CURRENCY TRADING

How To Build A Strong Trading Strategy????

2009-11-17T08:38:00.000-08:00

More than just one technical tool: a decent strategy should contain at least 2 different indicators, one of them is a leading indicator and the other one is a lagging one while 3 indicators will give you a more slower signal but it'll be a more stronger one.
A fundamental rating measurement factor to measure the news effects: this would be a self-established one which can be discovered by testing the news effects on the FOREX market and measure it to establish a factor that suits the trader.
The trading time frame: keep in mind that a scalper wouldn't wait to take confirmation from 2-3 indicators on a H1 chart, he is waiting usually for a tick up or down to enter his position, some other ticks and he is out.
Your account equity: what ever your trading strategy or trade length, never put all the eggs in one basket, keep an open eye on your equity, not your balance.
Risk factor: setup your daily risk ratio and never exceed it if you lost on a day, you'll never get back the money you lost by going emotional and try to achieve revenge. If you have to lose and you already lost the supposed risk ratio, stop trading at that day, have some rest then try to study that position and the mistake that did lead to that losing trade.
Daily targeted profit: when you get your target achieved, take rest and save your efforts for studying the next day opportunities. If you are about continue trading, set a stop loss of no more than half the achieved profit and don't go so greedy.

Weekly currency outlook

2009-11-17T08:36:00.000-08:00

We are still seeing the Dollar struggle to fully round this next bend but we continue to see more upside opportunity in dollars than downside risk. Therefore we continue to favor buying dips as it has paid out over 5000 pips for us since June 1^st of this year. We expect to see many dips to buy this week so be ready for some entries, many of them will be either fading new highs or buying new lows so be warned it will not be comfortable…at first…but in time it will look like genius.

EUR/USD:

This pair continues to present medium term entry opportunities as it trades north of 1.50. We are looking for spikes early this week to sell into. Look for the herd to chase this thing for a bit so we could see spikes into at least 1.51-1.52.

GBP/USD:

We are happy sellers this week near the 1.68 handle and expect to have a few opportunities above that to sell into. We could see some squeeze potential up to 1.70 but all of those wicks are just that much more of a sell. We continue to see the BOE as being too loose and really the lapdog of the FOMC so until that changes we want to sell strength here as it is temporary at best!

USD/CHF:

Parity remains a solid support level at this time and near term we do expect it to hold.
We are looking to buy dips back towards parity over the next few weeks.

USD/JPY:

This pair continues to see wild volatility as the shift from using Yen for carry trades to Dollars continues. This pair and other crosses with the Yen will continue to see extreme periods of bi polar activity as global risk shifts away from Yen and towards Dollars.

AUD/USD:

This pair is in a bubble of its own partly due to the commodity bubble we have seen reflated this year. This will be the “canary in the coal mine”. As this pair turns back before hitting parity you will see it lead the way down just as it has lead the way up in this global ponsi scheme the central banks seem to be running.

USD/CAD:

This pair has also turned just before hitting parity. We expect to see it push back up towards 1.10 before the year is out.

Top 10 Biggest Mistakes Forex Traders Make

2009-11-17T08:34:00.000-08:00

Alexander Elder

2009-11-17T08:33:00.001-08:00

Alexander Elder is an enigma in the world of stock traders; he not only understands the details of the transactions, but also the mindset of the traders before, during and after the business deal. More importantly, he has successfully transferred this knowledge to common market behavior, making him the trader with an edge that those attending Dr. Elder’s seminars eagerly seek to imitate.

BOE GOVERNOR'S WORDS TANK THE POUND

2009-11-15T07:44:00.000-08:00

The British Pound Sterling fell across the board on Wednesday, after the Bank of England’s Governor, Mervyn King, said a slide of the Pound could help UK exporters and aid Britain's recovery from recession.

The remarks came after the UK released data on inflation which came in below the target, a better than expected showing.

Investors are nervous however, even with the good inflation news, that after the elections early next year, the new government will implement a policy of fiscal tightening, which will likely cut the asset-buying program, a program that is widely hailed as a success.

At 10:15PM GMT, the British Pound was trading down 1.2% versus the US Dollar to .9288, down 1.02% to the Euro to .9042, down 1.15% to the Japanese Yen to 148.6, down 1.1% against the Swiss Franc to 1.6691 and down 1.06% versus the Australian Dollar to 1.7802.

Using Fibonacci Retracements with Support & Resistance Levels in Forex

2009-11-15T06:52:00.001-08:00

One of the essential principles of applying technical analysis to forex trading in a profitable manner is that you want to see multiple confirmations for an entry point before you actually enter the market.

If you are making trading decisions based upon prominent candlestick formations on a long term chart, it would also be wise to check with a number of other indicators when you get a buy signal in order to make sure that there are no contradictions. In this article we are going to focus on how Fibonacci retracement levels coincide with support and resistance levels, and how you can use these two different technical indicators in conjunction with each other in order to yield accurate market entry signals.

Let’s start by defining what both of these types of indicators are. Fibonacci retracements are based on the number 1.618 (also called the Golden Ratio) that is found in all natural orderly systems from flowers to the human body to the financial markets. Over the years it has been proven that when the price of a currency pair has a large move and then retraces back in the direction of the previous value, it is statistically more likely to rebound at the levels of 38.2%, 50%, and 61.8% of the original price move.

The way that many traders use Fibonacci retracement levels is to determine when to enter and when to exit the forex market. A Fib retracement can give a buy signal when the price hits one of the three Fib values and then rebounds, or it can show that the market is ‘running out of steam’ and it is time to exit when the price approaches one of the three Fib values and then falls. While Fib levels can be excellent indicators, it is never wise to enter into a trade based on these values alone.

Support and resistance levels are pretty much exactly what they sound like: Support levels are the price values below the current price data that the market will tend to rebound off of, and resistance levels are exactly the same except they are above the current price data. Support and resistance levels can offer strong forex entry signals when the price breaks through an established level, as when this happens the price has a tendency to continue moving in that direction.

S&R levels and Fib retracements are both powerful trading tools individually, but when you combine them together the trading signals become much stronger and more reliable. As mentioned above, a Fib retracement can give a strong market entry system when the price retraces a given movement and then switches direction around one of the three main Fib values.

As a general rule of thumb when trading the forex market, the longer the time frame of a chart, the more reliable the trading signals that are generated. So if you happened to be looking at a 4-hour or 8-hour chart and you saw a strong Fib retracement signal, the way that you could confirm this signal using support and resistance levels is to see whether the Fib value is also a predominant S&R level.

If the price bounces off the S&R level, this is not as strong an indication for market entry as when the price passes through an established level, because once the price crosses an established support or resistance level then it has a tendency to continue moving in that direction.

Forex Conquest Review

2009-11-15T06:51:00.001-08:00

The beta-testers of the new Forex automated trading software called The Forex Conquest have reported being able to generate as much as $1,300+ every day using it. It is able to start trading with a starting capital of as small as $200, compounding returns as it starts making profitable trades. The Forex Conquest utilizes internal tools to help it calculate optimal entry and exit points automatically.

After going through major improvements over the past few years, The Forex Conquest is finally able to achieve its maximum accuracy in determining trend movements accurately.

The Forex Conquest Software Is Officially Released On Tuesday 3rd Nov, 2009 at 11a.m EST

Now you can download some free gifts from Forex Conquest team.

1) Channel Profit Alerter software

This amazing gift is created by Nick Channon and The Forex Conquest team. Download it, unzip the file and read the instruction. It should take you 5 minutes to get it running.
Plus, you will also be able to find out more about how Nick turned his $3000 investment to $150k in a short time…merely with forex trading.

Please read the manual guide if you are not familiar with MetaTrader. “Channel Profit Alerter” is a small gift from The Forex Conquest team and we are glad that you like it.

Top Automatic Forex Robot-Forex Invasion Reviews

2009-11-15T06:50:00.001-08:00

This FAP turbo review 2009 will look into the FAP turbo expert advisor. This newsletter will identify if the declared expert advisor robot is earning money or not. This EA is a Metatrader four foreign exchange trader machine. You set it onto 15-minute charts and just leave it to do its stuff. See more about best forex trading robots compared below. The testing started on January five, 2009 with a start up capital of £500. The writer was using the EURGBP currency pair. It did not happen to just the writer but also to a number or people, in particular traders of the same currency pair.

The loss was quite large since 2 weeks’ worth of profit all went into smoke. This robot still can make money. You may be considering why FAP turbo review 2009 still gave this expert counsel a positive review after a very bad loss. The reason behind Jan 19th’s draw down was the incontrovertible fact that the banking world of the United Kingdom crashed at that point. See more about best forex trading robots compared below. See more about best forex trading robots compared below. Why did this happen? Are not these EA’s built with risk avoidance systems? The answers to these questions are quite plain. The EA itself has some failings, just like any application. It is not perfect. You will still need to glance at the markets and check for any signs of volatility. These categories of scenario only happen often. The bottom line is that this EA will still make you a lot of money. After the draw down, the writer was able to recuperate his losses and begin with an identical quantity just before the draw down. If you’re looking for a actually good forex robot, then this robot is the one for you. For FAP turbo review 2009, this automated expert advisor is reasonably good.

FAP Turbo is meant to immediately investigate trading info. It gives a real-time trading results from one or two accounts and the trader can get updates every fifteen mins.See more about best forex trading robots compared below. By using this software a trader is not required to have a big quantity of startup capital to proceed. See more about best forex trading robots compared below. It also employs a particularly distinctive algorithm method that allows it to prevent losses and optimize its returns. See more about best forex trading robots compared below.First, this is so easy to download and it would not take the majority of your time installing it. It also has a video tutorial that will give you step by step instructions on how to properly install and operate FAP Turbo.

There are pro consultants to watch the trading and will start orders if you want it. If and ever a user encounters some troubleshooting Problems with the software, FAP Turbo claims to a have a ready client support system that may handle clients’ queries, aside from the manual included in the package to help users install the system. See more about best forex trading robots compared below. Free updates for this programme are also offered. From here, you can get and download mandatory updates or program revision for your software. See more about best forex trading robots compared below. Like any ventures, money trading comes with lots of risks to take and avoid so it’s way better to first try the demo program available until you master the system and become used to its interface. After you refined your skills using this automated trader, you can let FAP Turbo do the trading and analyzing while you relax and luxuriate in the fruits of your investments.

Forex MegaDroid Reviews & Rating

2009-11-15T06:49:00.001-08:00

Are you looking for reviews of the Forex MegaDroid software? If you have always been interested in automated currency trading systems, you will definitely be interested to see this. The number of people visiting the FX Megadroid website has been tremendous as more traders continue to recommend it after having good experiences with it.

1. How to Check if the Forex Megadroid Software is Worth the Money?

One thing you should check first is the winning percentage of the robot. Another equally important factor is the average amount of money that the software earns and loses for every winning and losing trade respectively. By understanding these 2 factors, you will immediately be able to analyze and conclude if the system is profitable or not.

Lastly, try to find out which currency pair the robot works best in. Most systems and software work best trading the EUR/USD pair since it is the largest and most liquid. However, there are others that are simply more profitable in tight and volatile markets as they can capitalize on the wild price swings.

2. How Much Money Do You Need to Invest In Order to Use Forex Megadroid?

One good thing about FX MegaDroid is that there is no need to purchase any more extra tools and indicators before you can start to use it. This is not always the case as there are other software retailers that will require you to buy additional software and indicators before their robots can work. Always find out if there are additional costs involved before you make the purchase.

3. Will the Forex MegaDroid Software Work for You?

I would say that I am very comfortable with its results so far, and I would highly recommend it to all currency traders. Before you decide if you want it, ensure that your PC processor can meet the requirements that the robot needs in order to run.

Best Forex Robot-Forex Broker Automate Autotrader

2009-11-15T06:48:00.000-08:00

This FAP turbo review 2009 will look into the FAP turbo expert counsel. This newsletter will establish if the claimed expert advisor robot is earning or not. This EA is a Metatrader 4 foreign-exchange trader machine. It is automated BTW. You set it onto 15-minute charts and just leave it to do its stuff. This EA has actually been tested on live markets. The testing started on Jan five, 2009 with a start up capital of £500. The author was using the EURGBP currency pair. It did not happen to just the writer but also to a number or folks, specifically traders of the same currency pair. See more about best forex trading robots compared below.

The loss was quite huge since 2 weeks’ worth of profit all went into smoke. What happened? Is the EA any good at all? How did such a loss happen? These were the questions raised because of this debacle. This FAP turbo review 2009 closely researched the whole scenario and was in a position to draw a favorable conclusion. This robot still can earn money. You may be thinking about why FAP turbo review 2009 still gave this expert aide a positive review after a particularly bad loss. The GBP was significantly influenced, making it really changeable. The EA itself has some issues, just like any application. It isn’t perfect. In fact, nothing is perfect. The lesson the author was in a position to get was that you can’t just blindly turn on the EA and leave it as it is. If there are signs of this kind of situation, you just need to turn off the system for that day and skip trading. This is not so bad. These categories of eventuality only occur often. See more about best forex trading robots compared below. If you are looking for a really good foreign exchange robot, then this robot is the one for you. See more about best forex trading robots compared below.

FAP Turbo is intended to automatically analyze trading information. It gives a real time trading results from 1 or 2 accounts and the trader can get updates every 15 minutes.See more about best forex trading robots compared below. Its user-friendly interface allows user without technical data to work them without most of a bother. FAP Turbo could work around the clock all week without the trader’s intervention and is known for it’s almost 95% positive turnout in its 9 years since it was first conceived and has only less than 0.45% negative results. It also has a video tutorial that may give you step by step instructions on how to correctly install and operate FAP Turbo. Once installed, this automated trader is all set to do the trading for you with accurate results and trustworthy information.

There are pro consultants to watch the trading and will start orders if you want it. See more about best forex trading robots compared below. If and ever a user encounters some troubleshooting issues with the software, FAP Turbo claims to a have a ready customer support system that will handle clients’ questions, except for the manual included in the package to help users install the system. See more about best forex trading robots compared below. You may use this manual as a reference to guide you along the way if online help is not readily available. Free updates for this programme are also offered. It also provides lifetime customer membership on their internet site. From here, you can get and download obligatory updates or program revision for your software. See more about best forex trading robots compared below. Like any ventures, cash trading comes with lots of hazards to take and avoid so it is better to first try the demo program available till you master the system and get used to its interface. After you refined your skills using this automated trader, you can let FAP Turbo do the trading and researching while you sit back and luxuriate in the fruits of your investments.

A Beginner’s Guide to Short-Term Trading: How to Maximize Profits in III Days to 3 Weeks

2009-11-15T06:46:00.000-08:00

SHORT-TERM TRADING: THE GOOD NEWS Maybe you’re a professional in your field, an entrepreneur, a retiree, a student, or a homemaker. You’ve probably observed the stock market and realized tidy profits can be made from the market’s current volatility. Whether you plan to trade on a full-time or part-time basis, the benefits of trading are fantastic.

If you make trading your full-time occupation, you can choose when, where, and if you choose to work. You can trade from any location, as long as your comp~ ter is hooked up to the Internet. Office politi~s? There are none. A persnickety boss? You’re the boss! Want to wear your bunny slippers to work? Do it! Catch the flu? Pull the covers over your head and stay in bed for as long as you want.
Got the time and money to take a week off? Have fun! If you’d rather trade
part-time, harmonize it with your regular job and add “luxury” money to your wallet. When you learn how to trade cautiously and wisely, your earnings may transform dreams into real rewards, such as the sailboat you always wanted, the vacation cottage in the mountains, or a college education for your children.

Here’s a benefit some folks don’t think of: When executed properly, short term trading can have lower risk than long-term investing. Many traditional buy-and-holders ride out bear markets fully invested, gritting their teeth while they watch their capital shrivel in value. Now you will know when to go “flat,” or close all of your positions. You’ll calmly put your holdings in cash during corrections and/or bear markets. And, you’ll have lots of money to shop with, when the bulls once again take control.

THE FLIP SIDE

The stock market is the most challenging arena on earth. It takes no prisoners. It’s a dog-eat-dog world, and only the fittest survive. Those who jump in without adequate knowledge or discipline usually get their heads handed to them in a hurry! To compete in this field, you have to be willing to persist and study hard. You have to cultivate the nerves of a bomb-detonator and develop the discipline of a marine corps drill sergeant. Short-term trading is riskier than socking your money into fixed income returns, such as Treasury bonds or money market funds. And the truth is, you will-especially at the beginning of the learning curve-experience losses. (The size of the losses are within your control.) Are you highly risk-averse? Does the thought of losing money send you running for the Maalox bottle? If so, you may want to choose a different investing avenue...

Top Forex Robot-Ea Forex Torrents

2009-11-15T06:44:00.000-08:00

This FAP turbo review 2009 will look into the FAP turbo expert advisor. This article is going to establish if the said expert advisor robot is earning or not. This EA is a Metatrader four foreign-exchange trader machine. It is automated BTW. You set it onto 15-minute charts and just leave it to do its stuff. This EA has actually been tested on live markets. See more about best forex trading robots compared below. The testing started on January 5, 2009 with a start up capital of £500. The author was using the EURGBP currency pair.

The loss was quite huge since two weeks’ worth of profit all went into smoke. What happened? Is the EA any good at all? How did such a loss happen? These were the questions raised due to this screw up. This robot still can earn money. You could be considering why FAP turbo review 2009 still gave this expert advisor a good review after a particularly bad loss. See more about best forex trading robots compared below. The lesson the writer was in a position to obtain was that you can’t just blindly switch on the EA and leave it as it is. If there are signs of this sort of situation, you only need to turn off the system for that day and skip trading. This isn’t so bad. See more about best forex trading robots compared below. For FAP turbo review 2009, this automated expert advisor is reasonably good.

FAP Turbo is meant to immediately research trading information. It gives a real-time trading results from 1 or 2 accounts and the trader can get updates every 15 mins.See more about best forex trading robots compared below. By using this software a trader isn’t needed to have a huge quantity of start-up capital to proceed. It has the lowest start up capital which is about $50. FAP Turbo could work fulltime all week without the trader’s intervention and is known for it’s nearly 95% positive turnout in its nine years since it was first conceived and has only less than 0.45% negative results. It also employs a very particular algorithm method that permits it to forestall losses and optimize its returns. And because it is also equipped with a strict risk management program, FAP Turbo reduces holes better. It also has a video tutorial that will give you step by step instructions on how to properly install and operate FAP Turbo. Once installed, this automated trader is all set to do the trading for you with correct results and dependable information.

If and ever a user encounters some troubleshooting Problems with the software, FAP Turbo claims to a have a ready client support system which will handle clients’ queries, apart from the instruction book included in the package to help users install the system. You may use this manual as a reference to lead you along the path if online help is not widely available. Free updates for this programme are also offered. It also provides lifetime customer membership on their online site. See more about best forex trading robots compared below. Like any ventures, money trading includes plenty of risks to take and avoid so it is better to first try the demo program available until you master the system and become used to its interface. After you refined your talents using this automated trader, you can let FAP Turbo do the trading and analyzing while you relax and luxuriate in the fruits of your investments.

Daily Report: Aussie Rises on Employment Report, Dollar Consolidates

2009-11-13T05:49:00.001-08:00

Australian dollar rises today on the back on unexpectedly good employment report. The job market expanded for another month by 24.5k in in October versus expectation of -10.1k contraction. Though, unemployment rate climbed from 5.7% to 5.8% as expected. AUD/USD soars to as high as 0.9368 so far. While upside momentum is diminishing a bit, there is still no clear sign of topping in Aussie yet and the current rise in AUD/USD might still extend further to a test of 2008 high of 0.9849. Against Euro, EUR/AUD, took out previous low of 1.6079 and dives to as low as 1.6017. We're still expecting further downside in the EUR/AUD cross towards lower trend line support at 1.5702 next.

Mid-Day Report: Sterling Pounded By BoE King's Comment

2009-11-13T05:47:00.000-08:00

Sterling was knocked down earlier today after BoE Governor King said that the bank is "completely open mind" on extension of the quantitative easing program. King believes the program is "working and the risk of another depression has "sharply diminished". Nevertheless, it "will be a long, hard path back" to a robust economy. Also, King reiterated that "The depreciation of sterling should lead to a recovery in economic activity." Sterling is sharply lower against Euro and dollar after the comments.

In he Quarterly Inflation Report, BoE forecasts for GDP growth and inflation outlook. These estimates were made based on assumptions that the benchmark interest rate, currently at 0.5%, rises to market expectation of 1.1% in 3Q10 and 2.1% at 1Q11, as well as asset purchase program of 200B pound. BOE also anticipated inflation will rise sharply in the near-term and exceed the target level of 2% in 2012.

Also released from UK, unemployment rate was unchanged at 7.8% in September, better than expectation of a rise to 8.0%. Claimant count also rose less than expected by 12.9k in October.

Elsewhere, dollar dips to new low on dovish comments from Fed officials. Dollar Fed Fisher said that inflation is likely to remain subdued for some time and the near-zero interest rates are appropriate. He said growth was likely to be "suboptimal" into 2010 and 2011, with unemployment a "vexing problem." San Francisco Fed Yellen said the prospect of a “jobless recovery” in a speech yesterday. Atlanta Fed Lockhart expects a "relatively subdued" growth pace this quarter and beyond.

BOE Upgraded Forecasts on Growth and Inflation

2009-11-13T05:46:00.000-08:00

At the quarterly Inflation Report in November, the Bank of England raised forecasts for GDP growth and inflation outlook as economy has expanded again and will not slip back into a recession. These estimates were made based on assumptions that the benchmark interest rate, currently at 0.5%, rises to market expectation of 1.1% in 3Q10 and 2.1% at 1Q11, as well as asset purchase program of 200B pound.

According to the quarterly Inflation Report, the UK's economy will undergo a 'slow recovery' and 'the outlook for inflation in the medium term is somewhat higher than the August report, reflecting the stronger projected distribution for GDP growth... the risks of inflation being above or below target are broadly balanced by the end of the forecast period'.

Although the nation's GDP surprisingly contract -0.4% qoq in 3Q09, the central bank revised up its GDP forecasts and signaled revisions of 3Q09 data. According to the BOE, upward revisions reflects the increased asset purchases, the lower interest rate path implied by market yields, the lower level of the exchange rate and a stronger outlook for world demand.

The BOE also anticipated inflation will rise sharply in the near-term and exceed the target level of 2% in 2012. According to the report, 'the risks of inflation being above or below the target are broadly balanced by the end of the forecast period. The outlook for inflation in the medium term is somewhat higher than in August, reflecting the stronger projected distribution for GDP growth'.

Australia Unemployment Rate Preview and EUD/AUD Outlook

2009-11-13T05:44:00.000-08:00

(November 12, Thu) Australia unemployment rate - October: After a surprising increase in payrolls (+40.6K) in September, a modest decline in employment (-10K) is expected in October. This should have pushed the unemployment rate +0.1 percentage points higher to 5.8%. Although economic recovery has been robust in Australia, unemployment rate may continue to rise from current level in coming months. However, the peak should be lower than what was expected by the market in the first half of the year.

In September, the number of persons looking for full-time work increased by 9500 to 497 400 and the number of persons looking for part-time work decreased by 13 300 to 161 200. This halted the recent trend that workers looked for part-time jobs due to reduction in full-time unemployment. We believe the number of workers looking for full-time jobs should have increased further in October.

Also, aggregate monthly hours worked increased 13.4 million hours to 1522.4 million hours in September. This was driven by improvement of economic conditions. The trend should have continued in October.

Daily Report: Yen Recovers on Risk Aversion, BoE & ECB Watched

2009-11-13T05:42:00.000-08:00

Yen recovers some ground today as Asians stocks dip after late selloff in US equities. Dollar follows by paring some of this week's losses as crude oil is back below 80 level while gold trades below 1090. Risk aversion would probably give the Japanese yen some further support as Japanese Nikkei closed below head and shoulder neckline support which should confirm medium term reversal. However, dollar's fate will continue to be tied between risk aversion and strength in gold.

FOMC statement overnight was largely inline with markets' expectations. Fed decided to leave the Fed funds rate unchanged at 0-0.25% and reiterated to keep it low for 'an extended period'. The Fed also listed conditions that warranted an unprecedentedly low level of interest rates: low rates of resource utilization, subdued inflation trends, and stable inflation expectations. In the meeting, policymakers also modestly upgraded its assessment of current conditions and reduced the amount of agency debt it purchased. These mildly positive factors partly offset the dovish tone of the post-meeting statement. More in FOMC Review: The Fed Disclosed Parameters For Making Rate Decisions

No Surprise from FOMC, Stocks Higher, Dollar Lower

2009-11-13T05:41:00.000-08:00

Fed left rates unchanged at 0-0.25% as widely expected. The wordings that rates will be kept at exceptionally low level for an "extended period" of time was practically unchanged. After all, there was nothing special from the FOMC statement. Markets struggled to find directional initially after the release but dollar bears won the battle as markets digested the statement. The greenback is sharply lower against European majors as well as commodity currencies while stocks managed to climb again after some retreats.

Intraday bias in the dollar index remains on the downside for the moment and fall from 76.82 might still extend further even though 61.8% retracement of 74.94 to 76.82 at 75.65 is already met. Persistent strength in Gold and crude oil would likely continue to pressure the greenback in general. Nevertheless, we'd continue to expect strong support above 74.94 low to conclude the pull back from 76.82 in the dollar index. That could be translated into a retest of recent high in EUR/USD, GBP/USD and AUD/USD though.

Mid-Day Report: Dollar Remains Pressured ahead of FOMC

2009-11-13T05:38:00.000-08:00

Dollar weaken sharply across the board today as Gold makes another record high of 1096 and is marching to 1100 level. Crude oil also follows by breaking 80 level too whole stocks rebounds strongly in general. ADP report showed the job market in private sector contracted -203k in October, slightly higher than expectation of -187k. Nevertheless, prior months' data was revised up from -254k to -227k. Challenger report also showed strong improvement of -50.7% fall in planned layoffs in October. Nevertheless, ISM non-manufacturing index missed expectation and fell slightly to 50.6 in October. Main focus now turns to FOMC rate decision and statement.

2009-11-11T08:39:00.000-08:00

To be a highly successful trader, novice traders must have a good trading plan. Trading multiple positions can be difficult without proper money management. Usually, traders will develop their own techniques of money management, based on their financial positions, trading styles, etc. One of the most popular strategies in money management is the Pyramid strategy, using which traders can effectively multiply Forex gains, with a relatively low risk.

Pyramiding is a strategy in which traders take advantage of high performing assets, by adding new positions at upper levels or doing what is called ‘averaging up.’ Traders trade multiple positions, after an increase in assets, with an intent to maximize profits. Averaging in a falling market is a very dangerous strategy, as the assets are getting lost, rather than being acquired. Pyramiding provides opportunities for traders to increase their positions, as the market goes up and at the same time, reduces their risk exposure.

For example, Mr. X sees an opportunity in the USD/JPY pair and wants to trade with a $10,000 amount by taking a long position at 95.00. He also decides to take a stop loss of 2%, just in case the market goes against him. Rather than putting all of his money in at once, he decides to trade with $5000 and after an hour, when the trade goes in his favor, he invests an additional $3000 at 95.62. Let’s say the pair rises sharply from thereon, he invests a further $2000 at 97.65, closing the trade at 99 with a profit of 400 pips.

Practical Examples

1. Long Positions – In an example of the US Dollar and Swiss Franc (USD/CHF), where traders played with multiple positions and adding new positions at each successive move to new highs:

In this example, the main entry points at which traders make long positions are; 1.0562, 1.0801, and 1.0916. Here, the exit point is 1.1567, at which all the long positions are closed.

2. Short Positions- Like with the long pyramiding strategy, traders can also hedge their risk using a short pyramiding strategy. The only difference will be that the strategy is applied when the market is in a downtrend.

This is again an example of the US Dollar and Swiss Franc (USD/CHF), where traders play with multiple positions and add new positions, at each successive move to new lows. In this example, the main entry points at which trader makes short positions are; 1.1700, 1.1673, and 1.1408. Here, the exit point is 1.10901 at which all the short positions are squared off.

Key Take aways

Trading multiple positions without a good trading plan is very difficult but traders can make this easy, with the help of the Pyramiding strategy through which, traders can add more positions to the trade, whilst lowering their risk exposure at the same time.

Risk to Reward Ratio Explained…

2009-11-11T08:37:00.000-08:00

Risk to reward ratio is used by traders and investors to
calculate the ratio of potential gain to potential loss
in a Forex trade. Mathematically, this ratio is calculated
by dividing the amount of the expected profit with the amount
of the assumed risk.

Risk to reward ratio = Risk (potential
loss*)/ Reward (Potential Gain**)

Before jumping into the market, traders should
know how to calculate the risk/reward ratio and how it is
applicable to trading. Risk is the most certain and dangerous
aspect of trading. Every trade carries some amount of risk
and it is essential for traders to know how much risk is
present in a particular trade and how he/she can minimize
that risk, so that their trading capital is protected. The
best way is to calculate it is by using the risk/reward
ratio.

For example,

1. If the trader is taking a risk of 1 pip to get the profit of 2 pips, then the risk/reward ratio is 1:2

2. If the trader is looking for a profit of 100 pips, with a tight stop loss of 75 pips, then the risk /reward ratio is 75:100 (75/100), which is 0.75.

3. If the trader is expected to earn the profit (reward)of $1320, with a stop loss of $350, then the risk /reward ratio is $1320:$350($1320/$350) or 3.7714:1.

How do you determine the risk/reward ratio?

Step 1 Risk – The very first step for a trader is to determine that how much risk is he/she is ready to assume on a particular trade. Stop loss is the best way through which traders calculate the risk value.

Step 2 Reward – Reward is the profit on an investment. Basically, this is the gain in currency pair value that a trader is hoping or attempting to earn from the currency price movement.

Example1. Let’s say a trader has an account with Easy-Forex and deposits $5000 in his/her account for 20:1 leverage. The trader can trade with $100000 with the help of leverage and decides to take a risk of only 2% of his/her trading capital, which is $100 ($5000 * 2%) and to book
profits, when the trading amount goes above $200. It means he/she will be out of the trade, once he/she is either -$100 or +$200.

Hence, Risk/Reward Ratio is = 100/200 = 1:2

Key Takeaways

Risks and reward are two sides of a single coin. Every one wants the reward side of the coin but nobody wants to accept the risk. Burying your head in the sand will not make the risk go away, but taking it out and doing a little homework will definitely make the risk hurt a lot less. The risk and reward ratio clears the loss that a trader will be looking at, from a potential Forex trade.

Crucial Money Management Guidelines

2009-11-11T08:35:00.000-08:00

Money is the opposite of the weather. Nobody talks about it, but everybody does something about it”
- Rebecca Johnson

“Managing money requires more skill than making it.”

The last phrase indicates the importance of money management in trading and this is the key skill for traders, if they intend to earn large profits from the Forex market.

Money Management is the fundamental element of successful trading. It is the process of planning, organizing, and controlling money related matters in a Forex trading ’strategy,’ in which money management plays a crucial role in helping traders to establish a trading plan, work out their trading capital and make investments in accordance to their risk bearing capacity. Money management also helps in determining the ideal risk exposure for individuals.

Generally, money management is related to the allocation of funds, more specifically; diversification and portfolio management. This is the most important aspect of trading that every trader must know, to preserve capital and make gains.

Risk is something that nobody wants to see in their portfolio, but unfortunately it is present in every financial portfolio or a trading decision. To minimize or hedge the risks; money management is very vital.

How does it relate to Forex trading?

There is a popular quote in trading that goes like; “Never trade with money which you cannot afford to lose.” This quote is absolutely applicable here; novice traders must follow this rule by not trading in markets unnecessarily (or overtrading), without any clear direction or strategy. The importance of money management can be summarized as follows:-

1. Important in forming trading strategies - Money management is very useful in making trading strategies. A trading system with proper money management can provide mammoth returns to traders in the long term.

2. Helpful in managing risk – Managing risk is not difficult but it is nonetheless critical. Diversification and trading rules can be implemented to manage risk and reduce the downsides that are associated with a trade. For example, according to expert traders; averaging does not make sense in a falling market but it is good when the market goes up. Hence, when the market falls, they exit from long positions by taking a tight stop loss. On the other hand, if the market moves in their favor, they start adding new positions on every upward move.

3. Helps in defensive trading – For a beginner, money management is very helpful in defensive trading. Novice traders can use trading objectives, limits and strategies to remain within a moderate zone, without going overboard with aggressive and risky trades, while they still make good returns.

Key Takeaways

Based on the principles of money management, traders can stop trading if their portfolio or individual pair goes below a particular percentage of stop loss. The main motive behind money management is to place a limit on the likelihood and extent of losses. With the help of money management, traders can increase the number of winning positions and reduce losing positions, while balancing their investments with their risk.

Currency Trading Summary

2009-11-11T08:23:00.000-08:00

U.S. Dollar Trading (USD) with stocks rallying for a 4th day the market went back into 'risk on' mode and the USD was on the back foot. Weekly Jobless claims were 512k vs. 530k previously. Q3 Productivity at 9.5% was very strong vs. 6.5% forecast. In US Stocks, DJIA +203 points closing at 10005, S&P +20 points closing at 1066 and NASDAQ +49 points closing at 2105. Looking ahead, October Non Farm Payrolls forecast at -175k vs. -263k previously. The October Unemployment rate is forecast at 9.9% vs. 9.8% previously.

The Euro (EUR) continued to find strength on dips as US stocks soared and the ECB was relatively upbeat at their ECB meeting were they held rates at 1.0%. The pair failed to track the gains completely on Wall st. as the market pauses ahead of the US Unemployment data tonight. Overall the EUR/USD traded with a low of 1.4810 and a high of 1.4920 before closing at 1.4880. looking ahead, September Industrial Orders are forecast at 1% vs. 1.45 previously.

The Japanese Yen (JPY) was strong is Asia as the Nikkei fell but then was sold for most of the day as the US had its biggest rally in 2 months. AUD/JPY and GBP/JPY led the rebound but the market was well contained again as the event risk of the NFP today contained risk appetite. Overall the USDJPY traded with a low of 89.97 and a high of 90.84 before closing the day around 90.75 in the New York session. Looking ahead, September Leading Indicators previously at 0.8%.

The Sterling (GBP) shot higher as the BoE increased the Asset purchase program by 25bn vs. 50bn forecast. The BoE held rates at 0.5%. The market found resistance above 1.6600 and settled below the figure. EUR/GBP support was in the low 0.89's. GBP/JPY reclaimed the 150 Yen level. Overall the GBP/USD traded with a low of 1.6639 and a high of 1.6464 before closing the day at 1.6580 in the New York session. Looking ahead, UK PPI Output prices are forecast at 0.3% vs. 0.5% m/m previously.

The Australian Dollar (AUD) good data could not help the Aussie rally in Asia as AUD/JPY selling dragged the pair to day lows before a change in sentiment pushed the pair higher once again in the US. September Trade Balance at -1.85bn vs. -2.1bn forecast. Overall the AUD/USD traded with a low of 0.9023 and a high of 0.9127 before closing the US session at 0.9105. Looking ahead, RBA Monetary Policy Statement.

Oil & Gold (XAU) consolidated gains settling just under $1100 level. Overall trading with a low of USD$1083 and high of USD$1095 before ending the New York session at USD$1091 an ounce. Fell back below $80 a barrel on profit taking after recent 3 day rally. Crude Oil was down $0.78 ending the New York session at $79.62.

WORLD FOREX: Euro Hovers Around $1.50 As Global Stocks Rally

2009-11-09T07:35:00.001-08:00

NEW YORK (Dow Jones)--The euro remained strong against the dollar in early New York trading Monday, hovering around the psychologically important $1.50 mark, after rising global stocks suggested markets would shake off last week's disappointing U.S. jobs data and continue to load up on risk.

Finance ministers and central bankers at this weekend's meeting of the Group of 20 industrialized and developing nations didn't mention currencies in their official communique, removing what had been a possible obstacle to placing bets on higher-yielding currencies.

If U.S. stocks follow the lead of Asian and European exchanges, the euro and other higher-yielding currencies are likely to extend their gains against the dollar. U.S. stocks are expected to open higher.

In early morning trading, the euro was at $1.4991 from $1.4844 late Friday, according to EBS via CQG. The dollar was at Y89.95 from Y89.96, while the euro was at Y134.80 from Y133.53. The U.K. pound was at $1.6773 from $1.6608

The Dollar Index, a trade-weighted basket of six currencies, was at 75.109 from 75.784 late Friday. The index was flirting with nearly 15-month lows.

Positive Australian housing data overnight sent investors into the Australian dollar, which lifted other higher-yielding currencies. The Australian dollar hit a two-week high, at $0.9299, on the data that showed Australian housing-finance approvals rose 5.1% on the month in September, more than the 3% rise expected.

The continuing positive pace of Australia's economic rebound added to the view that the Reserve Bank of Australia may deliver more increases to its key interest rates in coming months, boosting investor sentiment for the currency.

Australia's economic turnaround contrasts with the disappointing U.S. jobs data reported Friday, which showed unemployment rose above 10%, its highest level in nearly three decades.

The weekend's G-20 meeting in Scotland also proved uneventful for financial markets. The group didn't mention currencies at all in its final communique. Some analysts had expected exchange rates would be discussed.

More direction appeared to come from comments by U.S. Treasury Secretary Timothy Geithner and U.K. Prime Minister Gordon Brown, who warned against ending financial-crisis support programs prematurely. In other words, there won't be any rush to tighten monetary policy, which should continue to weigh on the low-yielding U.S. dollar.

There are no key U.S. data Monday, which means the euro and other higher-yielding currencies should track the direction of the stock market.

(Nicholas Hastings in London contributed to this article.)

-By Bradley Davis, Dow Jones Newswires; 212-416-2654;

How to Calculate Forex Trading Profits and Losses

2009-11-09T07:33:00.001-08:00

IMPORTANT KEY PIONTS

2009-11-09T07:30:00.000-08:00

Some people spend all day talking to their brokers. Soros “prefers to talk to a select few people who can be really helpful ….” Then you need to think and read and reflect.
To be successful, you need leisure. You need time hanging heavily on your hands [to talk to people, read, and think].
If you have an investment thesis you like, run it by people who support the other side of the argument. See if you still like the thesis afterward.
Basically, the way Soros operates is to have a thesis and then he tests it in the market. If the market goes against his position and he feels uneasy (e.g. gets a backache), he cuts his losses.
What he took was basic information from various sources and kind of mulched it in his mind. Then he would come up with a thesis that most of the time was valid.
When Soros believed he was right … no investment position was too large. Holding back was for wimps. The worst error in Soros’ book was not being too bold.
The key to investing is knowing how to survive. That means at times playing conservatively, cutting losses when necessary and keeping a large portion of one’s portfolio out of play.
If you are doing poorly, retrench. Don’t try to recoup. And when you start again, start small.
To be in the game, you have to be willing to endure the pain.
Perhaps Soros’ most distinctive feature, the trait that explained his investment talents the best, was his ability to gain membership in a very ‘exclusive ‘ club that included the leadership of the international community…. Such encounters clearly gave Soros an advantage over other investors.
Invest first and then investigate … form a hypothesis, take a toehold position to test the hypothesis, and wait for the market to prove you are right or wrong.

Discretionary Traders

2009-11-09T07:28:00.003-08:00

In browsing around the web I often encounter discussions of the merits of a particular trade and opinions about the direction of a market. I know that the traders who voice these opinions have good intentions and much of the discussions could be helpful to the person receiving the information. (Some of these discussions are on our Forum.) However the provider of the opinion must be very careful that he doesn’t start believing too strongly in his position because he has made the mistake of going public with it.

This is an important psychological issue that I seldom see discussed. Taking losses is always difficult and the reluctance to promptly acknowledge that we are on the wrong side of the market is probably the single most costly error a trader can make. Even under the best of conditions we hate to take losses. Publicly advocating a particular trade or the direction of a market just makes being wrong all the more painful and harder to accept. If we make it a policy to go around advocating the merits of our trades it will only make it harder to recognize when we are wrong.

Successfull forex traders

2009-11-09T07:28:00.001-08:00

Would you like to enjoy the lifestyle of successful forex traders? If you were to split foreign exchange traders into two groups – the successful and the less than successful – could you identify those characteristics which separate the two groups?

It does not really matter what we do in life, which includes foreign exchange trading, but, whatever we do, one thing that will have more affect on our success than anything else we do will be setting goals.

It is a simple fact that the human mind works best when it is given a roadmap to follow and, by setting a goal, you start building your roadmap by clearly defining the end point of your journey. However fixing a destination is not sufficient and you will also need to define the route which you are going to follow to get to your destination. Here is an example.

Stock Trading

2009-11-09T07:27:00.001-08:00

Stock Trading
1. Taking responsibility of your capital
2. Cut your losses early and let your Profits Run
3. Discipline
4. Too much information
5. Do not marry your trades
6. Do not bet the farm

1. Taking responsibility of your capital
It is interesting how many people are happy to place their savings and funds in other peoples hands, accept the losses as its easier to blame someone else than to take responsibility of those funds ourselves.

Foreign Exchange Market

2009-11-09T07:26:00.002-08:00

There are various different ways in which traders can place orders to buy and sell currencies and this gives foreign exchange traders considerable flexibility in planning their trading strategies and allows them to both maximize their profits and minimize their losses.

Principle of profiting in exchange rates

2009-11-09T07:26:00.001-08:00

The easiest way to demonstrate the ability to profit from Forex trading as the exchange rate rises and falls is to look at some examples. Let’s start by looking at how you might profit when exchange rates rise.

Let’s assume that you believe that the UK Pound is going to rise against the US Dollar and that you can buy GBP/USD at 1.8730. We’ll also assume that you are trading a standard InterBank lot of 100,000 so that 100,000 UK Pounds will cost 187,300 US Dollars.

Forex Stop Loss | Forex Trading Tips

2009-11-08T02:35:00.001-08:00

Weekly Forex and equity update

2009-11-08T02:33:00.001-08:00

FOREX Training | FOREX Trading | FOREX Video

2009-11-08T02:31:00.000-08:00

Advantages of Trading Currencies

2009-11-06T09:45:00.000-08:00

Trading currencies (also known as foreign exchange, forex or fx) has many advantages over trading stocks and futures for both day trading and swing trading. Some are:

1. Long Trading Hours

A currency trader can pick and choose convenient trading hours because the market is open from Sunday at 5:00 PM EST to Friday at 4:30 PM EST.

2. Low Account Minimums

At some firms, you can day trade currencies with relatively low account minimums (may not be appropriate for all investors).

3. No Commissions

Trading currencies with our firm is commission free. Currency Trading USA gets compensated through the Bid/Ask spread instead.

4. Tight Bid/Ask Spreads

5. Flexible Margin Requirements

100:1 margin (1%) for forex trading is greater than for stocks and futures. Increasing leverage increases risk.

6. No Limit up / limit down

Unlike in futures, FX trading is not suspended when the prices move too much in one direction.

Learn Currency Trading And Profit

2009-11-06T09:42:00.000-08:00

When trying to learn currency trading at first, it was difficult. This hard phase soon went away after finding out about forex scalping. Forex scalping would have to be the quickest style to learn, and great for the beginner. In just a matter of a few weeks a new trader can start to make profits. After I learned scalping I incorporated this one method the gurus swear by, and it has lead to my trading account doubling every month!

When learn currency trading? At first I only spent a few hours here and there on my forex. This was soon to end after realizing that I needed to put more time into it to get any kind of results. Dedication took over, and results started accelerating. Once a trader realizes that they need to keep them self in a hardcore trader mindset and put time in, their success will come. Adding this one method to my trading and being dedicated resulted in my trading account doubling in a month!

Where can I learn currency trading when there are so many sources to learn from? This can sometimes be a hard obstacle for a beginner. Good information on the internet can sometimes be hard to find, especially if it has to do with making money. The big traders never like to give out their tactics and they pretend that no one knows about them. Once I discovered this one dominating method that they use, I put it to the test in my scalping. In the first two weeks I ended up doubling my trading account!

Where to learn currency trading when there is so much different information available? Sometimes this is a hard obstacle for a new trader. Finding out where to learn and what info is actually good is a skill itself. Believe it or not, the big traders that make huge profits have techniques that they have been hiding for years. They try to keep it to them selves! Once I discovered this one true method that they use to dominate, I added it to my scalping for a result of my massive profits today!

Finding how to learn currency trading for a steady income is challenging with so many options. There are many ways out there that can make money in the same market, but it is something different to have a method that consistently works. After discovering the shocking method that the pros have been using for years I had to test it out. After a few weeks I doubled my trading account! There was no turning back.

If your trades just aren’t pulling the cash you need, you must check out how the “Big Wigs” learn currency trading and own the market! Stop letting the “Big Wigs” feed you bull, take action today and discover untold secrets to learn currency trading today!

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Is the Fed Hurting the Dollar in the Long-Term?

2009-11-06T09:39:00.000-08:00

By now, everyone is surely familiar with the measures that the Federal Reserve Bank and US Treasury (under the auspices of the US government) have unveiled to blunt the impact of the credit crisis. The accompanying debate, regrettably, has dwelled on matters of efficacy; in other words, are such measures adequate to stimulate the economy and prevent it from sliding into long-term recession? Only a few analysts have taken to pondering the long-term monetary implications of such policy-making. This is to be expected, since those who call for restraint have always been outnumbered by those favoring bold (and expensive) action. Besides, the Fed has always had critics, namely those who advocate a return to gold standards But perhaps this time is different. In recent memory, the stakes have never been so high, and the global economy has never been so imbalanced. Accordingly, the Fed and the Treasury must be careful that in treating the economic crisis, they don’t inadvertently damage the very foundation of the US economy.

Can China Avoid a Post-Olympic Economic Downturn?

2009-11-06T09:33:00.000-08:00

Economics analysis indicates that countries that host the Olympic Games typically suffer from economic decline and currency depreciation in the months following its conclusion. The "so-called ‘Valley Effect’ is mainly caused by a dramatic increase in investment in the pre-Olympics stage, accompanied by a boom in consumption and revenues, [but] investment and consumption shrink in the post-Olympic stage." On the surface, China fits this mould, as it spent upwards of $40 Billion building venues and upgrading infrastructure in preparation for the Games. At the same time, most economists agreed that the Chinese economy was both more robust and more diverse than previous hosts, and could even receive an economic boost from the Games, as a result of increased media exposure and tourism.

The first bump in the road came in the form of a tainted products scandels, which led to the recall of dozens of items, including toys, medicines, and most recently, dairy products. Then came the credit crisis, which exploded in the US and quickly spread to the rest of the world. While the implications for China are not entirely clear (for reasons that will be discussed below), it seems almost certain that the economy will take a hit. In which case, it probably won’t be possible to disentangle the (negative) economic impact associated with the Olympics from the general economic downturn, but I don’t imagine this is of much concern to investors, anyway. Given the rising prominence of China within the framework of the global ecomony analysts are watching with baited breath to see if and how China can avoid a dreaded economic downturn.

Forex Trading Strategies and Systems used in Professional Forex Trading

2009-10-30T09:40:00.000-07:00

" The Ultimate Forex Trading Strategies and Systems Delivering Profits Week After Week"

Learn these Forex trading strategies and Forex systems on 4 hour and daily charts, or if your time is really limited, you can trade just the Daily charts. Learn this simple strategy which is desgined to scalp for a quick 100 pips or leave the trade on for hours or even overnight to make 200 or or more pips.

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2009-10-30T09:39:00.001-07:00

This comprehensive trading ebook is designed to train forex traders to read price action and trade the forex market like real professionals.

Does your trading system lose money? Its time for a huge change in your trading!. Join the group that make money consistently. If you’re a beginner and don’t know where to start, try thee daily forex trading strategies first. Stop looking for perfect mechanical forex system, and learn to read raw price action.

Maybe you’ve bought a forex system or used a trading strategy before and your trading results still weren’t up to scratch, most likely because they where useless curve fitted systems that have no use in real world trading. The con artists all over the internet never tell you the truth, back tested results are useless!.

to learn a real forex tading method based on pure price patterns which is simple and effective.

2009-10-30T09:38:00.000-07:00

This ebook is filled with solid forex strategies, similar to those used by banks and financial institutions. It's going to teach you powerfull trading setups, which we have used to profit considerably and consistently. We dont teach a bogus one hit wonder forex system, We are talking about you going away from this ebook with a concrete plan of action , powerfull forex system in hand, ready to make serious money. You will have unlikley seen these trading strategies taught anywhere.

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2009-10-30T09:37:00.000-07:00

You need to learn new strategies and systems in order to further your education and trading knowledge. You now have the ability to learn how to trade from a full time forex trader and start to identify high profitability trading setups.

You will realised a dramatic change in your trading approach. By trading price action only, you will join the group that make money consistently. If you’re a beginner and don’t know where to start, try these strategies first because they will save your ass big time!

Maybe you’ve bought forex trading systems or learned strategies or method before and your trading results still weren’t up to scratch. We have the solution you need. We want to teach you simple forex entry setups that are easy to identify, because we really believe trading should be kept simple.

The best forex trading methods are not 100% mechanical. We dont believe in b.s mechanical robots and the like. There is some decision making involved with these forex strategies. Once things for sure, you can count on these tested trading systems to select the right entries and exits. With repetition comes mastery. You will be able to see patterns and formations over time.

Stop searching for the holy grail forex system, it does not exist./font>

2009-10-30T09:34:00.000-07:00

One of the most frustrating modes to be in is searching for years for a trading method that grows your trading account balance. You’ll find some people trying con you all over the internet. We are here to tell you its all rubbish. If you're going to change things, then the time to get moving is now. Learn skills, learn methods, learn entry setups with a proven edge in the market. We have discovered a proven way to siphon pips out of the forex market, but you still have to use my head, its not perfect, and it's automatic.. nothing is.

A forex trading method with a good winning percentage will be rewarding psychologically, keeps your morale high and is enjoyable to trade. A string of profits will build your confidence. See our trade of the week page which is updated at the end of each trading week. If you are looking for a forex system with no losing trades, forget trading and find another business or hobby. My priority is to keep losses small and wins should be larger than losses.

US Dollar Will Have to Weigh 3Q GDP for Fundamental and Risk Impact

2009-10-27T10:38:00.001-07:00

What little strength the dollar seems to find during the trading week seems to ultimately be swept away by the financial markets’ primary fundamental driver – sentiment. Whether or not the dollar makes for the ideal funding currency to the recuperating carry trade, it has already been put into that niche; and the rationale of the situation will not be reevaluated until either the trend stalls or there is a prominent change in the dollar’s fundamental makeup. There is the sense that this currency has resigned to a seeming permanence in its role as the FX whipping boy and the steady decline to fresh 14-month lows day after day. However, while the rise in risk appetite has maintained its bearing, it has a lost much of its fervor. This could signal the first stage of a reversal in yield appetite (and the subsequent recovery in the US dollar); and it could open the door for the big ticket 3Q GDP release to finally loosen sentiment’s hold over price action.

So far, we have absorbed two notable, third quarter growth readings from major economies; the results couldn’t have shown any greater contrast. Representing the strong face of the emerging market, China reported its economy grew 8.9 percent year-over-year through the third quarter. On the other end of the spectrum, the United Kingdom surprised the market by reporting a 0.4 percent contraction through the three month period ending with September and extending the economy’s worst recession on record. Will the US draw greater similarities to its British or Chinese counterpart? Economists’ expectations are impressive. A projected 3.2 percent annualized pace of growth through the quarter would shed the stigma of recession and bolster hope for a solid recovery on what would be the most significant pace of growth in two years. Gauging whether these projections are reasonable and determining whether the world’s largest economy is on a true pace of expansion, we need to breakdown the major sectors. Government spending plugged the whole but consumer spending, capital investment and a housing recovery are essential for material growth. Housing sales have certainly recovered and construction activity is stabilizing. Earnings through the second and third quarters suggest businesses will pick up production and start spending once gain. Yet, accounting for approximately three quarters of economic output, consumer spending is the backbone of the economy. Confidence seems to have already turned the corner; but consumption and planned purchases are both shaky.

Adding another complication to the high level release, we need to determine whether the dollar will produce a straightforward response to the data or the currency will default to its safe haven role. This is a complicated question; and it depends as much as what is happening with the capital markets heading into the release as the actual data itself. If there is a consistent rise to new heights in optimism, the sentiment aspect will likely win out. Alternatively, if risk appetite happens to commence a meaningful retracement beforehand, the relief for the greenback should allow for an intuitive response.

Keeping everything in perspective though; it is important to realize that the dollar does not have the characteristics of a long-term funding currency. Depressed market rates and benchmark yields are temporary; and there is little reason to doubt policy officials will not be able to work down deficits. Should the US return to growth with this 3Q reading, roles will start to reverse as fundamental realism dawns. On the other hand, a disappointment like that born of the UK’s status report could strengthen the unwanted correlation in the short-term.

Euro Top Remains Elusive, but ECB Rate Forecasts May Bring Reversal

2009-10-27T10:36:00.000-07:00

The Euro continued its dominance against the US Dollar for the third consecutive week of trading, closing above the psychologically significant $1.50 mark for the first time in 14 months. Unlike previous weeks, however, the single currency persevered against the safe-haven US Dollar despite relatively lackluster performance in the S&P 500 and other key risk sentiment barometers. Last week we argued that the high-flying EURUSD would increasingly need support from risky assets to continue its impressive rallies. Yet the S&P 500 finished the week 0.75 percent lower and yet the Euro traded higher.

A surprisingly bullish streak for key European economic data seemingly made the difference, and fundamental forecasts for domestic growth remain quite bullish. Whether this is enough to propel the Euro to fresh highs is perhaps another matter, however, and a relatively important string of economic releases could force substantive shifts in Euro forecasts.

Impressive German IFO Business Confidence figures and Euro Zone Purchasing Manager Index numbers set the stage for respectable recovery across broad swaths of the regional economy. Indeed, sanguine growth forecasts have led traders to price in relatively substantial interest rate hikes from the European Central Bank. The lure of higher yields has undoubtedly played a part in Euro/US Dollar rallies, but the extent of Euro appreciation leaves it at clear risk of pullback. ECB watchers will keep a close eye on the coming week’s German and Euro Zone Consumer Price Index figures for important surprises. Current consensus forecasts call for yet another negative year-over-year change in Euro Zone Consumer Prices, but the rate of contraction is expected to narrow to a meager 0.1 percent. Suffice it to say, any material disappointments could make a considerable dent on ECB interest rate expectations. Wednesday’s German CPI figures could subsequently set the tone for near-term Euro/US dollar trading.

Traders will otherwise keep a close watch on global risky asset classes—especially as the Euro’s correlation to the S&P 500 trades near record highs. The US Dow Jones Industrial Average’s close below the psychologically significant 10,000 mark suggests that financial market risk appetite is not quite as robust as previously believed. Yet we would hardly call for a market top without a more substantive pullback across a broad swath of indicators. FX Options market volatility expectations have come down since last week’s peak, but it should be yet another week of eventful price action out of the Euro and US Dollar in the face of noteworthy event risk. - DR

Japanese Yen on Pace for Further Losses Against Euro, US Dollar

2009-10-27T10:33:00.000-07:00

The Japanese Yen fell against major forex counterparts for the third week in a row, slipping further on outperformance across key risky asset classes. Yet the 20-day correlation between the US Dollar/Japanese Yen pair and S&P 500 actually turned negative for only the second time in two years—emphasizing ongoing shifts in FX market dynamics. The Yen has long been the go-to currency during times of market stress and, by extension, the first to fall through financial market booms. As the lowest-yielding currency in the industrialized world, investors aggressively borrowed JPY to fund investments in sources of higher income. More recently however, the US Dollar has taken the dubious honor of the cheapest currency to borrow across global financial markets. The surprising shift goes a long way in explaining the USDJPY pair’s inverse correlation to key risky assets, and it will likely remain a major factor for the Japanese Yen through the foreseeable future.

Week in and week out, we have repeated that financial market risk sentiment and the trajectory of the S&P 500 would be the major determinant of USDJPY price action. Of course, the substantive shift in risk correlations would suggest USDJPY moves may depend on other fundamental factors. Against other counterparts, the Yen’s continued losses show little investor interest in buying and holding the low-yielding currency. Given its extraordinarily low yield, holding Japanese Yen is an expensive proposition; the trader must pay higher interest rates to receive paltry JPY yields.

A cursory look at a Yen chart will show you that the currency will tend to lose more often than it gains—except to note that its rallies are far sharper than its declines. That is to say, FX traders avoid buying Yen unless they absolutely have to. And when they are forced to cover JPY short positions, they typically do so in a hurry. Given these JPY trading dynamics, we believe that the Japanese Yen is likely to continue drifting lower against the Euro, British Pound, Australian Dollar, and New Zealand Dollar. The wildcard remains whether we can expect a noteworthy correction in broader financial market risk sentiment.

Impressive performance and fresh highs across key barometers leaves markets at prime risk of pullback. Yet too many traders have gone bust in trying to time a market top. Until we see plausible signs of market turnaround, we have little reason to believe that the Japanese Yen may recover against higher-yielders. The admittedly unpredictable dynamics between the US Dollar and Japanese Yen make the USDJPY an especially challenging pair to trade. If nothing else, however, its recently bullish momentum is likely to keep it aloft through the coming week of trade

British Pound Decline Could Continue on Falling BOE Rate Forecasts

2009-10-27T10:28:00.000-07:00

The British pound racked up heavy losses on Friday, tumbling 1 percent against the Japanese yen and nearly 2 percent against the US dollar, after UK GDP unexpectedly showed that the nation did not emerge from recession during Q3, and instead, the economy contracted for the sixth straight quarter at a rate of -0.4 percent. Likewise, the annual rate of growth edged up to -5.2 percent from -5.5 percent, falling short of expectations for a move to -4.6 percent. A breakdown of the GDP report showed that nearly every UK business sector remained in recession, as the services industry component fell by 0.2 percent while the production industry component tumbled 0.7 percent.

Going forward, it’s worthwhile to note that GDP is a lagging indicator and the release’s impact on interest rate expectations is the most important part. Indeed, the British pound fell sharply because Credit Suisse overnight index swaps shifted to price in a 10 percent chance of a 25 basis point cut by the BOE during their next meeting. Furthermore, expectations for rate increases over the next 12 months fell to 88.1 basis points from 93.4 basis points. While the BOE hasn’t really given any indication of their collective stand on quantitative easing (QE) at this juncture, we do know that the Monetary Policy Committee (MPC) is looking for reasons to justify either winding down or expanding their target level of asset purchases. The minutes from their October policy meeting showed that the "forecast round ahead of the November Inflation Report would provide an opportunity to assess more fully how the medium-term outlook for activity and inflation had evolved since August," and if the latest economic data has any bearing on the MPC’s bias, it looks there is still some bearish potential for the British pound.

Looking ahead to the next week, UK data shouldn’t have too much of an impact on rate expectations, but there is always the lingering risk that BOE MPC members will make comments that could impact trade. Thursday is really the only day with scheduled indicators on hand. Net consumer credit in the UK is anticipated to remain negative for the third straight month at -0.2 billion pounds, but on the other hand, UK mortgage approvals are projected to hit a more than one-year high of 53,600, suggesting that lending levels remain low but housing demand is growing. Meanwhile, GfK consumer confidence is forecasted to climb to a nearly two-year high of -14 from -16, indicating that sentiment is still pessimistic but improving, albeit at a slow pace. All told, where GBPUSD goes in the coming week will likely have more to do with US dollar trends than UK fundamental forces, but a break below the 50 SMA at 1.6265 opens the door to much steeper declines. – TB

Swiss Franc Looks To Test Parity, Will SNB Intervene?

2009-10-27T10:26:00.000-07:00

The Swiss Franc trended higher against the dollar over the past week as risk sentiment continued to drive price direction. Strong corporate earnings from Apple, JP Morgan and DuPont sparked risk appetite to start the week but concerns over valuations led to diminishing returns for bullish investors as equities struggled to hold onto gains. A disappointing U.K.3Q GDP reading, -0.4% versus 0.2%, has raised concerns that other G-7 nations will follow with dour growth results. The U.S. GDP report will cross the wires next week and a similar result could lead to support for the pair. Although Swiss fundamentals have little sway over Franc direction, the 2.3% drop in exports and 3.1% gain in imports during September were negative signs for the economy. Swiss Franc strength has been a concern for the SNB as it continues to deter foreign demand and foster deflation.

Two significant fundamental releases are on this week’s economic docket with the UBS consumption indicator and the KoF leading indicator on tap. Rising unemployment has weighed on domestic demand and although the economy has shown signs of emerging from its recession, the labor market remains weak as declining orders keep companies in cost cutting mode. Nevertheless, the outlook for the next six months is forecasted to rise to 1.10 from 0.85 on the back of an improving global economy. Regardless, traders should take their cue from risk sentiment with a week full of earnings reports ahead and the U.S. growth numbers. A test of parity is a possibility this week if risk appetite returns, but reversals can often follow tests of significant psychological levels. Also, traders must beware of possible intervention from the Swiss National Bank as they continue to fight against Franc appreciation and its negative implications for the economy. - JR

Canadian Dollar May Come Under Pressure Ahead of BOC Decision

2009-10-27T10:25:00.001-07:00

The Canadian dollar eased back on Friday after the release of the nation’s consumer price index (CPI) fell for the fourth straight month in September, the longest series since 1953. Indeed, the annual CPI rate fell to -0.9 percent, but on the other hand, the annual rate of the Bank of Canada’s core CPI eased back less than expected to 1.5 percent from 1.6 percent, highlighting the impact of volatile commodity prices on inflation reports in the nation. Furthermore, the data sets the stage for the Canadian dollar’s main source of event risk this coming week: the Bank of Canada’s rate decision.

The BOC is expected to leave rates unchanged at 0.25 percent once again. After the Bank left rates unchanged on September 10, they said that they would maintain a neutral stance through June 2010, and the rest of the statement was relatively optimistic as they said “GDP growth in the second half of 2009 could be stronger than…projected in July.” However, they also indicated that the Canadian dollar’s strength remained a threat to not only growth, but the return of inflation back to target. Overall, indications that the Bank still sees downside risks for inflation could weigh on the Canadian dollar, but as we’ve seen in the past, the currency is more responsive to changes in the economic outlook.

Other potential source of volatility for the Canadian dollar in the coming week comes from oil prices, which DailyFX Strategist John Kicklighter noted is showing signs of reversal, retail sales – which are forecasted to rise by a slight 0.1 percent – and the BOC’s Monetary Policy Report. However, it is that policy report that should draw the most attention as the BOC is likely to include updated outlooks on growth and inflation. That said, the key to price action will be revisions, as upward changes to GDP will lead the markets to aggressively price in rate increases in 2010. From a technical perspective, daily USDCAD charts show that RSI rose from oversold levels, which has typically yielded at least a few days worth of gains since the start of 2009. - TB

Australian Dollar Outlook Remains Bullish on Interest Rate Expectations

2009-10-27T10:23:00.000-07:00

The Australian dollar rose to a fresh yearly high of 0.9326 against the greenback and the higher-yielding currency may continue to appreciate going into the following month as investors speculate the Reserve Bank of Australia to tighten policy throughout the second-half of the year. Credit Suisse overnight index swaps shows market participants are pricing a 131% chance for a 25bp rate hike in November and expect the central bank to raise borrowing costs by more than 200bp over the next 12-months, and the Aussie may continue to retrace the sell-off from the previous year as policy makers hold and improved outlook for the economy.

The Reserve Bank of Australia Minutes said that the “very expansionary setting of policy was no longer necessary” as the $1T economy skirts the global recession, and went onto say that it may be “imprudent” for the central bank to hold the interest rate at the 49-year low as policy makers maintain their dual mandate to ensure price stability while fostering full-employment. Moreover, the central bank held a hawkish tone and said keeping borrowing costs at “very low levels” could raise the risks for inflation, and said that the “trough in inflation was significantly higher than earlier thought.” Moreover, RBA Assistant Governor Philip Lowe stated that the rebound in economic activity would “gradually lead to a normalization of interest rates,” and said that the country is likely to have “a higher average exchange rate than we’ve had over the past couple of decades.” However, the central bank expects the marked appreciation in the Australian dollar to temper the risks for inflation, and the central bank may adopt a wait-and-see approach over the remainder of the year as the outlook for global growth remains uncertain.

Nevertheless, the economic docket for the following week is likely to spark increased volatility for the Australian dollar and may drag on the exchange rate as market participants anticipate price pressures to weaken further in the second-half of the year. Economists forecast consumer prices to grow at an annual pace of 1.2% in the third quarter after rising 1.5% during the three-months through June, while producer prices are project to fall to an annualized rate of 0.5% from 2.1% in the second-quarter. At the same time, private-sector credit is anticipated to increase 0.2% in September following the 0.1% rise in the previous month, while bank lending is expected to grow at an annualized pace of 2.0% from the previous year. As a result, the slew of mixed data may leave the AUD/USD confined in a narrow range as investors weigh the outlook for future policy but nevertheless, as risk trends continue to dictate price action in the currency market, a rise in risk appetite may lead the high-yielding currency to hold above 0.9300 over the following week. - DS

New Zealand Dollar Rally May Stall as RBNZ Disappoints on Rates

2009-10-27T10:20:00.000-07:00

The interest rate announcement tops the data docket, with economists calling for the Reserve Bank of New Zealand to hold rates at the record-low 2.5%. The markets seem to be in agreement, with a Credit Suisse index of priced-in expectations showing traders see no chance of a hike this time around. To that effect, all eyes will be focused on the statement accompanying the release, with investors looking to gauge whether the timetable for the withdrawal of monetary stimulus has been accelerated from the previously given “latter part of 2010” estimate after consumer prices unexpectedly surged in the third quarter.

The hawks may be in for a disappointment however considering policymakers will be wary of acting on rates to protect the still very fragile export sector. Indeed, both the central bank and government have been very vocal about the detrimental effects of a higher Kiwi dollar in driving away foreign demand. Overseas sales make up over 30% of the economy’s total output, so any policies that stand to hurt firms catering to foreign markets will likely stunt the fledgling economic recovery of recent months. Appropriately enough, September’s Trade Balance figures are set to be released less than two hours after the central bank announcement crosses the wires, with exports expected to match the 23-year record drop recorded in the previous month even as the overall deficit narrows on lackluster import demand.

In fact, the RBNZ may have already embarked on a somewhat covert tightening campaign aimed at checking inflationary pressure while minimizing the impact on the NZD exchange rate. The central bank “leaked” an announcement that it would end some of its emergency lending programs enacted amid the credit crunch in November, a fact that it did not officially confirm via an official news release until about a day later. This move will gradually slow the flow of liquidity into the economy, reducing the pace of money supply growth and acting against inflation. Policymakers’ approach to the announcement suggests they were consciously trying to avoid a snow-ball effect that would send the New Zealand Dollar steeply higher. It also hints that perhaps this approach to tightening will be seen as sufficient to stick with rates at current levels until the second half of next year as scheduled.

Looking beyond the economic calendar, the outlook for risk sentiment is likely to remain a key catalyst for price action. Indeed, a trade weighted average of the New Zealand Dollar’s value remains over 95% correlated with the MSCI World Stock Index as traders’ appetite for returns boosts stocks, commodities and high-yielding currencies alike. To that effect, traders will keep a keen eye on a handful of high profile third-quarter earnings reports including those from consumer goods giant Procter & Gamble, big oil names including Exxon Mobil and Chevron, and US Steel.

The Latest Online Forex Trader Brokers System

2009-07-22T11:32:00.001-07:00

Some brokers are exceedingly distinguished people to their clients, but there are those that are not. Brokers may work for insurance companies, real state, and even companies which supply trading systems. They are influential people which many individuals can rely on whenever they would need help of some sort. But a broker system differs.

The online forex trading broker system has a principal function of supplying clients with trading platforms. Trading platforms are well-known as the place to trade. There are also forex broker systems which supply training and programs which educate clients on how to invest money and how forex trading is being completed.

The training that is provided by these broker systems help several trade investors to reduce risks whilst maximizing profits. Investors therefore are able to profit a lot from these broker systems due to the facr they may also be able to acquire forex advice, help, knowledge, currency analysis, stock, and the coming market. Some also supply trading ideas and daily picks from newsletters.

The final goal of almost any forex broker system is to make an investor succeed. And this can only be achieved with a system having accomplished professional teachers and advisors who are able to give directional market tuition and forex training.

Beginners of the trade should be made aware that forex trading is a high risk investment. The currency market offers a lot of opportunity to earn huge amounts of profits but at the same time coupled with a lot of risks. Currency trading can give you a fortune in minutes, days and hours. But the sad truth is that it can also be lost just at the same time.

Currency forecasting is not an easy task, which is why many traders should not forget to gain knowledge of the trade first before they decide on making a trade. An intensive forex trading course can help in the learning of all the in and outs of trading. The pros can supply you with the needed educational knowledge before entering the real world of forex.

You can find a complete forex trading course that is of reasonable cost either online or in a traditional class. Look around, or you can ask around for a good trading course available.

Additional services are now provided by many broker systems to draw the attention of prospects and clients. Forex is considered as a sophisticated game, which is why you need a forex broker system.

Get scrolling updates and information for the individual currency trader. Federal Reserve’s intention about the interest rate is also required by traders, and a broker system will help in finding and providing this information. Professional traders repeatedly write newsletters that can be of good use by other forex traders, they will be able to supply information about technical and fundamental analysis. Set up alerts are sometimes provided to give traders certain ideas for them to make more money.

Broker systems are entrusted by many individuals to buy and/or sell on their behalf. Make sure that the broker is registered as an FCM with the CFTC. FCM stands for futures commission merchant; and CFTC is commodity futures trading commission.

First, you would need to have an account before you can set up a broker system. You can find a lot of them online, but make sure that you choose one wisely. You must ask about the fees being charged.

Friends and co-workers are a good source of trusted brokers; ask about the broker’s information and the troubles that they encountered, if any.

Online forex broker systems provide different services, but they should particularly be quick in buying or selling and automatic execution. The ’spread’ should be clearly identified, whether variable or fixed.

Pay thought to even the littlest thing before signing up for a forex broker system. The margin terms are also of utmost consideration. Ask how margins are calculated and margin requirements.

The broker system should be trustworthy and its efficiency as to performance should not be questionable. The trading software used by the trader is quite indispensable, that is why you should first see all the available options for you. Take advantage of free demos, this will help you greatly in making an informed decision.

Check all the policies of the forex broker system. Read especially those in fine print; oftentimes it is the most important part that the investor fails to read.

Advice On Learning Forex Trading

2009-07-22T11:31:00.000-07:00

Business these days is a very tough task and it pays to know exactly what your doing. This is especially to true when dealing with the forex market. It is indispensable that learning forex trading and all that is associated with it to best of your ability in order to succeed. The various stakes and players. When you choose to learn forex trading you need to know exactly what your dealing with such as

* The value of the currency
* The various factors that will affect the value of the currency
* The trading strategies
* All the different market trends.

Knowing these will greatly help your cause. The fundamentals to forex trading is solid research. As it’s such a tough market then getting your hands on a good course to help in your knowledge of learning forex trading will help.

Why Should You Look For A Good Forex Trading Course?

Forex trading courses will help in teaching you the ways in which to predict or chart the continuous movement in the market as well as when the perfect time to buy or sell a commodity is. It will help you in getting familiar with various forex trading terminologies and the process of trading.

Because forex trading is done in real time and decisions are done on the spot, a trader should be emotionally equipped and prepared to handle the demands, challenges and the stress of the market. And these, one can learn in a forex trading education.

What To Look For in Forex Trading Courses

The Basics. A good forex trading education should include in its program the basics on margins, types of orders and leveraging as these are essential in the forex market transactions. It should teach the basic terminologies, the types of analyses being used, the software and tools and other such important things as charting and leverage. These are essential as the trader learns when to cut back and minimize his losses as well as gain profit.

Analysis. It should also teach you how to analyze common mistakes and at the same time, the ways to avoid such mistakes. Basic to a forex trading course is a detailed discussion on doing technical and fundamental analysis and tools.

Values. More than the theories and the basics involved, a good forex trading education should teach you proper money management and the development of a proper trading disposition and psychology. As the stakes are upped, a trader may become too emotionally involved. It is important that a forex trading course develops the appropriate values needed in money trading, such as discipline, patience and commitment.

Experience. A good forex trading course should provide real life experience through apprenticeship. There is no better teacher than experience, they say, and as forex trading is as real as it can get, forex courses should offer avenues where the student can practice trading. Some courses have live conference rooms or boards where the trader can learn to trade in real time or, in some cases, in a simulated environment. These experiences should also have a one-on-one feedback and forums for discussion and exchange of information and lessons.

For those who’d like to get a good grasp of the market and the rules of the game, there are online sites offering courses and workshops on forex trading. These sites offer courses on risk and money management, trading strategies, technical analysis, market trends and networking. There are also tutorials on the latest softwares and tools being used. There are also online sites that offer lifetime membership and support. Some online schools allow their students to retake the course for updates on the newest trends and strategies. You can try www.trainingacademy.com, www.realtimeforex.com, www.go-forex.net, www.forexmentor.com and www.fxcm.com.

Innovations

With the advent of the Internet, there’s already online forex trading, a system that allows corporations and players in the game to do business virtually. With online forex trading, one can check and monitor the value of the currencies, and even trade directly on the internet. It offers trading of almost 15 currencies, and with the growing number of online traders, it spells more possibilities and more earnings.

Of course, nothing beats the real thing. And a successful forex trader’s skill and knowledge is developed with continued experience. A forex trading education may or may benefit you, but it sure can spell a difference. With the forex market’s volatile environment and fast-paced transactions, one must be fully-equipped with the appropriate tools, knowledge, skill and disposition. The key here is to know the market. Of course, don’t forget to read up on the market, learn how to compare the currency values and generally become a better money manager.

Reasons Why Forex Trading Courses Are So Important

2009-07-22T11:30:00.002-07:00

From ancient times, people have been engaged in different types of businesses. Buying, and selling of commodities, is still the backbone of any business. Businesses have not only provided bread and butter to generations but have also helped build many great nations.

Trading is also one of the very old ways of doing business. Long ago, people traded goods for other goods. Later on, goods were traded for services and services were traded for money.

Forex trading is just one of the many forms of trading business. Simply put, forex trading is the trading of different currencies in the world. Known as the largest financial market in the world, forex trading is the least regulated market which provides absolute liquidity to most investors.

In the beginning forex trading seems very easy. But in reality, it’s quite difficult. To make money in forex trading, you should be able to buy currencies at a cheaper rate and sell them later at a higher rate. If you don’t have proper knowledge about it, you will lose a whole lot of money.

To become a pro in forex trading, you will need to learn the basics and then practice with some advanced learning tools. If you do it right, it won’t be long when you will become a master.

There are many forex trading courses that you can choose from. They vary not only by the content but also by the audience type. For example, you can choose to attend a forex trading class traditionally (inside the classroom) or online over Internet. There are courses designed for beginners, intermediate level and even for professional traders.

Whichever course you choose, you will definitely learn more and benefit from it. Practicing what you learn is also important. Although the actual trading requires additional expenses on your part, the amount that you’ll be spending will be doubled or even tripled once you do your actual forex trade.

Trading courses offered to the new forex traders teaches all the basic principles and aspects of forex trading. There are many institutions which offer the latest software and tools used in forex trading. Apart from detail on forex trading, many institutions educate the first time traders about the difference between equities and forex trading. They show how the pros make use of different instruments when doing the actual trade, which helps the beginner to choose the best possible instrument.

Since trading in forex goes on across the world, you can actually engage in forex trading twenty four hours a day and six days a week. You can just imagine how much money you can make in very little time; but this can only be realized if you attend forex trading courses.

Some new traders initially enjoy and benefit from forex trading even without attending any proper course. But in due time, they realize that they can lose a lot of money if they don’t seek professional help. As you can guess, a little help from outside can prove to be very useful.

Forex trading requires a lot of knowledge about the market itself, and if you hardly have any knowledge about it, you’re in big trouble. People who want to engage in business naturally want to make money, and to achieve that in forex trading, you must have a good grip of the different aspects of the trade.

One of the very important traits in doing forex trading is discipline. It’s not enough to have your own plan; you also need to stick to it at all times. With the help of adequate technical tools, you can go a very long way.

It would be wise to find a course in physical offices so that you can get the most professional and comprehensive learning experience. Check if they also offer study materials to be used at home. The opportunity brought about by the different courses offered in the market is infinite, and any trader can highly benefit from it.

Many forex trading courses allow you to have training with real quotes and data. You can learn the proper skills in risk management, and how you to preserve your capital. You will know how to make your very own business plan, and you will be able to improve on you plan as per your instructor’s comments.

Instructors of such courses are among the best; they have all the experience and knowledge about the trade. Almost any physical office which offers forex trading courses allows their students to do networking, which means they can have alliances and collaborations outside the four walls of the classroom.

To enroll yourself into any trading course requires background study and careful evaluation of the trading institution that provides the course. You can always ask your friends and colleagues who are already into forex trading about good forex trading course institutions. Or you can do some research online in case you want to attend classes on the Internet.

Remember, learning will always make the difference if you want to succeed in forex trading. So make a right decision when you choose right trading institute.

How Forex Trading Software Helps Traders

2009-07-22T11:30:00.001-07:00

In many ways, the Forex trading software has made forex markets carry out the trades with efficiency and ease. The ability of software to integrate different currencies in their respective markets worldwide has made it possible for forex traders to do business 24 hours a day.

Two kinds of forex trading software are available today. The first is known as service side software. This software is an online version of software program in which the users log in using their forex market accounts’ user ids and passwords and connect to the trading portal or platform. Then they can execute any operation associated with the accounts that they wanted.

Another type of forex trading software is known as client side software. This type of software, which is installed by technicians in the computers of the traders, is a program that runs on users’ computers and allows them to execute different transactions.

Both varieties of forex trading software are popular among the traders since they allow them to conduct business transactions across the world any time of the day or night.

Forex trading software provides a number of other benefits to the traders than the basic ability to perform transactions. It includes the relationships of currencies to trading and vice versa. One of the greatest benefits is the real time accessibility on forex quotes. It can also provide useful information about past behavior of real time quotes and rates. The charting mechanism is also a very good advantage. It can help the trader to gain excellent profits if it is properly interpreted.

One advantage of forex trading software is that it can embed charting software and provide access to various charts and graphs that assist the traders in making decisions about their transactions. With the complete background information, the traders get the correct details they need in making the best possible decision.

Another important aspect of Forex trading software is the security it provides to traders. The software usually operates at various security layers that would be difficult for hackers to crack into. Due to the exposure of forex trading all over the world, this security is much needed when huge traffic volumes occur in the forex market. The general security of the forex trading software ensures that the personal data of the traders are also protected.

Security in the software works at 2 levels- data integrity and privacy. This prevents the hackers from getting into the trader’s account or change currency rates during a high amount transaction.

Forex trading software also allows the traders to see the entire forex market conditions at once. This is necessary because without the overall knowledge of the forex market, one can not decide the best time to perform transactions.

It also helps in increasing forex sales volumes in the market. Take note, forex market can be sometimes difficult to determine. You need to understand every detail to select the best to make it work for you. As much as possible, learn the latest forex trading software and apply it. Most of the software available today is a two-in-one. They include both the trading software and useful charting software. You can gain a lot if you are able to interpret and use the charts correctly.

Although forex trading is very popular today, make sure that you employ the right software in order to reach your goal. The advantages of software programs that were mentioned above are useless if it is not properly reviewed. Remember that web technology continuously increases in popularity becoming the latest trading avenue.

There are numerous internet sites which are providing different software programs that can allow the traders to do forex trading. However, make sure that the software has accuracy. When you acquire certain software as your tool, try it first. Allow dry runs or testing especially when decision making is concerned. There are lots of forex trading sites that are offering trial runs of their products. The software can determine the currency rates each day.

Besides such useful tools, some software contains some other intelligent features. It helps the traders analyze data and predict market behaviors. It can also involve graph utilization which shows the rising and falling of currencies.

Most forex trading sites allow the users to conduct secure transactions in a number of international markets. The sellers and buyers worldwide use this flexibility to participate in the trading regardless of time as long as it is still market hours.

A special note to novice traders: do not worry if you are not sure. You can avail services such as accessing the expert’s sites for advice. These experts help the newcomers in analyzing and understanding the behavior of the market. As the new traders become more mature and knowledgeable, they make wiser decisions regarding the best currency to trade and become successful. You can see why the trading software is so useful and important for all types of traders.

About Forex Mobile Trading Software

2009-07-22T11:29:00.001-07:00

The Forex market, which has made a number of people rich in a very short of time, is the largest and the most liquid financial market in the world. With transactions occurring worth up to 2 trillion dollars each trading day, who wouldn’t want to join and make big bucks?

Sure, not many people knew about Forex earlier, but now a lot of people are beginning to realize that this particular market can really give them the opportunity to make lots of money. If you learn the tact of this business and do your homework right, it can turn you into a millionaire overnight.

Of course, with great rewards come greater risks too. Do not forget to consider that the Forex market also has its risk. You have to consider that aside from the fact that it can give you a chance to earn a lot of money, you should also realize that the risk is also equally great, maybe even more. It is a fact that people who have entered this financial market without the right knowledge and skills have lost a lot of money.

In the past, as per its strict policies, the Forex market allowed only large financial institutions and multinational companies to participate in trading. However, thanks to the advancement of communications technology and the availability of high speed Internet, the Forex market have opened its doors to individual traders and brokers. Even a common man like you and me can now trade in the Forex market without any trouble.

Because of all the advantages that the Forex market offers, a lot of people have entered this very large liquid financial market with the ambition of making it big. Though it doesn’t take much time to learn the basics of how to trade currencies, it needs extra efforts to learn about the different strategies and skills essential for successful trading.

The basic trading rule in the Forex market is that you have to buy when the price is low and sell when the price of the particular currency you are holding is high. If you already have this basic knowledge about the Forex trading, the next thing you should do is to learn and practice different trading techniques.

As such for performing Forex trading, you need just 3 things- a computer that is dedicated for your Forex trades, a fast and reliable Internet connection to avoid slippages and Forex trading software to help you with your trades in the Forex market.

The Forex trading software is used as a trading platform and can easily be downloaded from the internet for a certain fee. You can also use online software that many online Forex brokers offer. All you need to do is register and open an account with a Forex brokerage website. After you open an active and funded account, you will then be granted access to their Forex trading software that you can use in your Forex trades.

You must ensure that the software has the following features:
Real time updates of prices to avoid slippages.
Show prices of currency pairs.
Shows charts and should have charting features.
Stop loss button for risk management.
Open Positions window
Closed positions window
Account window

Other than these, many software companies offer real time alerts and tools for strategic planning. You can also consider few other key features such as guaranteed stop-loss rate and rate freezing, before making a decision about the software.

Since the Forex market is a very risky market, you should get the best software with the best features. In order to know which software can suit your needs, you only have to try out different software programs by opening a dummy account with the Forex brokerage company. Most Forex brokerage companies online can offer you a free trial of their software to enable you to determine if the software suits your needs or not.

Forex trading is a complex business and must be performed carefully. You need to have right tools and techniques as much as up-to-date knowledge of the Forex trading market. Thus choosing the right software becomes the key to effortless and successful trading.

Tips On Forex Trading Signal Software

2009-07-22T11:28:00.001-07:00

If I ask you to name the five most important things in your life without which you can not possibly survive, you would probably count money in. Money is indeed an absolute necessity these days to live a comfortable life. You need money not only for your basic needs such as feeding your family, but also to buy things that help you to live a happy and content life.

There are various ways to earn money and it depends on an individual to choose the right way of making money. Some people work for an organization and trade their services for money, while others prefer running independent businesses to earn the money they need.

However, there is another way to make money which is called trading. People trade in a number of things, such as stock trades, commodity trades etc. But those who trade in money make millions of dollars in a very short time.

This kind of trade is called Forex trading. In the Forex market, you buy or sell currencies. Forex is the largest and the most liquid financial market in the world that operates 24 hours a day and produces monetary transactions that amount up to 2 trillion dollars in a single trading day.

One distinguishing fact of the Forex market is that, unlike the stock market, the Forex market has no centralized location. Markets across the world have different time for opening and closing which means that this type of trading is open 24 hours a day. Trade starts in Australia and ends the next day in New York.

It’s a fact that the Forex market is one of the best money making financial markets in the world. A lot of people have made millions of dollars in the Forex market and that too in a very short amount of time. Some people consider the Forex market as one of the best career that anyone can ever get into. And for this reason, people have quit their regular jobs and ventured in the Forex market to get a piece of this huge pie.

However, as you can guess, along with the money making advantage, there is equal amount of risk in the Forex trading, which you can not overlook. As the rate of the potential returns increases in any market, the risk of losing money increases too. It is a known fact that many people who ventured into this very large financial market have lost a lot of money and some even suffered huge financial losses. This is why you should think hard about it first before you even consider entering this financial market that offer huge potential to make money and also equally risky market.

Sound financial and market knowledge is an important aspect to any type trading. To be successful in Forex market, you should have the right knowledge and skills to trade currency. The basics of a Forex market is that you should buy low and sell high in order to make a profit. In addition, there are many different strategies involved using which you can earn money even when the market is down. You should also practice few techniques that help minimize the losses.

With time, trading in Forex has become possible from the comfort of your home. Thanks to the improvement and the advancement in communications technology, everyone who has investment potential and forex trading skills can now trade online and earn money from home.

All you need is a fast computer dedicated to your Forex trades alone and a fast Internet connection to avoid lags in updates in prices. You will also need a software program which acts as trading platform and assists you with your trades in the Forex market.

Obtaining the software program is easy. When you register and open a Forex account with your preferred Forex broker, the broker or the brokerage company will provide you with either an online version of software program or a downloadable and installable software program that you can install and run from your computer.

As there are many software programs available for Forex trading, it is important to choose the right one to suit your needs. You have to determine if the software has all the necessary things to assist you with your trades. For example, a good Forex trading software program should allow you to see real time charts, real time price updates and also let you use different tools that you need to effectively trade in the Forex market.

Safety and reliability are the two other points that you should consider in making the right choice for Forex trading software. The software should save you from hacker attacks or malicious transactions and should offer a safe channel for data exchange. The software should allow you to back up your data and also to restore it back in case of any damage or problem.

Information from this article should give you a basic understanding of Forex trading and guide you in obtaining resources for trading effectively in the Forex market. You can rest assured that with the right knowledge, skills, and the right Forex trading software, you can increase your chances in making a profit and decrease the risk of losing money in Forex market.

US Dollar Losing Its Economic, Safety And Reserve Advantages

2009-03-24T08:26:00.000-07:00

Fundamental Outlook for US Dollar: Bearish

- UN panel and Russia prepared to recommend abandoning the dollar as the world’s reserve currency
- Fed holds rates, announces quantitative easing and a sizable increase to MBS purchases
- Industrial production runs its worst slump since 1975 suggesting the worst of the recession has yet to be seen

The US dollar was put through the ringer this past week as market participants were left to wonder where the currency would find strength as its primary, fundamental pillars started to give way. There is no better gauge for the health of the greenback than price action itself. The dollar index suffered a 345 pip decline through Friday’s close – the biggest weekly drop in years. And, though the retracement of the past two weeks has unwound a significant share of the previous eight months’ of bullish trending; the pull back may not stop there. As fear settles and global policy officials attempt to stabilize the financial and economic crises, the market will grow increasingly critical of the stalwart dollar. With a clear field of view, traders will take weight of the United States position in the recession curve; the unit’s status as a safe haven; and more importantly, its role as the world’s reserve currency.

Of these three critical themes, the threat to the dollar’s standing as the world’s primary store of wealth is the most elemental. One of the primary reasons (aside from being backed by the largest economy in the world) the greenback has dominated as the world’s most liquid and actively traded currency is the fact that nearly ever central bank and financial player transacts through it. With this standardization, the dollar lines reserves, is used to purchase commodities and is used as a benchmark for currency pegs among other things. This is why suggestions that the Commission of Experts on International Financial Reform panel will recommend to the UN that the dollar be abandoned as the world’s currency reserve carry’s so incendiary. This is not the first time an official or group has called for such a move; but the argument has not been made under the level of stress the markets are currently experience. With so many ‘too-big-to-fail’ market structures and participants having succumbed to this crisis, there is little reason why such an out-dated norm will not be reconsidered. In fact, the argument for a basket of currencies taking the place of sole dollar is so persuasive that the topic will also come up at the G-20 summit on April 2nd – where anything official will likely take place.

In the meantime, fundamental traders will focus their attentions on the greenback’s fading appeal as a key safe haven currency. It was the height of the panic back in October that really cemented the currency’s place as a harbor for the world’s money. Fear left investors with one concern; and that was capital preservation. Offering the deepest pool of liquidity and the backing of the world’s largest government, US Treasuries (and by proxy, the dollar) was bought at a furious pace. However, in the months that have past, the market has cooled off. Traders and money managers are still worried about protecting their funds; but they are doing so with a mind for potential return and the long-term viability of their investments. Over the past weeks, the US has had to inflate its balance sheet, take up the reins of quantitative easing, take over two corporate credit unions and battle a deepening recession. This is not the laundry list of a safe, long-term investment.

And, when these two major market dynamics are not in play, dollar traders will fall back on the now-ubiquitous recession contest. Negative growth is universal problem; but there are nonetheless leaders and laggards in this race. After the first, aggressive round of policy action from US officials, market participants were ready to believe that the US was perhaps ahead of the recession curve. However, as the economy nears depression levels and promising alternatives emerged (like Australia), this notion began to fade. This is where next week’s docket comes into play. Final GDP, recent consumer spending and housing data will all add to the debate. - JK

Euro Forecast to Gain Against US Dollar, but Doubts Remain

2009-03-24T08:22:00.000-07:00

Fundamental Outlook for Euro This Week: Bearish

- Euro surges against US Dollar following Fed Announcement
- Is the Euro/US Dollar downtrend over as a result?
- Euro remains very strongly correlated to S&P 500

Euro forecasts against the US Dollar saw noticeable improvement on the week, as the USD suddenly finds itself at a clear disadvantage against key counterparts. The US Federal Reserve sparked a massive dollar tumble when it announced aggressive quantitative easing measures through its most recent meeting. The EUR/USD subsequently posted a record single-day gain, and momentum clearly remains in the European currency’s favor. Global investors have suddenly lost interest in the US Dollar as a safe-haven store of value, and the abrupt shift implies that the Euro could appreciate further at the US Dollar’s expense.

The coming week promises a steady string of European economic data, and any major surprises could alter short-term outlook for the domestic currency. First on the ledger, Germany and the broader Euro Zone will release key Purchasing Managers Index results for manufacturing and services indices. PMI releases have not necessarily forced noteworthy Euro/US Dollar volatility in the past, but they remain important leading indicators on the relative health of economic activity. Medium to long-term outlook for domestic economies and the euro itself could potentially shift on major shocks. Any surprises in subsequent German IFO, Consumer Confidence, and Consumer Price Index releases could have similarly noteworthy effects on medium-term Euro/US Dollar outlook.

Recent US Fed announcements leave the Euro at relative advantage versus the US Dollar, but we remain mindful that the Euro Zone offers comparable structural risks for the EMU currency. The Fed announced that it bought an almost-unimaginable $1.25 trillion dollars in US Treasuries and Mortgage-Backed Securities—tantamount to running the printing presses on the US currency. Yet Euro Zone structural deficiencies offer palpable political risks that cannot be ignored.

Traders will have to decide whether real risks of US Dollar devaluation outweigh those of EMU instability. For now it seems that markets are far more concerned with excessive US Dollar supply and that it has lost its status as a safe-haven store of value. Yet sentiment could just as easily shift on deterioration in EU relations. We believe that the euro could continue to gain against the US Dollar through the near term, but it is critical to note the danger of an abrupt destabilization in EMU country dynamics. - DR

Yen Weakness May Continue As BoJ Buys Government Bonds

2009-03-24T08:19:00.000-07:00

Fundamental Outlook for Japanese Yen: Bearish

- Japan’s Tertiary Index unexpectedly rose 0.4%, on increased demand for information and communication services
- BoJ left interest rates unchanged at 0.1%, but announced an increase of government bond purchases by 29%

The Japanese yen lost ground against most of the major currencies as the Bank of Japan announced that it would increase its buying of government debt to 21.6 trillion yen. The statement announcing the board's decision said economic conditions in Japan have "deteriorated significantly and are likely to continue deteriorating for the time being." However, the Yen did gain ground against the dollar as the Fed announced a larger purchasing plan which sent the greenback into a free fall.

The news wasn’t all gloomy for the Japanese economy as the Tertiary index improved by 0.4% as demand for information and communication services improved. Economists were expecting a 0.5% decline following December’s -1.6% print. This is a good sign for domestic growth; the Japanese economy remains dependent on exports which continue to suffer from a drop in global demand. Additionally, a 11.5% drop in Nationwide department store sales demonstrates that consumers are continuing to retrench in the face of a deepening recession—especially as growth contracted 13.4% in the fourth quarter.

The Yen has started to give back some of its gains against the dollar and has fallen to its lowest level against the Euro on the year. We may continue to see Yen weakness as the Japanese government continues to buy government bonds. The rapid deterioration of the Japanese economy may necessitate increased efforts from the central bank which will continue to be a weighing factor for the currency. The fundamental calendar won’t have the same event risk as last week, but we may get some insight into how long the economy may continue to weaken. Although the Adjusted Merchandise trade balance is expected to show a narrowing of the deficit, it will be in negative territory for an eight month. Inflation is expected to have fallen 0.1% in February which will continue to fuel deflation concerns and support the case for further quantitative easing. The BoJ’s minutes could also hint at further easing and add to bearish Yen sentiment. - JR

British Pound to Fall as Data Signals Deepening Recession

2009-03-24T08:18:00.000-07:00

Fundamental Outlook for British Pound: Bearish

- UK Jobless Claims Rise by Most on Record
- Bank of England Unanimous On Quantitative Easing
- UK House Prices Fall at Record Pace for Second Month in March

The British Pound faces substantial downside risks next week as a heavy dollop of negative economic data points to ever-deepening recession. Last week, we saw sterling come under substantial selling pressure after Jobless Claims jumped much more than expected and the Claimant Count ticked to 4.3% (versus forecasts of 4.0%) in February. Next week’s Retail Sales is very much a part of the same picture: as companies trim jobs, disposable incomes dwindle and consumer spending falters. Expectations call for receipts to add 2.5% in the year to February, down from 3.6% in the preceding month. Private consumption is the largest component of overall economic growth, so weakness here bodes ill for Britain’s ability to climb out of the current downturn. Indeed, the IMF has predicted that this time around the UK will see the worst recession among the G7 nations.

Anemic economic growth is set to bring inflation lower, with growth in consumer prices expected to slow to just 2.6% in the year to February, the lowest in 11 months. Minutes from the last meeting of the Bank of England revealed that policymakers voted unanimously to cut interest rates by 50 basis points and begin quantitative easing, committing to spend 75 billion pounds to buy government bonds fearing that price growth may slip well below the 2% target rate this year. The week aptly closes with the release of the final revision of fourth-quarter GDP figures, with that release set to confirm that the economy shred a whopping 1.5% in the three months to December 2008, the worst in nearly three decades.

The US Dollar Index is showing signs of bouncing higher having found support at a rising trend line established from the lows set last July, hinting that feverish selling of the greenback may have run its course and will not be propping up GBPUSD for much longer. This opens the door for sterling to bear the full brunt of rapidly deteriorating data, suggesting the bears will be out in force in the near-term.

Swiss Franc to Reverse Gains as Risky Assets Lose Momentum

2009-03-24T08:16:00.000-07:00

Fundamental Outlook for Swiss Franc: Bearish

- Swiss Government Lowers Growth Forecasts as Trade Conditions Falter
- Retail Spending Weakens as Recession Deepens
- Investor Confidence Improves for a Fifth Month, Exports Decline

With close to nothing on the economic calendar, the Swiss Franc is likely to take directional cues from trends in risky assets and the US Dollar in the week ahead. Indeed, the Franc was the second-best performing currency last week, adding 5.2% against the greenback despite dour economic data and a commitment to intervene against further appreciation by the central bank. The US dollar selloff began with a rebound in risky assets and accelerated as the US Federal Reserve said it will buy $300 billion in Treasuries to lower long-term borrowing costs, weighing on yields paid on dollar-denominated assets.

Looking ahead, early evidence suggests that feverish US dollar selling may be close to over and will not be propping up the Franc against the greenback for much longer. There are substantial reasons to believe that the current rebound in risk appetite temporary, leaving the door open for a return to safety-driven demand for the US Dollar in the near term. The global growth outlook for 2009 remains grim, with the IMF calling for the biggest contraction in worldwide output since World War II. This bodes ill for demand and will almost certainly be reflected in disappointing earnings reports for some months to come. As the initial shockwave from the Fed’s actions dissipates, focus is likely to return to the bigger picture, putting renewed downward pressure on stock exchanges.

The technical outlook is supportive: the MSCI World Stock Index has been confined in a downward sloping channel since mid-October. The current rally began with a bounce at the bottom of this formation, and while there is still room to go until the channel top is tested, its downward slope argues for a bearish bias on risky assets for the time being. Topside resistance is further bolstered by the presence of a falling trend line established from the highs in May of last year. Together these will present a substantial hurdle for risky assets, suggesting further losses lie ahead. Turning to the US Dollar Index, prices are in range of key support at a rising trend line established from the lows set last July. This is reinforced by the 38.2% Fibonacci retracement of the 07/15/08 – 03/04/09 rally at 82.65, bolstering the case for a rebound.

All told, traders may see lingering support for the Swiss Franc through some of the coming week as the correction in risky assets and the US dollar continues to play out, but the scope of these catalysts looks decidedly limited and a return to downward momentum for the mountain nation’s currency is likely ahead. - IS

Canadian Dollar Underperforms on Fundamental Forecast

2009-03-24T08:14:00.000-07:00

Fundamental Outlook for Canadian Dollar: Bearish

- Overextended futures positioning boosts Canadian Dollar Outlook
- Canadian CPI inflation unexpectedly accelerates, boosting interest rate outlook

The Canadian dollar gained sharply against its US namesake on recent Federal Reserve actions, but the Loonie nonetheless underperformed major G10 counterparts on mixed results in domestic economic data. Canadian dollar forecasts remain muted as traders take stock of economic developments in the highly trade-dependent country. Indeed, recent data releases pointed to continued weakness in key export-related industries, and domestic consumption has fallen sharply as a result. Looking to the week ahead, a relatively empty economic calendar promises little in the way of foreseeable event risk. Yet it will be important to watch developments in the US economy and effects on the Canadian dollar.

Canada’s strong dependence on international trade leaves its currency at the mercy of international demand, and forecasts for a global economic recession bode poorly for the downtrodden Canadian dollar. According to 2008 estimates, Canadian exports amount to approximately 30 percent of domestic GDP. Recent January figures show that said exports plunged 18.2 percent on a year-over-year basis. Clearly, a continuation in the ongoing trend will have substantial effects on domestic GDP.

Such bearish outlook for global consumption makes it difficult to feel bullish on the downtrodden Canadian dollar, but its continued resilience against the USD suggests that bulls have not yet given up the fight. Likewise significant, clear downward momentum in the US Dollar could maintain downward pressure on the USD/CAD exchange rate—offsetting relative Canadian Dollar weakness. It will be critical to watch whether US dollar concerns will outweigh clear risks of sustained Canadian economic contraction. – DR

Australian Dollar May Benefit As Inflation Concerns Rise

2009-03-24T08:13:00.001-07:00

Fundamental Outlook for Australian Dollar: Bearish

- Westpac Leading Index for January fell 0.2% signaling that the economy may have entered a recession.
- Reserve Bank Of Australian policy meeting minutes showed that further easing may ahead.

The Australian dollar ended higher against most major currencies for a second week in a row as improving risk appetite has pushed commodity prices higher. The local dollar started the week flat against the greenback, but the Fed’s announcement to purchase government bonds sent the AUD/USD higher by over 300 pips. Fundamentally the picture remains cloudy for the high yielder, as the Westpac leading index fell another 0.2 percent—signaling that the economy may have contracted in the first quarter which would confirm that it has entered a recession. Additionally, the RBA’s minutes showed that despite the central bank leaving interest rates on hold, they still see downside risks to the economy and potential for further easing. Policy makers chose to pause in order to be able to gauge the impact of their prior easing which saw them lower their target rate by 4.0 percent to 3.25 percent—a 45 year low.

The printing of money by major central banks has raised concerns of re-inflation which has pushed commodities higher as traders look to hedge their exposure. The CRB index jumped from 209.98 to over 226.0 which was the largest weekly gain in two months. The action by the governments has also feed risk appetite which has made the high yielding currency attractive to investors seeking larger returns. The Conference Board Leading Index is the only major release on the schedule and if it declines for a fifth straight month it would add to concerns over the economy and could weigh on the Australian dollar. If bullish momentum continues we could see the ADU/USD look to test the January 7th high of 0.7272 with the psychological level of 0.7000 as possible resistance. - JR

New Zealand Dollar's Rally Needs Favorable Data To Survive

2009-03-24T08:09:00.000-07:00

Fundamental Outlook For New Zealand Dollar: Bearish

- Fourth quarter manufacturing activity unchanged while sales plunge 5.4 percent
- Service sector activity contracts yet again as sales, employment and orders slide
- Credit card spending contracts for the fifth consecutive month on a year-over-year basis

The New Zealand dollar rallied across the board over the past week as fundamental weakness in some of the kiwi’s major counterparts helped leverage a derivative rebound in risk appetite. Fear, however, is still an indelible element to all markets; so strength in risk-sensitive instruments like the New Zealand currency could soon sputter without a real grounding in fundamentals. This means that either the market will need to see risk dissipate and appetite for yield rise; or the kiwi will need to find fuel to sustain its budding bull trend. Looking at data scheduled for release next week and the lingering macro events on tap, this com bloc staple could finally see a significant retracement of its aggressive two week advance.

As has been the case for months, the most influential and lasting driver of kiwi price action going forward will be the broader appetite for risk. Typically, these trends are ill-defined by schedules and have recently followed the intensity of global financial strains matched against policy officials’ ever-growing efforts to stabilize the markets. Over the coming week, the focus on the balance in fear will intensify leading up to the April 2nd G-20 meeting. Policy officials have been constantly putting out fires in their own economies; and the focus will likely be on the Euro Zone and US through the immediate future. The EU recently announced it would extend its credit line to those members in financial stress to 50 billion euros and was working out an individual bailout loan for Romania – helping to dampen fears that the Eastern European states could fall into bankruptcy and take the Euro Zone with it. A curve ball to keep an eye on is Switzerland. With SNB President Roth’s comments that the Swiss franc cannot afford to appreciate any further, protectionism may get in the way of a global rescue effort that could ultimately call an end to the now, 19-month old crisis.

Typically, the New Zealand dollar is merely caught up in the risk winds generated by its larger, industrialized counterparts; but this week we could actually see the country’s fundamentals actually contribute to the currency’s development. Major economic releases are scheduled for release; and topping the list is the 4Q GDP report. This indicator will force the market to take a critical look at the New Zealand dollar as a risk-sensitive currency and high yielder. It has been the rule of thumb for years that the New Zealand currency rallies when the market is seeking out higher returns because the small economy relieves most of its capital inflows through investment channels as market participants take advantage of the nation’s relatively high yields. However, the benchmark has come down quickly (pulling down rates of return on investable assets with it); and RBNZ Governor Bollard hasn’t officially brought an end to his dovish regime yet. Should data confirm economy shrank 1.1 percent over the quarter for its fastest decline since early 1991, it will severely undermine the hope for outsize returns from New Zealand investments. The same can be said of the current account balance through the same period and more timely trade and consumer sentiment readings. With global rates near the same low level across the world, the potential for higher rates of return down the line is largely dependent on growth. Lacking liquidity, reasonable expectations of return and even financial stability; Australia could end up being an appealing alternative to all the flows New Zealand used to earn. -JK