Here is the situation as April begins. A war is affecting one of the world's most important oil chokepoints. Brent crude is trading above US$100. And the Federal Reserve (Fed), which spent much of 2025 engineering a soft landing, is now facing an inflation threat driven less by wages, services or the domestic economy, and more by energy. It is watching an oil shock.

The Fed funds rate sits at 3.50% to 3.75%. The next Federal Open Market Committee (FOMC) meeting is on 28 and 29 April and the key question for markets is not whether the Fed will cut, it is whether the Fed can cut, or whether the energy shock may have shut that door for much of 2026.

A heavy run of major data releases lands in April. The March consumer price index (CPI), non-farm payrolls (NFP) and the advance estimate of Q1 gross domestic product (GDP) are the three that matter most. But the FOMC statement on 29 April may be the release that sets the tone for the rest of the year.

Growth: Business activity and demand

Think about what the US economy looked like coming into this year: AI-driven capital expenditure (capex) was a major part of the growth narrative, corporate investment intentions looked firm and the One, Big, Beautiful Bill Act was already in the mix. On paper, the growth story looked solid.

Then the Strait of Hormuz situation changed the calculus. Not because the US is a net energy importer, it is not, and that structural insulation matters. But what is good for US energy producers can still squeeze margins elsewhere and weigh on global demand. The 30 April advance Q1 gross domestic product (GDP) estimate is now likely to be read through two lenses: how strong was the economy before the shock, and what it may signal about the quarters ahead.

Labour: Payrolls and employment

February's jobs report was, depending on how you read it, either a blip or a warning sign. Non-farm payrolls (NFP) fell by 92,000, unemployment edged up to 4.4% and the official line was that weather played a role. That may be true but here is what also happened. The labour market suddenly looked a little less convincing as the main argument for keeping rates elevated.

The 3 April employment report for March is now genuinely consequential. A bounce back to positive payroll growth would probably steady nerves and a second consecutive soft print, particularly against a backdrop of higher energy prices, would start to build a very uncomfortable narrative for the Fed. It would be looking at slower jobs growth and an inflation threat at the same time. That is not a comfortable place to be.

Inflation: CPI, PPI and PCE

Here is the uncomfortable truth about where inflation sits right now. Core personal consumption expenditures (PCE), the Fed's preferred gauge, was already running at 3.1% year on year in January, before any oil shock had fed through. The Fed had not fully solved its inflation problem, rather, it had slowed it down. That is a different thing.

And now, on top of a not-quite-solved inflation problem, oil prices have moved sharply higher. Energy prices can feed into the consumer price index (CPI) relatively quickly, through petrol, transport and logistics costs that can eventually show up in the price of nearly everything. The 10 April CPI print for March is probably the most important single data release of the month, it is the one that may tell us whether the energy shock is already showing up in the numbers the Fed watches.

Policy, trade and earnings

April is also the start of US earnings season, and this quarter's results carry an unusual amount of weight. Investors have been pouring capital into AI infrastructure on the basis that returns are coming. The question is when. With geopolitical volatility driving a rotation away from growth-oriented technology and towards energy and defence, JPMorgan Chase's 14 April earnings will be read as much for what management says about the macro environment as for the numbers themselves.

Then there is the FOMC meeting on 28 and 29 April. After the early-April run of data, including NFP, CPI and producer price index (PPI), the Fed will have more than enough information to update its language. Whether it signals that rate cuts could remain on hold through 2026, or whether it leaves the door slightly ajar, may be the most consequential communication of the quarter.

Geopolitical volatility has already pushed investors to reassess growth-heavy positioning. The estimated US$650 billion AI infrastructure buildout is also coming under heavier scrutiny on return on investment. If earnings season disappoints on that front, and if the FOMC signals a prolonged hold, the combination could test risk appetite heading into May.

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Asia-Pacific markets start April with a focus on how prolonged disruption in the Strait of Hormuz feeds through to inflation, trade flows, and policy expectations. China's 15th Five-Year Plan shifts attention toward artificial intelligence and technological self-reliance, with knock-on effects for supply chains and regional growth. Japan and Australia both face the challenge of managing imported energy inflation while gauging how far they can normalise policy without derailing domestic demand.

For traders, the mix of elevated energy prices and policy divergence may keep volatility elevated across regional indices and currencies.

China

Lawmakers in Beijing have approved the 15th Five-Year Plan (2026-2030), placing artificial intelligence (AI) and technological self-reliance at the centre of the national agenda. The government has set a growth target of 4.5% to 5.0% for 2026, the lowest in decades, as it prioritises quality of growth over speed.

Japan

The Bank of Japan (BOJ) faces increasing pressure to normalise policy as energy-driven inflation risks a resurgence. While consumer prices excluding fresh food slowed to 1.6% in February, the recent oil price spike may push the consumer price index (CPI) back toward the 2% target in coming months.

Australia

The Australian economy remains in a state of two-speed divergence, with older households increasing spending while younger cohorts face significant affordability pressures. Following the Reserve Bank of Australia's (RBA) rate increase to 4.10% in March, markets are highly focused on upcoming inflation data to assess whether additional tightening may be required.

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If you've spent any time looking at a trading terminal, you've seen it. A news headline breaks, a chart line snaps, and suddenly everyone is rushing for the same exit or the same entrance. It looks like chaos. In practice, it is often a chain of mechanical responses.

This matters for a couple of reasons. Many readers assume the story is the trade. It is not. The story, whether it is an interest rate decision, a supply shock or an earnings miss, is the fuel and the playbook is the engine.

Below are seven core strategies often used in contracts for difference (CFDs) trading. With CFDs, you are not buying the underlying asset. You are speculating on the change in value. That means a trader can take a long position if the price rises, or a short position if it falls.

Seven strategies to understand first

1. Trend following (the establishment play)

Trend following works on the idea that a market already in motion can remain in motion until it meets a clear structural obstacle. Some market participants view it as a chart-based approach because it focuses on the prevailing direction rather than trying to call an exact turning point.

The rationale: The aim is to identify a clear directional bias, such as higher highs and higher lows, and follow that momentum rather than position against it.

What traders look for: Exponential moving averages (EMAs), such as the 50-day or 200-day EMA, are commonly used to interpret trend strength, though indicators can produce false signals and are not reliable on their own.

How it works: The 50-period EMA can act as a dynamic support level that rises as price rises. In an uptrend, some traders watch for the market to make a new higher high (HH), then pull back towards the EMA before moving higher again. Each higher low (HL) may suggest buyers are still in control.

When price touches or comes close to the 50-period EMA during that pullback, some traders treat that area as a potential decision zone rather than assuming the trend will resume automatically.

What to watch: The sequence of HHs and HLs is part of the structural evidence of a trend. If that sequence breaks, for example if price falls below the previous HL, the trend may be weakening and the setup may no longer hold.

2. Range trading (the ping-pong play)

Markets can spend long stretches moving sideways. That creates a range, where buyers and sellers are in temporary balance. Range trading is built around this behaviour, focusing on moves near the bottom and top of an established range.

The rationale: Price moves between a floor, known as support, and a ceiling, known as resistance. Moves near those boundaries can help define the width of the range.

What traders look for: Some traders use oscillators such as the Relative Strength Index (RSI) to help judge whether the asset looks overbought or oversold near each boundary.

How it works: The support level is a price zone where buying interest has historically been strong enough to stop the market from falling further. The resistance level is where selling pressure has historically prevented further gains.

When price approaches support, some traders look for signs of a potential rebound. When it approaches resistance, they look for signs that momentum may be fading. RSI readings below 35 can suggest the market is oversold near support, while readings above 65 can suggest it is overbought near resistance.

What to watch: The main risk in range trading is a breakout, when price pushes decisively through either level with strong momentum. This may signal the start of a new trend and using a stop-loss just outside the range on each trade may help manage that risk.

3. Breakouts (the coiled spring play)

Eventually, every range comes under pressure. A breakout happens when the balance shifts and price pushes through support or resistance. Markets alternate between periods of low volatility, where price moves sideways in a tight range, and high-volatility bursts where price can make a larger directional move.

The rationale: Quiet consolidation can sometimes be followed by a broader expansion in volatility. The tighter the compression, the more energy may be stored for the next move.

What traders look for: Bollinger Bands are often used to interpret changes in volatility. When the bands tighten, a squeeze is forming. Some market participants view a move outside the bands as a sign that conditions may be changing.

How it works: Bollinger Bands consist of a middle line, the 20-period moving average, and 2 outer bands that expand or contract based on recent price volatility. When the bands narrow and come close together, the squeeze, the market has been unusually calm.

This is often described as a coiled spring. Energy may be building, and a sharper move can follow. Some traders treat the first move through an outer band as an early clue on direction, rather than a definitive signal on its own.

What to watch: Not every squeeze leads to a powerful breakout. A false breakout occurs when price briefly moves outside a band, then quickly reverses back inside. Waiting for the candle to close outside the band, rather than entering mid-candle, can reduce the risk of being caught in a false move.

4. News trading (the deviation play)

This is event-driven trading. The focus is on the gap between what the market expected and what the data or headline actually delivered. Economic data releases, such as inflation figures (CPI), employment reports and central bank decisions, can cause sharp, fast moves in financial markets.

The rationale: High-impact releases, such as inflation data or central bank decisions, can force a fast repricing of assets. The bigger the surprise relative to expectations, the larger the move may be.

What traders look for: Traders often use an economic calendar to track timing. Some focus on how the market behaves after the initial reaction, rather than treating the first move as definitive.

How it works: Before the news, price may move in a calm, tight range as traders wait. When the data is released, if the actual reading differs significantly from the consensus expectation, repricing can happen fast.

Gold, for example, may spike sharply on a CPI reading that comes in above expectations. However, the candle can also print a very long upper wick, meaning price reached the spike high but was then rejected strongly. Sellers may step in quickly, and price may retrace. This spike-and-retrace pattern is one of the more recognisable setups in news trading.

What to watch: The direction and size of the initial spike do not always tell the full story. Wick length can offer an important clue. A long wick may suggest the initial move was rejected, while shorter wicks after a data release may indicate a more sustained directional move.

5. Mean reversion (the rubber-band play)

Prices can sometimes move too far, too fast. Mean reversion is built on the idea that an overextended move may drift back towards its historical average, like a rubber band pulled too tight, then snapping back.

The rationale: This is a contrarian approach. It looks for stretches of optimism or pessimism that may not be sustainable, and positions for a return to equilibrium.

What traders look for: A common example is price moving well away from a 20-day moving average (MA) while RSI also reaches an extreme reading. In that setup, traders watch for a move back towards the mean rather than a continuation away from it.

How it works: The 20-period MA represents the market's recent average price. When price moves into an extreme zone, such as more than 3 standard deviations above or below that average, it has moved a long way from its recent trend.

An RSI above 70 can suggest the market is stretched to the upside, while below 30 can suggest the same to the downside. Some mean reversion traders use these combined signals as a sign that a pullback towards the 20-period MA may be possible, rather than assuming the move will continue to extend.

What to watch: Mean reversion strategies can carry significant risk in strongly trending markets. A market can remain extended for longer than expected, and a position entered against the short-term trend can generate large drawdowns. Position sizing and clear stop-losses are critical.

6. Psychological levels (the big figure play)

Markets are driven by people, and people tend to focus on round numbers. US$100, US$2,000 or parity at 1.000 on a currency pair can act as magnets. In financial markets, certain price levels can attract a disproportionate amount of buying and selling activity, not because of technical analysis alone, but because of human psychology.

The rationale: Large orders, stop-losses and take-profit levels can cluster around these big figures, which may reinforce support or resistance. This self-reinforcing behaviour is one reason these rejections can become meaningful for traders.

What traders look for: Traders often watch how price behaves as it approaches a round number. The market may hesitate, reject the level or break through it with momentum. Multiple wick rejections at the same level may carry more weight than a single one.

How it works: When price approaches a round number from below, some traders watch for long upper wicks, the thin vertical line above the candle body. A long upper wick means price reached that level, but sellers stepped in aggressively and pushed it back down before the candle closed.

One wick rejection may be notable. Three in a cluster may be more significant. Some traders use this accumulated rejection as part of the case for a short (sell) setup at that level.

What to watch: Psychological levels can also act as magnets in the opposite direction. If price breaks through with conviction, the level may then act as support. A decisive close above the level, rather than just a wick break, can be an early sign that the rejection setup is no longer holding.

7. Sector rotation (the economic season play)

This is a macro strategy. As the economic backdrop changes, capital may move from higher-growth sectors into more defensive ones, and back again. Not all parts of the sharemarket move in the same direction at the same time.

The rationale: In a slowing economy, discretionary spending may weaken while demand for essential services can remain more stable. Investors may rotate capital between sectors accordingly.

What traders look for: With CFDs, some traders express this view through relative strength, taking exposure to a stronger sector while reducing or offsetting exposure to a weaker one.

How it works: During a growth phase, when the economy is expanding, investors tend to prefer growth-oriented sectors like technology. As the economic environment shifts, perhaps due to rising interest rates, slowing earnings or increasing recession risk, a rotation point may emerge.

In the slowdown phase, the pattern can reverse. Technology may weaken while utilities may strengthen, as investors move capital into defensive, income-generating sectors. Early signals can include relative underperformance in growth sectors combined with unusual strength in defensives.

What to watch: Sector rotation is not usually an overnight event. It typically unfolds over weeks to months. Tracking the ratio between two sectors, often shown in a relative strength chart, can make this shift visible before it becomes obvious in absolute price terms.

Why risk management is the engine of survival

The headline move is one thing. The market implication for your account is another. If you do not manage the mechanics, the strategy does not matter.

Because CFDs are traded on margin, a small market move may have an outsized impact on the account. If leverage is too high, even a minor wobble may trigger a margin call or automatic position closure, depending on the provider's terms. This is not a theoretical risk. It is a common reason new traders lose more than they expected on a trade that was directionally correct.

The market does not always move in a straight line. Sometimes, price gaps from one level to another, especially after a weekend or major news event and in those conditions, a stop-loss may not be filled at the exact requested price. That is known as slippage. It is one reason large positions may carry additional risk into major announcements.

Bottom line

The vehicle is powerful, but the playbook is what helps keep you on the road.

The obvious trade is often already priced in. What matters more is understanding which market condition is in front of you. Is it trending, ranging, breaking out or simply reacting to a headline?

Readers assessing leveraged products often focus on position sizing, risk limits and product disclosure before deciding whether the product is appropriate for them. The headlines will keep changing. The maths of risk management does not.

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^{Disclaimer: This article is general information only and is intended for educational purposes. It explains common trading concepts and market behaviours and does not constitute financial product advice, a recommendation, or a trading signal. Any examples are illustrative only and do not take into account your objectives, financial situation or needs. CFDs are complex, leveraged products that carry a high level of risk. Before acting, consider the PDS and TMD and whether trading CFDs is appropriate for you. Seek independent advice if needed. Past performance is not a reliable indicator of future results.}