If we skim through the most recent economic news headlines, there are several words and phrases which have tended to dominate most articles. Some of these could be "volatile", "uncertain" and "unknown". A certain type of trader may view these are veritable warning signs for what may lie ahead. However, there are others who appreciate that such fluidity is associated with potentially large profits. This is particularly true when considering the rather ductile nature of the Forex markets. How can we exploit what we have seen so far in 2016? Sensibility is the name of the game in this sense. How can this concept be incorporated into your current wealth management strategy?

Looking at the Major Players

There are several currencies to keep an eye on this year. Many would argue that the dollar, the euro, the pound, the yuan and (potentially) the renminbi fall into this category. The reason that these are so critical is that they are all considered to be benchmark indicators of major regional economies. Employing currency pairs such as the USD/EUR and the EUR/GBP are certain to bring rewards if their movements are predicted correctly.

Where to Watch

We also should recall that the relationship between two currency pairs is influenced by much more than macroeconomic data alone. Politics, consumer sentiment, GDP figures and future manufacturing projections all play important roles. These can actually be considered the "big data" of the Forex sector. It is therefore prudent to keep an eye on the internal economies of both the European Union and the Asian marketplace. Further, the potential for a Brexit could have a massive influence on the value of benchmark currencies. Keeping informed through online news portals is an excellent way to stay ahead of this curve.

Using Automated Trading Tools

Gut instinct and luck have little to do with trading success. Instead, astute investors realise that the tools at their disposal will often determine whether or not they walk away from a trade "in the money". CMC Markets provides a number of instruments which can be used to further bolster any position while reducing risk. Guaranteed stop-loss limits , live trading signals and automatic executions are a few examples. Proprietary architecture, mobile-friendly software and demonstration accounts are other amenities which should never be overlooked. In many ways, a trader is only as efficient as the platform that he or she employs.

Hedging Against Losses

When times turn volatile, it is wise to enact smaller and more frequent currency trades. This mitigates the impact a loss may have while any profits can be pumped back into future positions. This also is an excellent strategy for those who may have only a limited amount of capital to invest.

Sensible trading methods should continue to define a year which may still hold a considerable number of surprises. Adopting these techniques and utilising CMC Markets as a viable trading platform can both help to ensure success during even the most unpredictable of market conditions.