Risk Sentiment
a.k.a. RORO, Risk-on/risk-off, Market mood
The market's overall mood, swinging between greedy risk-taking and fearful safety-seeking.
In plain English
The market's overall mood, swinging between greedy risk-taking and fearful safety-seeking.
Risk sentiment is the market's weather. On sunny days (risk on) investors chase returns; on stormy days (risk off) they huddle in safe havens. Traders call this see-saw RORO: risk-on, risk-off.
Big chunks of forex move on risk sentiment rather than country-specific news. Watching stocks, bond yields and gauges like the VIX gives you a quick reading of the forecast.
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