Trading Around Uncertainty
Some financial media experts say that all trading and investing is uncertain by nature. Therefore, why should uncertainty in the markets matter? Well, while there’s some truth to this sentiment, it’s too simplistic. Specific types of uncertainty can directly affect market conditions. While they’re not always easy to anticipate, traders can remain vigilant to help mitigate them.
External shocks are unexpected changes or announcements that impact the economy and financial markets and originate from outside of them. Recent examples include President Trump’s trade war tweets. He announced tariffs via Twitter (TWTR) on Chinese and Mexican goods on May 5 and May 30, respectively, blindsiding market participants. On June 7, Trump announced...
