of the impulse. This requires lightning-fast execution and extremely short timeframes.

2. Mean Reversion Plays

If the intervention goes against a strong existing trend, the exchange rate often reverts. In this case, the strategy is to trade in the opposite direction — but only after confirming a reversal.

3. Reading Central Bank Rhetoric

Central banks rarely act without sending signals first. Press conferences, interviews, and meeting minutes often contain hints. Experienced traders use these cues to position themselves before the intervention.

4. Using Cross-Currency Pairs

Sometimes the direct move in a currency pair is difficult to capture, but the effects spill over into related crosses. This creates additional opportunities for traders who take a broader view of the market.

Risks and Limitations

The main risk is the unpredictability of both the magnitude and duration of the impact. In some cases, an intervention can set the trend for weeks; in others, the effect fades within hours.

False signals are another hazard. Rumors about interventions may cause sharp market moves even without actual action from the central bank.

In certain cases, interventions are accompanied by restrictions on market participants. Authorities may limit currency operations or raise margin requirements, reducing traders’ ability to enter or exit positions quickly.

Information Sources

To trade interventions effectively, timely and reliable information is essential. The most valuable sources include:

• Official central bank press releases and statements
• Updates from Bloomberg, Reuters, and Dow Jones
• High-speed newswires
• Economic calendars highlighting central bank meetings

The faster a trader learns about an intervention or even the intention to intervene, the better the chances of securing a profitable position.

The Long-Term View

Not all interventions are short-term events. Sometimes they mark the beginning of a broader shift in monetary policy. For example, sustained foreign currency purchases may indicate preparation for monetary easing — a change that can eventually affect all asset classes. In such cases, strategies shift from quick speculation to building long-term positions in equities, bonds, or commodities that benefit from future currency moves.

Conclusion

Currency interventions are more than just attempts to stabilize exchange rates — they are signals of deeper economic forces at work. They can provide opportunities, but success demands speed, discipline, and the ability to work with information as much as charts.

The real advantage lies not in chasing every short-term spike, but in recognizing the broader direction of central bank policy. Seen in this light, an intervention is not market noise — it’s a signal that the economic pendulum may be swinging in a new direction.

The post How Central Bank Interventions Move Currencies first appeared on Online broker AMarkets.

Trading on the Forex market has long since moved beyond being a game of luck. In today’s financial environment, success depends not on gut feelings but on a clear understanding of the forces that shape the global economy.

One of the most important of these forces is monetary policy. Why has it become an essential part of every successful trader’s toolkit? And how does it influence Forex trading strategies?

The Foundation of the Currency Market

A country’s monetary policy is a set of decisions made by its central bank to control inflation, manage interest rates, and stabilize the national currency. Decisions by major regulators — such as the U.S. Federal Reserve, the European Central Bank, or the Bank of England — can shift the value of key currencies within minutes.

For an experienced trader, ignoring these decisions is not an option. Central bank actions directly affect market liquidity and currency pair volatility. These changes influence both short-term and long-term trading strategies, forming a foundation for making informed, data-driven decisions.

How Do Interest Rate Changes Shape Forex Trends?

Interest rates are one of the primary tools of monetary policy. Raising rates typically strengthens the national currency because the returns on financial assets denominated in that currency increase. This attracts investors, boosting demand and pushing the exchange rate higher.

For example, if the U.S. Federal Reserve raises interest rates, the U.S. dollar often appreciates against other currencies. This can be a signal to take long positions on the dollar and short positions on currencies whose interest rates remain unchanged or are being cut.

The opposite is also true: when interest rates are lowered, the currency becomes less attractive to investors, often leading to depreciation. By understanding these mechanisms, traders can anticipate price movements and position themselves accordingly.

Why Is Inflation Important?

The reason is straightforward: inflation is a key factor influencing central bank decisions. When inflation rises, central banks are more likely to raise interest rates. Conversely, low inflation often results in rate cuts or the introduction of economic stimulus measures.

For traders, understanding inflation dynamics opens up strategic opportunities. For example, if inflation in the Eurozone accelerates, the European Central Bank may raise rates, which could strengthen the euro. By tracking inflation expectations, traders can enter the market ahead of competitors and profit from early positioning.

Market Psychology: Why Is the Reaction Often More Important Than the Event?

Experienced traders know that the Forex market is driven not only by numbers and indicators but also by market psychology. Sometimes, the market’s reaction to a central bank decision is more significant than the decision itself. For instance, if investors expect a rate hike but the bank keeps rates unchanged, the currency may weaken sharply — even though there was no formal negative announcement.

This is why successful traders pay close attention not just to the official outcomes of central bank meetings, but also to analysts’ forecasts and investor sentiment leading up to them. In this way, monetary policy becomes more than just a set of economic measures — it’s also a window into how the market interprets and responds to information.

The Power of a Systematic Approach

Many novice traders make the mistake of relying solely on technical analysis. Seasoned professionals understand that without a solid grasp of fundamental factors — especially monetary policy — it’s impossible to get a complete picture of the market.

A systematic approach that blends technical analysis with a deep understanding of monetary policy helps traders develop more precise and resilient strategies. For example, combining trend analysis with anticipated central bank rate changes can reduce risks while boosting potential returns. This balance is the foundation of long-term success in Forex.

Knowledge as a Competitive Advantage

Studying monetary policy is not just a useful extra — it’s a real competitive advantage. Many market participants overlook it, but those who understand these processes in depth can act faster and more decisively, improving their trading performance.

Ultimately, the reason successful traders study monetary policy is simple: they want to grasp the deeper forces driving the market — and then use that insight to make smarter, more profitable trading decisions.

The post Why Smart Traders Always Watch Central Banks first appeared on Online broker AMarkets.

News trading is one of the most popular and simultaneously risky strategies in the financial markets. The release of key economic data can instantly shift a market’s direction, even making seasoned traders uneasy.

However, with proper preparation and a clear approach, this volatility can become an opportunity rather than a threat. The key question is: how can traders anticipate sudden market movements and respond with confidence?

Why Markets React Sharply to Economic News

Financial markets react to news much like the human nervous system responds to a sudden stimulus — quickly and sharply. Unexpected information forces participants to immediately reassess their outlooks and adjust their positions. For example, sudden changes in interest rates, surprising employment data, or major political statements can all trigger rapid price swings.

The challenge is that even when traders correctly anticipate the news itself, the market’s reaction may be unpredictable. At times, positive data leads to a sell-off, while negative headlines spark a rally. Why does this happen? Because markets often “price in” expectations well in advance. As a result, the actual reaction may diverge from what logic or even prior experience might suggest.

Why Preparation Is Key

The first rule of successful news trading is thorough preparation. Traders must be aware not only of which events are scheduled, but also how those events could impact the markets. An economic calendar is an essential tool, allowing traders to track the timing of key announcements such as central bank rate decisions, unemployment data, and GDP releases.

Equally important is analyzing how the market has responded to similar events in the past. This includes reviewing both the initial price reactions and the corrections that often follow after the news is digested.

Before a major release, it’s also wise to reassess any open positions. Traders should consider reducing exposure — either by scaling down trade size or placing protective orders. These steps can help shield against sharp, unexpected moves that might otherwise result in significant losses.

What to Do When the Market Doesn’t Follow the Script

Even the most carefully planned strategy can fall short when trading the news. Markets often move in unexpected ways — sometimes defying logic or prior patterns. So, how should traders respond?

• Stick to strict risk management. Preserving capital must remain the top priority. Stop-loss levels should be clearly defined in advance and followed without exception.
• React quickly when needed. If the market turns against your position, it’s often better to exit early and reassess. Hesitating can turn a manageable loss into a much larger one.
• Always have a backup plan. Experienced traders prepare a “Plan B” before the event. For instance, if your initial setup anticipates rising prices, you should already know the conditions under which you’d reverse your trade and take an opposing position.

Let the Dust Settle Before You Trade

Entering a trade at the exact moment news is released isn’t always the most effective strategy. In many cases, it’s wiser to wait for the initial wave of volatility to pass, assess the new market environment, and only then enter once a clearer direction has formed.

This more measured approach reduces the risk of getting caught in the emotional reactions and sharp price swings that often follow major announcements. By allowing the market to settle, traders can make more informed decisions, join established trends with greater confidence, and avoid impulsive moves driven by short-term noise.

Which News Events Matter the Most?

Markets tend to react most sharply to a few key types of events:

• Central bank interest rate decisions
• Employment and unemployment data (especially from the U.S.)
• Inflation reports
• Major political statements (particularly those related to trade wars, sanctions, or geopolitical tensions)

That said, even news that seems less important on the surface can trigger significant market moves, especially if the outcome surprises analysts or deviates sharply from expectations.

The Art of Staying Calm

Traders who navigate news-driven volatility successfully tend to share one essential trait: they stay calm under pressure. Emotional decision-making is one of the biggest threats in fast-moving markets. The urge to quickly recover losses or chase a missed opportunity often leads to poor outcomes.

In moments like these, it’s critical to pause — even briefly — and assess the situation with a clear head. A calm, measured response is far more effective than reacting on impulse.

Thriving Amid Uncertainty

Markets will always deliver surprises — that unpredictability is part of what makes them so dynamic and fascinating. News trading isn’t just about managing risk; it’s about recognizing opportunity and adapting to whatever conditions unfold. The most successful traders aren’t those who predict every move correctly. They’re the ones who embrace uncertainty, remain flexible, and respond decisively when the landscape changes.

In the end, it’s your ability to adjust your strategy and stay composed under pressure that defines long-term success, especially when others see only chaos and loss.

The post News Trading: How to Handle Unexpected Market Moves first appeared on Online broker AMarkets.

In 2025, the oil market is navigating a complex landscape. Geopolitical instability, slowing global economic growth, and the accelerating energy transition are fueling significant uncertainty around hydrocarbon prices.

So, what can we realistically expect from the oil market in the second half of the year and which factors will shape the price trends ahead?

Geopolitics Back in the Driver’s Seat

By mid-2025, Brent crude had settled around $69 per barrel, once again highlighting oil’s sensitivity to geopolitical developments. Escalating tensions over Iran’s nuclear program, particularly in June, introduced a notable “risk premium” into the market. According to J.P. Morgan analysts, this premium currently adds about $4 per barrel. While these risks persist, much of the geopolitical uncertainty has already been priced in, making sharp upward moves in prices unlikely, unless there’s a dramatic escalation.

However, even a minor shift — such as the potential lifting of sanctions against Iran — could drastically change the outlook. Citi analysts warn that a return of Iranian oil to global markets might push Brent briefly down to the $50–55 range. While this is not the base-case scenario, it underscores the fragility of the current market balance.

Oversupply Looms: Economic Slowdown and Energy Transition

Beyond geopolitics, market fundamentals are also signaling downward pressure on prices. The World Bank forecasts Brent crude to average $64 per barrel in 2025, falling further to $60 in 2026. This outlook reflects weakening global trade and a slowdown in economic growth, both of which weigh heavily on oil demand. This trend is particularly evident in China, where the rapid adoption of electric vehicles is cutting deeply into traditional fuel consumption.

Goldman Sachs presents an even more bearish scenario, projecting that recession-driven demand could pull prices to around $59 per barrel this year, and down to $55 in 2026. At such levels, U.S. oil producers would likely be forced to scale back output, eventually tightening supply and preventing prices from falling much below $60 in the longer term.

OPEC+’s Balancing Act

OPEC+, the world’s most influential oil alliance, continues its careful balancing act between protecting prices and managing oversupply risks. In April 2025, the group revised its forecast for global oil demand growth from 1.45 million to 1.3 million barrels per day. Yet by July, it reaffirmed that the market remains in “healthy condition,” citing persistently low inventories.

Starting in August, OPEC+ nations will raise output by 548,000 barrels per day. However, they’ve made it clear that this decision could be reversed if market conditions weaken due to oversupply. This flexible approach suggests OPEC+ is aiming to keep Brent prices within a $65–70 range — levels seen as acceptable to both producers and consumers.

Still, analysts at Bank of America warn that weak demand may become OPEC+’s biggest challenge moving forward. If the global slowdown deepens, output cuts alone may not be enough to stabilize prices, increasing the risk of downward pressure.

Analyst Consensus: Moderately Pessimistic

Analysts and investment banks remain cautiously pessimistic. Most, including HSBC and Morgan Stanley, forecast Brent to average around $68–70 per barrel in the second half of 2025. J.P. Morgan and Citi are more conservative, projecting a range of $60–65.

This cautious outlook reflects two key concerns: softening demand due to economic stagnation, and the potential for increased supply, including from Iran. While OPEC+ can mitigate some of this oversupply, its ability to fully offset it is limited, particularly if economic stagnation persists.

Market Prospects: Pressure on Prices but No Collapse

For the remainder of 2025, oil prices are likely to remain moderate, fluctuating within a range of $60–70 per barrel. While geopolitical tensions will continue to inject volatility, the core driver will be the supply-demand balance, which currently leans toward surplus.

Paradoxically, a short-term dip below $60 could help bring medium-term stability. Lower profitability would likely reduce investment in production — particularly in the United States — helping to ease the oversupply and prevent a deeper decline.

As a result, although the market appears fragile at the moment, it still has a strong likelihood of stabilizing by early 2026. Assuming no major geopolitical disruptions, the oil market is positioned to avoid both a sharp collapse and extreme price spikes. In today’s uncertain global environment, such a stable outcome may be the most beneficial scenario for an economy that increasingly values predictability and balance.

The post Oil Market Outlook H2 2025: Price Pressures and Geopolitical Risks first appeared on Online broker AMarkets.

On July 3, 2025, the U.S. House of Representatives approved President Donald Trump’s sweeping budget and tax bill. The $3.4 trillion package, informally dubbed the “One Big Beautiful Bill”, is making waves far beyond Capitol Hill. Its implications are now being debated by politicians, economists, and investors around the world, many of whom are voicing concern not just about the fiscal health of the United States, but about the future of the U.S. dollar.

So what lies ahead for the dollar, and is talk of the end of its global dominance really justified?

How Will the U.S. Economy Change After the Reform?

Trump’s new legislation marks the most significant overhaul of the U.S. tax system since his own 2017 reform. It includes massive tax cuts totaling over $4.5 trillion, a major increase in defense spending, and deep reductions to social programs. Medicaid, food assistance, and environmental initiatives introduced during Joe Biden’s presidency are set to be dramatically scaled back.

On one hand, these measures could serve as a powerful stimulus for economic growth and offer relief to the middle class. On the other hand, critics warn that they could sharply increase income inequality and place a heavier burden on the federal budget.

Debt and Deficit: Warning Signs

The bill immediately raised the debt ceiling by $5 trillion, eliminating the short-term risk of a government default. However, long-term concerns have intensified among financial analysts and credit rating agencies. According to the Congressional Budget Office (CBO), the law will expand the federal budget deficit by $3.4 trillion over the next decade — on top of an already staggering national debt that now exceeds $36 trillion.

Such a surge in borrowing inevitably leads to higher interest payments, potentially shaking investor confidence. Financial markets are already witnessing the return of so-called “bond vigilantes” — investors who demand higher yields in response to what they see as fiscal irresponsibility. This could lead to higher borrowing costs for the government and slower economic growth.

Moody’s Downgrade and Growing Fiscal Risks

Earlier this year, in spring 2025, Moody’s downgraded the U.S. credit rating from its top-tier AAA status to AA1. The primary reason: a continued failure by lawmakers to rein in growing deficits. Moody’s analysts have warned that without decisive action, the U.S. budget deficit could reach a critical 9% of GDP by 2035.

This scenario raises the real possibility of another downgrade and a further erosion of global confidence in U.S. government bonds. The higher the debt burden grows, the greater the risk that the dollar will lose its role as the world’s primary safe-haven currency.

Currency Market Reactions: The Dollar Under Pressure

The dollar has already been showing signs of strain amid increasing financial instability. Since the beginning of the year, it has lost about 9% of its value against a basket of major world currencies. By the end of June 2025, the U.S. Dollar Index recorded its worst first-half performance since the 1970s.

Experts largely attribute the dollar’s decline to mounting investor anxiety over uncontrolled fiscal spending. In response, many countries are beginning to diversify their foreign reserves, further weakening the dollar’s dominance as the global reserve currency. If this trend continues, the international financial system may need to adapt to a new reality — one that could introduce fresh risks to global economic stability.

Possible Scenarios

So what comes next? Analysts are weighing several potential scenarios — each with distinct risks and benefits.

The first scenario involves a moderate devaluation of the dollar. This could help ease the U.S. debt burden and stimulate exports in the short term. However, it would also risk higher inflation and potentially damage the credibility of U.S. monetary policy.

The second scenario is a gradual de-dollarization of the global economy. More countries could begin conducting trade and holding reserves in alternative currencies, further reducing their reliance on the U.S. dollar. Given Washington’s growing fiscal challenges, this scenario is becoming increasingly plausible.

The third and most extreme scenario would involve the U.S. government imposing strict administrative controls, such as capital restrictions or forced repurchase of its own bonds. This would effectively end the dollar’s role as a freely traded reserve currency. While dramatic, most experts consider this outcome highly unlikely.

The Dollar Is Still Alive — But Its Monopoly Is Weakening

Despite growing concerns, the dollar remains indispensable to the global economy. The United States still hosts the world’s largest and most liquid financial markets, and alternatives like the euro or Chinese yuan have yet to gain broad investor confidence.

That said, Trump’s latest legislation does mark a turning point. It weakens the dollar’s monopoly and creates the conditions for significant shifts in the international monetary landscape. If the U.S. fails to stabilize its debt and restore market confidence, it risks losing some of the geopolitical and economic influence that comes with being the world’s reserve currency issuer.

Conclusion

Donald Trump’s tax reform is nothing short of a bold economic experiment. In the short term, it offers the U.S. economy a substantial stimulus and avoids the immediate risk of default. But the long-term outlook is far more uncertain.

What was meant to boost America’s economic strength may ultimately undermine its fiscal stability and erode the dollar’s reputation as the safest currency in the world. For the United States, this should serve as a wake-up call: How far can a nation rely on debt to drive growth before the consequences become irreversible?

The post Trump’s ‘Big Beautiful’ Bill: A Turning Point for the U.S. Dollar? first appeared on Online broker AMarkets.

Trade conflicts are nothing new in the global economy, but few have impacted global markets as dramatically as the renewed US–China trade war in 2025. Triggered by aggressive actions from the Trump administration and met with swift retaliation from Beijing, this confrontation showed just how sensitive today’s markets are to shifts in geopolitics.

For traders, it’s important to understand what happened, which events mattered most, and why trade wars act like a “litmus test” for market sentiment. Let’s walk through the key stages of the conflict and how different markets reacted.

The First Strike

2025 began with Donald Trump’s return to the White House, and almost immediately, he signaled a tougher approach to trade policy. On April 2, new tariffs were introduced, triggering a major market reaction: U.S. stock indices lost trillions in market value within days. At the same time, the Chinese yuan weakened sharply, and Bitcoin and other major cryptocurrencies dropped by about one-third.

But this wasn’t just about tariffs. Markets saw these moves as a warning sign of a broader economic slowdown ahead.

China’s Counterattack

Later in April, China responded with its own 34% tariffs on U.S. imports. But this round of escalation went beyond just tariffs. China also introduced non-tariff measures, including restrictions on exports of rare earth metals, critical for electronics and defense.

Markets reacted strongly — not just because of direct economic losses, but because of growing uncertainty. Stock prices in both countries kept falling, and currency market volatility jumped.

Interestingly, the crypto market didn’t follow its usual pattern. After the initial sell-off, Bitcoin entered a holding pattern. Many investors had already priced in the risk and chose to wait, largely ignoring day-to-day news.

The Peak of Confrontation

By the end of April, both countries had added even more tariffs, with rates rising above 100% — effectively making trade between them unprofitable. On top of that, China suspended shipments of key raw materials, further disrupting global supply chains.

This hit some U.S. industries hard and raised fears of a possible recession. However, an unexpected twist came from the Chinese yuan, which stabilized thanks to direct intervention from the People’s Bank of China. Meanwhile, cryptocurrencies began a slow, cautious recovery, as investor confidence gradually returned.

Truce in Geneva

In May, a temporary truce surprised markets. After negotiations in Geneva, both sides agreed to lower tariffs to around 30%, providing much-needed relief.

Markets responded quickly. U.S. and Chinese stock indices rebounded, and emerging market currencies strengthened. But despite the optimism, traders stayed cautious, aware that the underlying issues still hadn’t been resolved.

A New Threat

Later in May, the trade war shifted into a “tech war” phase. Both countries imposed new restrictions on exports of high-tech goods and critical components.

For the first time, it became clear that this conflict wasn’t just about tariffs anymore. It had the potential to disrupt global supply chains and directly impact individual companies and entire sectors. Despite the seriousness of the situation, the markets remained relatively stable — waiting to see how the next round of negotiations would unfold.

The London Deal

The conflict reached a turning point during talks in London, where both countries signed a preliminary agreement. The deal lifted the most severe export restrictions and locked tariff rates at more manageable levels.

This outcome had been expected, but one thing surprised traders: the reaction from Bitcoin. While stock markets climbed steadily, Bitcoin surged sharply, reaching new highs much faster than equities.

This signaled a shift in how cryptocurrencies are viewed. No longer seen only as risky assets, they started to act more like indicators of market sentiment — sometimes even ahead of traditional markets.

Final Thoughts

The events of 2025 clearly showed that markets react not just to economic data, but to investor expectations. This was especially true in the case of cryptocurrencies, which by the end of the conflict were behaving more like leading indicators than reactive ones.

For traders, the key takeaway is this: it’s not enough to just follow the news or look at hard numbers. You also need to understand how markets are interpreting those events — and what they expect to happen next. In today’s world, successful trading during events like trade wars comes down to your ability to spot signals early, often before they become obvious to everyone else.

The post US–China Trade War: How Did the Markets React? first appeared on Online broker AMarkets.

For decades, investors have pursued the “holy grail” of diversification: a portfolio formula designed to minimize risk while maximizing returns. However, recent market crises have brutally exposed the shortcomings of traditional approaches. The classic 60/40 stock-bond portfolio, once the bedrock of stability, has increasingly proven ineffective, as both asset classes now frequently decline in tandem.

This critical shift necessitates a new paradigm. In response, innovative portfolio strategies are emerging, expanding beyond conventional assets like currencies and equities to embrace the rapidly expanding world of cryptocurrencies.

Cryptocurrencies in the Portfolio: Experiment or Necessity?

The rapid institutional adoption of cryptocurrencies paints a clear picture. In just two years, the proportion of hedge funds investing in crypto assets nearly doubled, climbing from 29% in 2022 to a significant 47% in 2024. This dramatic increase begs the question: Why are major financial institutions embracing such volatile assets?

The compelling answer lies in their low correlation with traditional markets. This unique characteristic means that even a small allocation to cryptocurrencies can profoundly reshape a portfolio’s risk-return profile, offering vital upside potential precisely when conventional assets are underperforming.

The Correlation Puzzle: Crafting the Right Combinations

The very foundation of diversification rests on combining assets that do not move in lockstep. While this principle is often understood within asset classes—where, for instance, companies within the same equity sector or most cryptocurrencies tend to follow Bitcoin’s trajectory — the true power emerges from combining fundamentally different asset types.

Indeed, correlations between distinct asset classes, such as stocks, currencies, and cryptocurrencies, are generally much lower. For example, the historical correlation between Bitcoin and the S&P 500 has consistently remained minimal, offering a clear diversification benefit.

However, a crucial caveat applies: caution is paramount. During periods of market stress or systemic crisis, these typically low correlations can spike suddenly and unpredictably. This phenomenon underscores the vital necessity of dynamically adjusting diversification strategies and continually reassessing asset combinations in response to evolving market conditions.

Lessons from the Giants: Who Is Already Adopting the New Model?

Paul Tudor Jones: Cryptocurrency as Inflation Insurance

Legendary macro investor Paul Tudor Jones was among the first major figures to publicly embrace Bitcoin, allocating 1%–2% of his portfolio to it as early as 2020. His rationale was clear: he viewed cryptocurrency as a potent hedge against inflation. This foresight proved highly profitable; within a year, Bitcoin’s value surged by 150%, significantly enhancing his fund’s performance.

Soros Fund Management: Cryptocurrencies Over Traditional Currency Bets

Soros Fund Management, a name synonymous with high-stakes currency speculation, made a notable pivot towards cryptocurrencies in 2021. The firm began to view Bitcoin not just as an asset but as a modern commodity and a robust hedge against both inflation and the potential devaluation of fiat currencies. This strategic shift by Soros powerfully demonstrated that digital assets can effectively complement and even enhance traditional currency and equity strategies.

Brevan Howard: Digital Diversification in Practice

Brevan Howard took a structured approach, launching a dedicated crypto division, BH Digital, to incorporate digital assets into its broader portfolio. By 2024, this unit delivered returns exceeding 51.8%, demonstrating how crypto can be a powerful diversification tool when managed carefully.

Ruffer Investment: Strategic Diversification and Timely Profit

Even traditionally conservative firms are embracing crypto’s potential. The British firm Ruffer Investment Management made a highly strategic move, allocating 2.5% of its assets to Bitcoin in 2021 as a short-term hedge against inflation. This tactical play proved exceptionally lucrative: within just five months, Ruffer generated a remarkable $1.1 billion profit, successfully exiting at the market peak. This case powerfully illustrates how even a well-timed, short-term exposure to cryptocurrencies can significantly enhance a portfolio’s annual returns.

Capital Allocation: Proven Approaches

Institutional investors today are adopting a measured approach to cryptocurrency exposure, typically allocating a modest share of their capital. They adhere to principles like risk parity and strict asset-weight limits. A prime example is BlackRock’s 2025 model portfolio, which incorporates a small, strategic allocation to Bitcoin, carefully balanced by a slightly reduced weighting in traditional equities and bonds. This approach allows investors to minimize risks while maintaining high potential returns.

Just as important is regular portfolio rebalancing. This allows investors to lock in gains from overheated assets and reallocate to undervalued ones, maintaining portfolio discipline over time.

Risk Management: Attention to Detail Is Crucial

Managing multi-asset portfolios, especially those integrating cryptocurrencies, demands a disciplined and highly detailed approach to risk control. Essential tools include the strategic use of stop-loss orders, predefined drawdown thresholds, and the continuous monitoring of asset correlations. The experiences of firms like Brevan Howard and Ruffer powerfully illustrate how these meticulous practices are vital in preventing significant losses, even amidst the sudden and sharp volatility inherent in the crypto market.

Furthermore, incorporating traditional safe-haven assets, such as the Swiss franc or Japanese yen, can further bolster portfolio resilience, providing an additional layer of hedging against instability in both conventional equities and the more nascent digital asset space.

Conclusion: Active Diversification — The New Investment Imperative

Modern markets are all about rapid change and constant volatility. Here, old investment strategies just don’t offer the same protection or performance. To adapt, investors must rethink diversification — it’s no longer passive but an active, evolving process.

Despite their ups and downs, cryptocurrencies can boost portfolio performance when used wisely. The real secret isn’t just spreading money around but smart use of assets based on their unique behaviors and correlations.

Integrating currencies, equities, and crypto isn’t just a trend; it’s a practical necessity for investors aiming to succeed in a world of endless uncertainty.

The post The New Diversification Playbook: Currencies, Stocks, and Crypto first appeared on Online broker AMarkets.

The period from 2021 to 2025 witnessed substantial volatility in the prices of two essential industrial metals – copper and aluminum. Following the economic disruption caused by the COVID-19 pandemic, prices initially surged and later stabilized.

In this article, we will closely examine these significant price trends and analyze how economic and technological factors shaped the markets for these metals.

Key Price Trends in 2021–2025

2021: A Sharp Rise in Demand

In 2021, the global economy rebounded swiftly after pandemic-related restrictions began easing. As a result, demand for industrial metals, particularly copper and aluminum, significantly outpaced supply. Copper prices hit an all-time high of $10,700 per ton in May, with the annual average around $9,317 per ton. Similarly, aluminum prices rose sharply from roughly $2,000 at the year’s outset to approximately $3,200 per ton by year-end, driven mainly by high demand from the automotive and construction sectors.

2022: Price Peaks and High Volatility

Early 2022 was marked by significant price fluctuations. In March, aluminum prices neared a record high of approximately $4,000 per ton, and copper exceeded $11,000 per ton. However, by mid-year, this upward momentum reversed dramatically. Copper prices dropped by more than 25%, reaching around $7,500 per ton by August. Aluminum prices also fell sharply, bottoming out just above $2,000 per ton in September. The primary causes for these declines were a deteriorating global economic outlook, rising inflation, and interest rate hikes by major central banks.

2023–2024: Stabilization and Moderate Recovery

The year 2023 saw relative price stability, with copper trading around $8,500 per ton and aluminum averaging about $2,250 per ton. Improved supply conditions combined with moderate demand levels contributed to this stability. A modest recovery followed in 2024: aluminum prices rose slightly to an average of $2,420 per ton, while copper prices stabilized near early-decade levels. These trends were linked to anticipated economic stimulus measures in China and ongoing supply constraints.

Economic Factors Affecting Price Dynamics

The global economic cycle significantly influenced copper and aluminum prices in the early 2020s. For instance, the rapid industrial rebound following the pandemic directly caused price increases in 2021. China’s strong role as a major producer and consumer, especially in its automotive and construction industries, was also a key factor. Furthermore, supply chain disruptions exacerbated metal shortages, leading to price spikes.

However, the dynamics changed between 2022 and 2023. Rising inflation and subsequent interest rate hikes by central banks globally slowed down industrial production and investment. In addition, a stronger U.S. dollar put downward pressure on metal prices by making them more expensive for buyers using other currencies. Nevertheless, easing restrictions and targeted stimulus in China partially offset the declining demand, contributing to eventual price stabilization.

Impact of Technological and Structural Factors

Technological advancements also play an increasingly important role in sustaining copper and aluminum prices over the long term. The global shift toward sustainable energy solutions and the rapid growth of electric vehicles substantially increased copper demand, as it is essential for electric motors and battery production. This ongoing demand provided steady support for copper prices, even during economic slowdowns.

Similarly, aluminum benefited from technological developments, especially the rising demand for lightweight materials in the automotive and aviation industries. The growth of wind and solar energy infrastructure further boosted aluminum alloy consumption. Despite notable advances in recycling technologies and improved energy efficiency in aluminum production, their immediate impact on prices was limited, primarily due to slow progress in deploying new production facilities.

Strategies for Traders and Investors

Analyzing copper and aluminum price dynamics from 2021 to 2025 offers valuable insights and practical strategies for traders:

• Tracking the Global Economic Cycle. Metal prices closely reflect the economic cycle phases. Traders should monitor economic policy decisions in key economies (especially China and the U.S.), global industrial conditions, and shifts in central bank interest rates.
• Capitalizing on Technological Trends. Long-term investors should focus on structural technological shifts. The transition to renewable energy and the growth of electric vehicle markets ensure sustained copper and aluminum demand, enhancing their long-term investment appeal. Nevertheless, emerging industry trends, such as the increased use of plastics instead of aluminum in aviation, require careful observation.
• Monitoring Supply Chain Conditions. Supply chain disruptions significantly impact metal prices, providing opportunities for traders who respond promptly to these short-term fluctuations.
• Hedging Against Currency Risks. Since metal prices are denominated in U.S. dollars, traders must account for currency fluctuations when developing their investment strategies.

Conclusion

To sum up, the price changes of copper and aluminum between 2021 and 2025 show that the economy’s regular cycles and new technologies in the metal industry are major drivers. For traders to be successful, they need to carefully and promptly assess how these factors link together, paying attention to both short-term economic shifts and long-term industry changes. By understanding this big picture, traders can develop the best ways to navigate the copper and aluminum markets.

The post Global Copper and Aluminum Prices: Key Trends (2021–2025) first appeared on Online broker AMarkets.

Commodity markets attract investors because of their high volatility and potential for rapid profits. However, successfully trading commodities like gold, oil, coffee, or cocoa isn’t always straightforward. While fundamental and technical analyses are crucial, traders must also consider seasonal factors.

In this article, we’ll explore how seasonal trends influence the prices of popular commodities, highlighting why even the clearest seasonal patterns should not be the sole basis for trading decisions.

What is Seasonality, and Why is it Important?

Seasonality refers to predictable fluctuations in asset prices that regularly recur at certain times each year. For example, coffee prices often rise during winter, while oil prices typically increase in the summer months. These seasonal price movements occur due to anticipated changes in supply and demand, influenced by weather conditions, agricultural cycles, and holiday seasons.

However, experienced traders know that even consistent seasonal trends do not guarantee accurate price predictions. This uncertainty arises because many other factors can rapidly affect market dynamics. To better understand this, let’s explore specific examples from real-world commodity markets.

Gold and Silver — Traditional Seasonal Trends

Historically, gold prices have shown a consistent upward trend in January. Since 1971, the average price increase during the first month of the year has been approximately 1.8%. Traditionally, this seasonal rise was linked to increased holiday-related demand for jewelry and investment coins. However, in recent years, these connections have become less distinct. Silver follows a similar pattern, often experiencing steady growth in the first quarter, averaging around a 3% increase in January and February.

Yet, even during these traditionally favorable periods, gold and silver prices can deviate significantly from historical averages due to macroeconomic factors. For instance, the election of President Donald Trump caused substantial volatility in gold prices during the first quarter of 2025, illustrating how significant macroeconomic events can overshadow typical seasonal influences.

Oil — Seasonal Demand and Its Limitations

The seasonal dynamics in the oil market are even more pronounced. Typically, oil prices rise during the summer months when demand for gasoline and aviation fuel peaks. As a result, WTI oil prices often reach their yearly highs during this period, providing traders with more predictable price movements.

Nevertheless, the oil market is particularly vulnerable to geopolitical disruptions. Events such as conflicts in the Middle East, sanctions against major oil-producing nations, or unexpected decisions by OPEC+ can dramatically disrupt traditional seasonal patterns.

This situation is currently evident, as despite the approaching summer months, recent decisions by OPEC+ members and escalating trade tensions between the US and China have significantly pressured oil prices. In April alone, Brent crude prices dropped by 18%, underscoring how geopolitical factors frequently override seasonal trends.

Macroeconomic Factors: Why Do They Matter More Than Seasonality?

Similar dynamics affect other commodities as well, such as coffee, cocoa, and various metals. While traders can indeed identify recurring seasonal patterns, even the most consistent cycles have limited predictive value in financial markets. Macroeconomic and geopolitical events usually exert a much stronger influence. For example:

• Political shocks, such as elections, wars, or sanctions, can swiftly overturn established trends.
• Central bank decisions, including interest rate adjustments by institutions like the US Federal Reserve, often cause sharp fluctuations in prices for gold and other commodities.
• Weather-related disasters in major agricultural regions frequently disrupt expected seasonal patterns.

In short, macroeconomic events carry significantly more weight and unpredictability than seasonal factors – a crucial consideration that traders must always keep in mind.

Trading Strategy: Combining Seasonal and Macroeconomic Approaches

Experienced traders don’t see seasonality and macroeconomic analysis as conflicting methods; instead, they skillfully combine both. What does this integrated approach look like in practice?

• Identify the general seasonal trend for the commodity you’re trading (for example, anticipate gold prices rising in January).
• Conduct a thorough analysis of the current market environment, taking into account political developments, central bank interest rate decisions, and overall economic conditions.
• Make your trading decision only after carefully evaluating all these factors.

This combined strategy helps reduce risks and improves the likelihood of profitable trades. By considering both seasonal patterns and real-time economic developments, traders can make more accurate predictions and navigate the market effectively.

Conclusion: Seasonality as Part of the Bigger Picture

Seasonality can undoubtedly assist traders in understanding market patterns, especially during periods without major disruptions. However, traders must not underestimate the powerful impact of macroeconomic, geopolitical, and climatic factors, which often drive broader trends and cause sudden price movements.

A skilled trader never relies solely on seasonal patterns; instead, they analyze the market comprehensively. By adopting this balanced approach, traders enhance their chances of long-term success when trading commodities in CFD markets.

The post How Seasonality Affects Commodity Markets first appeared on Online broker AMarkets.