By Giles Coghlan, Chief Currency Analyst at HYCM
It's wild out there
Ok, it's a crazy day out there and one we will all remember this day going forward. We were there. So, here are some things not to do today as well as other things to do, so you are still trading tomorrow. Fortunes are lost AND made on days like these.
Things not to do - Don't be a hero
Don't over leverage. With markets crashing, circuit breakers in the equity markets, and monthly moves in minutes you will get badly burned if you trade with high leverage. You will either make a fortune or lose your entire trading account. Usually the latter. Trade with wide stops, low/little leverage or not at all. Remember that old adage; there are old traders and bold traders. However, there are no old, bold traders. If you were around in 2015 and saw the SNB remove the 1.2000 peg you have no excuse to get caught out today. Unexpected events can and do occur, in markets. Today is such a day across multiple markets.
Things to do - Be a bargain hunter
With US Oil down -28% be a bargain hunter. Look for that ridiculously cheap price. In 1998 we had oil prices down to under $10 a barrel. Why not put in a few pending orders, so if this is the mother of all crashes. which it looks like it is shaping up to be, you can grab a bargain along the way. Just use no leverage so even if the market floors you are still sitting pretty.
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Don't be a hero, be a bargain hunter!
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