WARNING: Potentially hazardous market conditions – Japanese golden week
Japan has an extended spring vacation, ‘Golden Week’, from 27th April to 6th May. This will be the longest market closure since the end of World War II, creating potentially hazardous market conditions due to the low liquidity expected across all markets during Asian hours.
Low liquidity, especially during Asian hours, can create extreme market movements aka ‘flash crashes’. Recent examples of these include:
- 3rd January 2019 – JPY crosses +10%
- 7th October 2016 – GBP crosses -10%
What does this mean?
There will definitely be lower liquidity during Asian market hours. This will mean really slow markets and wider spreads during Asian hours with the potential for extremely fast-moving markets and extreme price moves.
What should you do?
IC Markets urges all its clients to take precautionary measures before the holidays. This includes assessing and reducing risk exposures, setting stop levels, especially on JPY crosses. Furthermore, additional funding may protect clients from large adverse movements in the market.
In order to protect clients from poor liquidity & sharp adverse movement, IC Markets reserves the rights to change the leverage on all symbols, without giving further notice, should the need arise.
We will carefully monitor market conditions, and should there be any further changes, we will contact you via email, the trading platform, or post changes on our website.