Sophisticated AI tech that can forecast market shifts

31st August 2018
Posted By : Alex Lynn
Sophisticated AI tech that can forecast market shifts

Artificial intelligence technology which successfully anticipated the Pound’s sharp drop at the start of August is being made available for free by the online trading platform INFINOX Capital. INFINOX’s sentiment analysis tool continuously tracks more than five million data sources from around the world to build up a detailed, global picture of market attitudes.

The technology, which uses AI to ingest and analyse thousands of news stories, company announcement and social media posts every minute, gives investors a real time snapshot of market sentiment which doesn't just reflect price movements, but can be used to anticipate them too.

For instance the software identified a worsening of sentiment towards sterling on 28th July, a week before the Bank of England raised UK interest rates. That negative sentiment endured and even led sterling to fall on the day of the Bank’s announcement, despite convention suggesting rate rises cause the Pound to appreciate.

In the following days, comments by the Bank’s Governor Mark Carney and International Trade Secretary Liam Fox about the increasing likelihood of a ‘no-deal’ Brexit sent sterling sentiment reeling further. Despite the publication of official data showing an improvement in UK GDP, the Pound took its cue instead from the negative sentiment and plunged to its lowest level against the Dollar for more than a year.

Jay Mawji, Managing Director of INFINOX, commented: “Sentiment is more than just a mirror on the market – it can be a market-mover in its own right. The Pound’s recent behaviour is a case in point. Investors’ fears of a messy, cliff-edge Brexit combined with negative sentiment to drag down sterling when conventional wisdom suggested it would rise.

“Such insights can give investors a decisive edge, but previously the prohibitive cost of the AI used to power sentiment analysis tools meant they were beyond the reach of all but the wealthiest fund managers and trading desks. But INFINOX is committed to putting world-class trading power into everyone's hands. Advances in AI have allowed us to develop an interactive sentiment analysis tool that any investor can use – for free – to help them make better informed trading decisions."

INFINOX’s sentiment analysis tool is powered by millions of separate data sources curated on its behalf by DowJones, and is one of a suite of powerful but intuitive trading tools available on INFINOX’s IX LABS site.

As well as a live dashboard showing current market sentiment towards a wide range of asset classes, the IX LABS site also offers tutorials, daily market news and charts showing the interplay between sentiment and price. Registration is free, and its goal is to help investors identify clear, actionable intelligence they can use to improve their investment strategy.

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