Tsunami Hits Hawaii – Forex Opportunity?

It's now 12:30 pm in Hawaii and a Tsunami is expected to hit any any moment.The tsunami heading for Hawaii is the result of a massive 8.8 earthquake in Chile earlier this morning. This story has received nationwide news coverage, and you can learn more about the details of the chile earthquake hawaii tsunami at cnn.com.

Fortunately, I live in the mountains with a nice safe view of the impending tsunami. As the tsunami heads for me in Hawaii, it causes me to think about the implications of the forex market.

Currently the forex market is closed since it's saturday. The forex is so huge that the tsunami will likely not directly affect the exchange rate of the USD (us dollar). If the tsunami does massive damage (in the Billions) then there could be an impact when the foreign exchange market opens tomorrow.

Riding The Wild Wave

Just like the ocean, price movement in the forex market moves in waves.  The market moves in normal waves. Occasionally there is a major event (a forex equivalent of an earthquake) that causes a MASSIVE change in the forex market. After the impact of this MAJOR event happens, the prices will settle down and stabilize.

In the FOREX, any MAJOR news can cause a forex tsunami. Of course this news isn't always predictable, but when it happens you need to be able to go with it (or else it'll wipe you out).

Surfers attempting to surf the hawaii tsunami wave

As the tsunami approaches towards Honolulu, Hawaii you can see several surfers out in the water trying to "catch the big wave."  While it is a safe bet in the forex market to avoid the tsunami, it can be a great thrill to try and ride the wave. Capturing an insane forex price movement would be just as exciting as riding that big tsunami wave heading towards me now…

Fortunately for us forex traders, we can anticipate forex tsunami's on a regular basis. While we can't predict MAJOR news events like earthquakes or political chaos, we can follow fundamental announcements that are known to repeatedly cause major forex price movements.

When the US non-farm payroll payroll information is released (usually the first friday of each month), the EUR/USD will often react wildly and unpredictably. There are other economic events that cause major forex price actions to occur (you can look at the major ones at this forex economic calendar.

I'll be sharing more about the Hawaii tsunami and fundamental forex announcements on this blog. If you register for the free 20 part eCourse at the upper right of this website, you'll learn more about how to trade forex economic announcements.

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