10th August 2010
The latest economic indicators show a slowing in the pace of the recovery in the United States. With Government warnings and the market’s concern, traders are becoming worried that the U.S. economy could face a double dip recession. Anticipating next week’s FOMC meeting, market players, with everybody else for that matter, they are wondering whether the Fed has a package of policies in store.
According to a survey by Markit, confidence about business activity hit the highest level since February this year. A growing majority of them plan to increase spending and employment in the near future with the largest gains seen in the U.S., Europe and Japan. If corporate spending increases, it could provide underlying support for the global recovery.
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6th August 2010
The pound Sterling fell after the central bank’s policy makers kept the interest rates at the low level, despite the concerns that the inflation may accelerate. In spite of recent gains of the pound on the outlook that the budget cuts wouldn’t cripple the Britain’s economy. The outlook became less optimistic after the Bank of England left the benchmark rate at 0.5 percent. International currency strategists believe that the BoE fears deflation and is prepared to take risks with inflation to thwart that threat. That means interest rates stay low for an extended period, and undermines the recent support we’ve seen in sterling.
The division of the policy makers’ opinions on the necessity of the raising interest rates makes hard to predict future moves of the sterling. Some policy makers are already voting for the increase of the rates as they think that the inflation is actually the greater and more real threat. The inflation has exceeded the target of 2 percent so far.
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5th August 2010
All the knowledge and forecasting skills in the world cannot make you a successful foreign exchange trader if you let personal reservations get in the way. Overcoming the fear of risking your own money can be a difficult challenge, but it is a necessary step toward forex currency trading success.
Battling your own emotions at the highest highs and the lowest lows is a key part of an investment strategy. If fear is allowed into the equation, a forex trader might sell a well-performing currency too soon or sit on a downtrend too long. Either way, the results can be devastating to a personal forex portfolio. Instead, relying on fundamental and technical analysis, your own intuition and the knowledge you have of the market can make you successful at fx trading.
Accepting the fear of trading personal funds and using it to your advantage is what makes a strong forex trader. At times, you may need to take a step back from a loss, reassess and then act accordingly. Give yourself sufficient time to study the analysis, prepare for entry and exit strategies and become comfortable with your knowledge. Once your confidence is securely in place, you can attack the currency exchange market with the vigour it warrants. Make decisions that are strategic and then stick to them and within a short time you will develop the confidence in your skills that will help you overcome any fears about fx trading.
Add a Comment | Posted in Currency Trading, Forex Tips, Forex Trading by Forex News
3rd August 2010
The latest analysis from CitiFXPro, Citi’s forex trading platform, suggests that the recent USD weakness has some way to run. Citi point out that the 200 day moving average hasn’t given a false signal since mid-2006, with 4 decisive trending moves during that time. In May 2009 for example, the USD-Index closed below the 200 day moving average and continued lower to a base in November 2009. In January 2010, it closed back above the 200 day moving average 4 days later and continued higher to the peak in June 2010.
Today it closed below the 200 day moving average at 80.72. As with the breaks seen in 2009 and early 2010, Citi say that this break has come with good momentum which in those instances resulted in quite a significant further trending move.
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3rd August 2010
There is a saying: “If you fail to plan, then you plan to fail” some may think that this is nothing but a cliché, but it is none the less still very valid. A good trading plan should start with a general outline, and then broken down to specifics. Good Forex traders have a general trading plan, as well as a journal which they use to list their trades, and the specifics regarding setups. A note should be made for swing trades as well as daily developments.
Some tips and guidelines would be; why are you trading the Forex, and what are your expectations? Look at the risk and decide how much you currently have in disposable income, and aim to gradually grow your equity. Set reasonable goals on your expected returns over a period of time. Remember, if we approach our trading in a haphazard manner, our results will reflect that. A trading plan lays the groundwork for future success.
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30th July 2010
In the ever growing world of Forex trading there are a vast number of false prophets and liars offering the “secret” to success in Forex trading. As long as there have been investment markets there have been people who claim a deep understanding of the market and it’s “signals”. These Forex signals are historically reoccurring patterns that appear in the Forex market. Sometimes these ebook authors and self proclaimed Forex gurus claim to have developed an automated Forex system that operates on these signals, all offering a guaranteed return for a “reasonable” subscription fee. While it’s clear the best returns in the Forex market would come simply through investing, rather than exposing trade secrets, Forex signals do exist and understanding them is necessary to maximize returns and capitalize on natural market volatility.
The most important consideration regarding forex signals is the nature of single currency signals. A shift of a single currency means little in the short term when all trading is done in currency pairs. With this in mind however, history has shown that at times certain currencies share a common fate (typically a basket of select Asian currencies as well as certain European nations being linked). Stirring in one currency can signal change in another, and this should be taken into consideration when planning a long term investment strategy.
While there are many other Forex signals, it is very difficult to accurately predict what it means for the near future. Many of these beliefs are based on past experience and historical data; however, what is truly most important is the future.
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28th July 2010
Today, forex brokers come in a wide array of shapes and sizes and forex currency trading is not limited simply to individuals, but also includes corporations, banks and even governments. Unlike the traditional stock market, the forex is divided into various levels of access, with the highest tier being the inter-bank market, which is where commercial banks and securities dealers do business. Unless you happen to be one of the forex traders associated with the inter-bank market, the bid and ask prices are unavailable, because this information is kept completely secret. The highest level of inter-bank forex currency trades make up roughly 53% of all daily trades.
Below the major banks are the smaller banks, which rank slightly higher than the international corporations. Corporations work in a slightly different fashion given the fact that they have a higher risk and have employees in different countries, so they are actually dealing with various currencies at any given time. Hedge funds fall behind international corporations, with pension funds, insurance companies, institutional investors and mutual funds falling into the latter group, as well as the futures and exchange day traders. The top dogs are the international banks, which can sometimes trade billions of dollars on a given day and while these transactions are generally carried out on behalf of customers, there are inherent risks, as have been seen in recent years, with several of the major German banks falling prey to poor judgment on the part of traders who have received poor forex training.
Add a Comment | Posted in Currency Trading, Forex Tips, Forex Trading by Forex News
27th July 2010
The euro neared a two-month high against the dollar on Tuesday as last week’s bank stress test results showed no causes for concern and demand for riskier assets rose. Although some analysts stated that the stress tests weren’t tough enough, the euro carried on up as the dollar hit a 12-week low against a host of currencies after weak US data encouraged investors to move to riskier assets.
The euro rose to $1.3023 before trimming back to $1.2992 by the end of the session as sterling hit a 5-month high against the struggling US dollar. Strong gross domestic product data from the UK on Friday boosted the sterling as it hit $1.5530 against the greenback.
Elsewhere the Australian dollar held firm at 0.9023 against the dollar, while the New Zealand dollar hit a six month high of $0.7335. The dollar did rise against the yen during the session ending at 87.19 a 0.4 percent increase.
Add a Comment | Posted in Euro, Forex News, US Dollar by Forex News
23rd July 2010
With the growth of the Internet and online investments and trading, more people than ever have become interested in online Forex trading. While many authors, websites and con artists may claim to have a foolproof system for online Forex trading, very rarely are these claims proven or guaranteed in any way. While there is no one set of golden rules to follow when Forex trading, there are a few tips that any investor, whether novice or expert, should follow closely.
First and foremost, knowledge is power in any industry and foreign exchange is no different. In this case, global news and events, both the good and the bad are where volatility will form and where great returns can be had. While some newcomers will react violently to bad news in a global currency market, by doing so they miss some of the best opportunities to purchase and trade currencies at a low price.
In addition, any successful Forex trader should visualise the market and flow of currencies in terms of pairs, rather than individual currencies. Success and failure in the Forex markets depend on both currencies in a trade having a positive impact on one another from the trader’s perspective.
Finally and most importantly, no one trader can fight the market on their own. When the market is travelling upward, the market is travelling upward and vice versa. There is a wealth of data that analyses past trends, but none of this can predict the future. The best indication of the future is the velocity of a currency in the here and now.
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22nd July 2010
The dollar fell to just above a 7-month low against the yen today after the Federal Reserve chairman Ben Bernanke stated that the US economic outlook remained “unusually uncertain”. This sparked a sell-off in riskier assets as investors took solace with the yen.
The dollar fell by 0.6% against the yen ending at 86.56 after also losing 0.5% on Wednesday. The euro also fell against the yen as investors look towards European bank stress test results to be released on Friday.
The euro fell by 0.3% against the yen, hitting a two week low at 110.03, but rose 0.3% against the dollar ending at $1.2773.
Add a Comment | Posted in Euro, Forex News, US Dollar, Yen by Forex News