Picking currency pairs in the forex market is fun and challenging at the same time. Each pair has its own intricacies and factors that make it interesting to learn about and trade. Conversely, the European continent does not have a shortage of exceptional currencies you can use in a myriad of pairs that will keep you on your toes in the forex market.
One currency that might have yet to gain your attention but makes for an excellent trading pair with the British pound and other currencies is the Polish Zloty (PLN). The Polish GDP makes it one of the largest economies in the world, and the Zloty a stable currency to trade. The country is also a significant exporter and importer of goods and services, which means the forex market is lively enough and presents multiple opportunities for any trading strategy. This trading guide will teach you a few tips on trading the PLN, so keep reading.
1. News Trading
When trading the PLN, or any other currency, it’s always an excellent idea to keep your eye out on current news and events that might affect its volatility. Arming yourself with financial information, such as Poland’s fiscal policies and updates from the central bank, will allow you to anticipate short-term changes affecting your currency pair. Ensuring you’re in the best position to take advantage of any situation.
Furthermore, Poland is facing a substantial threat from Russia and the war in Ukraine, which has affected the PLN price for most of this year. Changes in that situation will significantly affect the Zloty and the rest of Europe, and keeping up to date with the news will be invaluable to your trading.
2. Day Trading
Day trading involves taking advantage of intraday shifts in the exchange rate by placing multiple trades that usually close in a day. This helps avoid losses from overnight volatility when you’re not around to monitor the markets. The PLN is an active currency that will provide multiple day trading opportunities for optimal outcomes in your trading sessions.
Day trading also allows you to pair the PLN with different currencies and use multiple strategies simultaneously, increasing your chances of finding success in the market.
3. Momentum Trading
Momentum trading involves using technical indicators to enter and hold short- or medium-term trade positions. Conversely, the energy crisis in Europe has created the perfect conditions for the PLN to have erotic swings, which makes momentum trading an excellent strategy to benefit from the markets.
Furthermore, unlike day trading or scalping, you don’t have to dedicate a lot of time to monitor your positions. Once you have them locked in, you only need to check in on them occasionally and make adjustments as need be. Making momentum trading an excellent way to benefit from trading the PLN, even if you’re busy with your job or other life engagements.
4. Scalping
Scalping is a forex trading strategy that involves holding multiple positions for a short period for small profits. The goal is to make incremental profitable trades, to make a sizable amount at the end of the day. Depending on your currency pairs, the PLN can provide multiple scalping opportunities in a trading session, which is very beneficial.
However, scalping the PLN can be highly volatile and cause slippage on your stops which could lead to massive losses. This can erode days’ worth of effort; therefore, you should be cautious and always keep a close eye on your trades.
5. Pick a PLN-friendly Platform
The trading platform you choose can make or break your forex trading. A platform such as eToro will allow you to trade the Zloty and give you access to other essential analytical tools. Its deposit and withdrawal methods for UK residents are easy, fast and secure.
Conclusion
Unlike other markets, the forex industry is always lively and presents multiple opportunities to profit. It can also be easy to fall into a dull routine involving only a few currency pairs, making your trading life seem mundane and repetitive. However, introducing a new currency like the PLN to your repertoire can be profitable and, most importantly, help you spice things up.
In addition, learning about the PLN will help you keep on top of global financial matters, which will be invaluable to your forex trading.