The widespread presence of social media in all of our lives has grown to such extent that it is ruling how entire industries act and evolve. Brands no longer are responsible for setting trends, but they rather keep their pulse on social media networks to see what the next trend might be and design their products accordingly. Starbucks launched their “decorate your cup campaign” after they saw people posting their art abilities on Instagram. Customer service levels are now dictated by customers threatening to bash their brand on Facebook. But is social media strong enough to predict market moves? Perhaps not (not yet anyway), but it is a great tool for traders.
Here’s how Forex traders can benefit from using social media to take their trading to the next level:
Build community. Many social media networks have the ability to create communities in which like-minded people join to discuss topics of mutual interest. Individual investors can take advantage of these groups or communities in order to gain knowledge, share information and/or bounce ideas off of other members. There is no method better and more accessible than social media in which traders can network with one another, and as such, social media has become a natural habitat for traders looking to be part of a wider community.
Wisdom of the crowds. We get up-to-the-minute information on news, politics and retail sales; why not get similarly current and accurate information about the financial markets on any one twitter feed? While we are not there yet. There isn’t enough activity yet to rely on Twitter to trade, but as financial news services catch up to other industries, we may see information about the markets displayed on social media just as fast as we used to see it in the old Reuters boards.
Get market-influencing event information. Although not widespread yet as we mentioned above, many top analysts and financial news networks do have a presence on social media and use it to disseminate information in a fast and effective way. By following them, traders can get market-influencing events as soon as they happen.
Get new ideas. While social media is a great way to obtain information, developing your own ideas can be risky, but also have the potential to be extremely rewarding and profitable. When you engage in social media, why not discuss concepts with other traders, read technical and fundamental analysis and learn new trading strategies. This way you’ll start to develop your own ideas and concepts about trading forex, commodities and other financial instruments, based on this free flow of financial content. This takes out a lot of the risk and at the same time reassures the potential for success of your personal nuggets of pure genius.Get the 5 most predictable currency pairs