When the going gets tough, the tough get going. This adage often brings back the memories of my past days when I was trading initially in the currency exchange market. Indeed, there's nothing more hurtful than losing your invested money in the FX market. But, online currency trading is like life where you're got to learn from your wrong moves and keep moving on. Learning the basic skills of online forex trading could be easy but, practically, one needs to acquire the advanced skills to play safe through thick and thin of FX trading.
I have traded in forex for many years and, if you count on me, I must tell you that the secret of successful trading lies largely on the hunch and intuition of an trader. Technically expressed, you should have the accurate forex alerts and forex signals to be able to make the right moves in the currency market. However, this is easier said than done as the skills of the Currency Trading Signal takes a long time to master. This is why while a few people are able to boost their forex pips in a short span of time, the others take a long time to achieve the same or maybe, some of them get frustrated and just give it up! The reality is that not many people are ready to be entirely devoted to the perilous process of online forex trading.
Having said this, I still wonder why some people choose to be a dare-devil and risk their money instead of simply following an established and renowned Account Forex Online Trading. I began trading in 1997 and there is one important thing I have learnt in my trading career so far, i.e., you have to got to be patient to learn the tricks of making right moves at the right times and profit from your trading.
Since I have led quite a successful career in forex trading, I have been sharing the tips and tricks of online currency trading with many traders around the world through my G7 Forex Trading System which as you know has remained pretty successful for many traders so far. My G7 Forex Trading System is an easy-to-follow, step-by-step trading manual offering in-depth online forex trading review.
If you visit my site (www.forex-science.com) you will find many of my existing customers are pretty satisfied with the performance of their investments and in fact, most of them have been able to increase their forex pips drastically. You would be surprised to know quite a few of them haven't traded for a long time! Now, this is what we call success in the forex trading, eh?
About the Author
James was born in London, UK in 1966. He completed undergraduate studies in Mathematics and Biochemistry at the University of Port Elizabeth. James began trading the Forex markets in 1997. James has since gained enormous experience in forex trading alert software .
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Monday, September 28, 2009
Foreign exchange market
The foreign exchange market (Currency, Forex, or FX) market is where currency trading takes place. It is where banks and other official institutions facilitate the buying and selling of foreign currencies. FX transactions typically involve one party purchasing a quantity of one currency in exchange for paying a quantity of another. The foreign exchange market that we see today started evolving during the 1970s when worldover countries gradually switched to floating exchange rate from their erstwhile exchange rate regime, which remained fixed as per the Bretton Woods system till 1971.
Today, the FX market is one of the largest and most liquid financial markets in the world, and includes trading between large banks, central banks, currency speculators, corporations, governments, and other institutions. The average daily volume in the global foreign exchange and related markets is continuously growing. Traditional daily turnover was reported to be over US$3.2 trillion in April 2007 by the Bank for International Settlements. Since then, the market has continued to grow. According to Euromoney's annual FX Poll, volumes grew a further 41% between 2007 and 2008.
The purpose of FX market is to facilitate trade and investment. The need for a foreign exchange market arises because of the presence of multifarious international currencies such as US Dollar, Pound Sterling, etc., and the need for trading in such currencies.
Today, the FX market is one of the largest and most liquid financial markets in the world, and includes trading between large banks, central banks, currency speculators, corporations, governments, and other institutions. The average daily volume in the global foreign exchange and related markets is continuously growing. Traditional daily turnover was reported to be over US$3.2 trillion in April 2007 by the Bank for International Settlements. Since then, the market has continued to grow. According to Euromoney's annual FX Poll, volumes grew a further 41% between 2007 and 2008.
The purpose of FX market is to facilitate trade and investment. The need for a foreign exchange market arises because of the presence of multifarious international currencies such as US Dollar, Pound Sterling, etc., and the need for trading in such currencies.
London Session
Sterling, the AUD and the NZD have all made huge gain vs the USD this morning; the EUR has also seen a sizeable rally. The weakness of the USD can be linked to the US treasury market and fears over the ballooning size of the US budget deficit.
The rise in long term US interest rates and weaker USD are consistent with the view that the market has reduced its ‘safe-haven’ long positions which were built during the height of the financial crisis. Even though it is possible that there could be further bad news ahead, demand for safe haven assets is presently out of favour. For now focus is on how the US will reduce its deficit and fund its debt going forward, and crucially who will buy the debt. Treasury Secretary is visiting China. He reassured his hosts overnight that he wants to shrink the budget deficit to around 3% of GDP. These reassurances are necessary given the huge proportion of US debt that is owned by the Chinese and other overseas investors. However, it will be a huge effort for the US government to reduce its budget deficit. In the meantime it seem reasonable that overseas investors will demand higher yields to compensate them for holding Treasuries given the increased risk associated with higher supply and given the longer-term inflationary threat implied by QE. The Fed, however, are trying to keep long-term interest rates down through QE to re-inflate the economy. There is a risk therefore that QE could put overseas buyers off. However, if the Fed does not announce more QE there may be risk that the economic recovery could falter. US policy makers will have to tread carefully in the months ahead with respect to the amounts of QE. In the meantime, the market is playing safe by selling the dollar.
The weakness of the USD is feeding the rally in commodities and giving significant support to gold. The AUD and the NZD have surged, and further upside to ‘risky’ currencies is likely if the Fed does increase its QE plan. Sterling is also benefitting from the rally in risk, with cable bursting through the USD1.6250 area in early London trading before meeting some resistance ahead of USD1.6400. News overnight from the UK Hometrack survey showing house stable prices in May also helped sterling as did the better than expected manufacturing PMI data which rose to 45.4 in May from an upwardly revised 43.1 in April. EUR/GBP has pushed down towards the EUR/GBP0. 8670 level before running into support. PMI data from Italy and Spain and final PMIs from Germany and France all showed improvement lending support to the EUR’s rally vs the USD. EUR/USD surged higher in early European hours but ran into sellers at EUR/USD1.4240
This afternoon, US personal spending and ISM data is due. Canadian Q1 GDP will be released.
The rise in long term US interest rates and weaker USD are consistent with the view that the market has reduced its ‘safe-haven’ long positions which were built during the height of the financial crisis. Even though it is possible that there could be further bad news ahead, demand for safe haven assets is presently out of favour. For now focus is on how the US will reduce its deficit and fund its debt going forward, and crucially who will buy the debt. Treasury Secretary is visiting China. He reassured his hosts overnight that he wants to shrink the budget deficit to around 3% of GDP. These reassurances are necessary given the huge proportion of US debt that is owned by the Chinese and other overseas investors. However, it will be a huge effort for the US government to reduce its budget deficit. In the meantime it seem reasonable that overseas investors will demand higher yields to compensate them for holding Treasuries given the increased risk associated with higher supply and given the longer-term inflationary threat implied by QE. The Fed, however, are trying to keep long-term interest rates down through QE to re-inflate the economy. There is a risk therefore that QE could put overseas buyers off. However, if the Fed does not announce more QE there may be risk that the economic recovery could falter. US policy makers will have to tread carefully in the months ahead with respect to the amounts of QE. In the meantime, the market is playing safe by selling the dollar.
The weakness of the USD is feeding the rally in commodities and giving significant support to gold. The AUD and the NZD have surged, and further upside to ‘risky’ currencies is likely if the Fed does increase its QE plan. Sterling is also benefitting from the rally in risk, with cable bursting through the USD1.6250 area in early London trading before meeting some resistance ahead of USD1.6400. News overnight from the UK Hometrack survey showing house stable prices in May also helped sterling as did the better than expected manufacturing PMI data which rose to 45.4 in May from an upwardly revised 43.1 in April. EUR/GBP has pushed down towards the EUR/GBP0. 8670 level before running into support. PMI data from Italy and Spain and final PMIs from Germany and France all showed improvement lending support to the EUR’s rally vs the USD. EUR/USD surged higher in early European hours but ran into sellers at EUR/USD1.4240
This afternoon, US personal spending and ISM data is due. Canadian Q1 GDP will be released.
New York Session
The NY session saw a perfect storm develop against the US dollar as risk taking and lower US yields weighed on the buck. Better earnings in the retail space helped buoy shares and the S&P climbed comfortably back above the 900 mark, adding a nice 2.1% on the day. Commodities were better bid and the CRB index rallied more than 1.4%. Oil was a main driver of the gains as crude jumped nearly $2 to back above the $70/bbl mark. Gold, for its part, added $8 on the day towards 939/940 as the precious metal continues to get bought ahead of 900 support.
If this wasn’t enough, yields in the US also pushed lower on the back of another excellent Treasury auction. The 7-year saw a 2.82 bid/cover with more than 67% of the offer going to indirect bidders (foreign central banks). The results were well above recent trends and suggest US funding concerns are way overdone at this point. Bonds were bought hand-over-fist and the 10-year yield dropped -15 basis points to 3.54%. This impacts the US rate differential (making US assets relatively less attractive from a rate of return standpoint) and could weigh on the dollar if sustained.
EUR/USD was ultimately higher on the back of the dollar-negative developments and the pair popped from a session low 1.3989 to a high of roughly 1.4010/15. The air above 1.40 remains thin and we would expect good resistance into that area. GBP/USD recovered from a collapse into 1.6235 to sit near 1.6370 at the NY close.
The only economic data of note was US initial jobless claims and they jumped to a higher than anticipated 627K from 612K the prior week. This was the biggest change in claims in about one month and puts a damper on expectations for a speedy job market recovery.
Upcoming Economic Data Releases (Asia Session) prior expected
6/25 22:45
GMT
NZ
GDP
QoQ 1Q
-0.90% -0.70%
6/25
23:01
GMT
UK Bank of England Releases
Financial Stability Report
25-Jun
6/25 23:30
GMT
JN
Tokyo CPI YoY
JUN
-0.80% -1.30%
6/25 23:30
GMT
JN
Tokyo CPI Ex-Fresh Food YoY
JUN
-0.70% -1.00%
6/25
23:50
GMT
JN
All Industry Activity Index (MoM)
APR
-2.40% 2.30%
If this wasn’t enough, yields in the US also pushed lower on the back of another excellent Treasury auction. The 7-year saw a 2.82 bid/cover with more than 67% of the offer going to indirect bidders (foreign central banks). The results were well above recent trends and suggest US funding concerns are way overdone at this point. Bonds were bought hand-over-fist and the 10-year yield dropped -15 basis points to 3.54%. This impacts the US rate differential (making US assets relatively less attractive from a rate of return standpoint) and could weigh on the dollar if sustained.
EUR/USD was ultimately higher on the back of the dollar-negative developments and the pair popped from a session low 1.3989 to a high of roughly 1.4010/15. The air above 1.40 remains thin and we would expect good resistance into that area. GBP/USD recovered from a collapse into 1.6235 to sit near 1.6370 at the NY close.
The only economic data of note was US initial jobless claims and they jumped to a higher than anticipated 627K from 612K the prior week. This was the biggest change in claims in about one month and puts a damper on expectations for a speedy job market recovery.
Upcoming Economic Data Releases (Asia Session) prior expected
6/25 22:45
GMT
NZ
GDP
QoQ 1Q
-0.90% -0.70%
6/25
23:01
GMT
UK Bank of England Releases
Financial Stability Report
25-Jun
6/25 23:30
GMT
JN
Tokyo CPI YoY
JUN
-0.80% -1.30%
6/25 23:30
GMT
JN
Tokyo CPI Ex-Fresh Food YoY
JUN
-0.70% -1.00%
6/25
23:50
GMT
JN
All Industry Activity Index (MoM)
APR
-2.40% 2.30%
Asia Session
The choke hold that has been on the US Dollar as of late was temporality loosened prior to the open in Asia after the Greenback spent its time in New York recording some new lows for 2009. The action was choppy in NY with a high near 1.4297, EUR/USD fell closer to the 1.4140 level and began the day in Asia near 1.4160 and as well, exited the session near the same 1.4160 level, with about 50 pips of moves in between. Most pairs were relatively stable in Asian trading, ending the day close to where they began, with minor moves in between. GBP/USD began the session near 1.64400 and after moves in a less than 60 pip range looked to enter the London stage at the same opening levels. The Yen made small gains in Asia after aggressive selling in NY was used to help fund the reemerging carry trade. USD/JPY playing in a 65 pip range lost 20 pips on the day to close out near 96.40. EUR/JPY dropped about 20 pips for the day to end out near 136.45 after a late day surge in NY pushed the pair over 137.00 for the first time since early April. The 112.00 levels we witnessed early in the year seem far removed indeed. Overall, the climate in the currency markets is dominated currently by data, more precisely, the remaining central bank rate decisions that are on the docket for the week. With the RBA leaving rates unchanged today as expected at 3.0%, we still have Canadian, Euro Zone and British rates on the path ahead, and as could be expected, traders are tentative with these type of announcements on the table.
Upcoming Economic Data Releases (London Session) prior expected
6/2/2009
5:45
SZ
GDP (QoQ)
1Q
-0.30%
-1.50%
6/2/2009
5:45
SZ
GDP (YoY)
1Q
-0.60%
-1.70%
6/2/2009
6:45
FR
Producer Prices (MoM)
APR
-0.40%
-0.20%
6/2/2009
6:45
FR
Producer Prices (YoY)
APR
-5.50%
-6.40%
6/2/2009
7:30
SZ
SVME-Purchasing Managers Index
MAY
34.7
36.5
6/2/2009
8:30
UK
Net Consumer Credit
APR
0.1B
0.1B
6/2/2009
8:30
UK
Net Lending Sec. on Dwellings
APR
0.8B
1.0B
6/2/2009
8:30
UK
Mortgage Approvals
APR
39K
41K
6/2/2009
8:30
UK
M4 Money Supply (MoM)
APR F
0.10%
- -
6/2/2009
8:30
UK
M4 Money Supply (YoY)
APR F
17.40%
- -
6/2/2009
8:30
UK
PMI Construction
MAY
38.1
39.5
6/2/2009
9:00
EC
Euro-Zone Unemployment Rate
APR
8.90%
9.10%
Upcoming Economic Data Releases (London Session) prior expected
6/2/2009
5:45
SZ
GDP (QoQ)
1Q
-0.30%
-1.50%
6/2/2009
5:45
SZ
GDP (YoY)
1Q
-0.60%
-1.70%
6/2/2009
6:45
FR
Producer Prices (MoM)
APR
-0.40%
-0.20%
6/2/2009
6:45
FR
Producer Prices (YoY)
APR
-5.50%
-6.40%
6/2/2009
7:30
SZ
SVME-Purchasing Managers Index
MAY
34.7
36.5
6/2/2009
8:30
UK
Net Consumer Credit
APR
0.1B
0.1B
6/2/2009
8:30
UK
Net Lending Sec. on Dwellings
APR
0.8B
1.0B
6/2/2009
8:30
UK
Mortgage Approvals
APR
39K
41K
6/2/2009
8:30
UK
M4 Money Supply (MoM)
APR F
0.10%
- -
6/2/2009
8:30
UK
M4 Money Supply (YoY)
APR F
17.40%
- -
6/2/2009
8:30
UK
PMI Construction
MAY
38.1
39.5
6/2/2009
9:00
EC
Euro-Zone Unemployment Rate
APR
8.90%
9.10%
Asia Session 2
Today’s market open looked promising for the US Dollar, with the Greenback making gains right out of the gate, however the move was short lived as it slipped right back to multi-month lows as traders looked to profit from higher yielding currencies. EUR/USD opened near 1.4140 and initially slipped below 1.4100 before punching back to session highs near 1.4166, just short of Friday’s six month high of 1.4170. The pattern was similar in GBP/USD as the pair slipped on the open and eventually made an almost seven month high of 1.62440, and this was repeated with the AUD/USD and NZD/USD as well. It would seem that the selling of the Dollar and the purchase of risk continues as investors are emboldened with more signs that the worst of the economic crisis is over. USD/JPY dropped lower to 94.66 after hitting initial highs of 95.45 as the Yen buying continued across the board, pushing all the yen based crosses lower. As the session creeps into London, it would seem that the yen crosses are almost complete in paring their losses. Good PMI data out of China help push the commodity currencies higher, as AUD/USD and NZD/USD continued their dynamic moves higher. This week will begin with market moving data and end with it as well, as we start the week in a precarious fashion in NY tomorrow with the supposed bankruptcy of General Motors, and from there we will see rate decisions from Australia, Canada and Great Britain, and finish the week with the US Employment data…..It should be quite a week.Upcoming Economic Data Releases (London Session) prior expected
6/1/2009
7:50
FR
PMI Manufacturing
MAY F
43.1
43.1
6/1/2009
7:55
GE
PMI Manufacturing
MAY F
39.1
39.1
6/1/2009
8:00
EC
PMI Manufacturing
MAY F
40.5
40.5
6/1/2009
8:30
UK
PMI Manufacturing
MAY
42.9
44
01-02 JUN
JUN
US
Geithner to Give Speech, Hold Talks With Officials in Beijing
2-Jun
Asia Session 3
The end of the trade week in Asia saw the US Dollar extend losses across the board as traders continued to seek out riskier higher yielding assets on the back of the Federal Reserve seeming to continue on course with low rates. Stocks were higher in the US and that momentum carried over to Asia as stocks looked to post gains for a third straight day. With the dollar being dumped once again, the buck was helped in posting its biggest weekly loss in a month against the single European currency. EUR/USD surged higher today, taking off from 1.3983 and not stopping until it breeched the 1.4060 level. With commodity prices higher, the so called commodity currencies made some ample gains. AUD/USD made a 50 pip move higher to post a high just over 0.8070 and the Canadian Dollar strengthened as well, pulling the USD/CAD pair from 1.1560 to just over the 1.1500 figure. In New Zealand, the picture was not as bright as GDP was released showing a -1.1% decline as opposed to the -0.7% expected. The reaction was swift, as NZD/USD collapsed from 0.6468 to just over 0.6005 in mere minutes. AUD/NZD popped on the data, shooting from near 1.2400 to highs over 1.2535.
Although USD/JPY stayed in a 40 or so pip range between 96.04 and 95.62 with no net move on the session, the EUR/JPY and AUD/JPY pairs both made moves higher, by about 70 and 50 pips respectfully. NZD/JPY suffered the same fate as the other Kiwi anchored pairs, dropping an easy 60 pips in one quick swoop. Traders abandoned the Kiwi Dollar today as they feared that this fifth consecutive negative quarter would force the hand of the RBNZ to lower rates once again.
Have a nice weekend…
Upcoming Economic Data Releases (London Session) prior expected
6/26/2009
6:00
GE
Import Price Index (MoM)
MAY
-0.80%
0.30%
6/26/2009
6:00
GE
Import Price Index (YoY)
MAY
-8.60%
-10.30%
6/26/2009
6:50
FR
Consumer Confidence Indicator
JUN
-40
-39
6/26/2009
9:30
SZ
KOF Swiss Leading Indicator
JUN
-1.86
-1.75
Although USD/JPY stayed in a 40 or so pip range between 96.04 and 95.62 with no net move on the session, the EUR/JPY and AUD/JPY pairs both made moves higher, by about 70 and 50 pips respectfully. NZD/JPY suffered the same fate as the other Kiwi anchored pairs, dropping an easy 60 pips in one quick swoop. Traders abandoned the Kiwi Dollar today as they feared that this fifth consecutive negative quarter would force the hand of the RBNZ to lower rates once again.
Have a nice weekend…
Upcoming Economic Data Releases (London Session) prior expected
6/26/2009
6:00
GE
Import Price Index (MoM)
MAY
-0.80%
0.30%
6/26/2009
6:00
GE
Import Price Index (YoY)
MAY
-8.60%
-10.30%
6/26/2009
6:50
FR
Consumer Confidence Indicator
JUN
-40
-39
6/26/2009
9:30
SZ
KOF Swiss Leading Indicator
JUN
-1.86
-1.75
Turkey Gold Market
Turkey has been an important regional gold market for many years; during the 1990s domestic jewellery fabrication averaged 125 tonnes (4.02 million oz). In addition, Turkey has been a key source of bullion for several neighbours countries. Turkish bullion imports, which normally exceed 100 tonnes (3.2 million oz) on an annual basis, came to 107 tonnes in 1999 but then rose significantly in 2000 to 205 tonnes (6.6 million oz). However, the following year bullion imports fell sharply. According to GFMS, this was partly due to the sharp devaluation of the Turkish currency and the associated economic and banking crises which affected the country. On a separate note, Turkey's position in the international market was enhanced by the full liberalisation of the local gold market in 1998 and the opening of the Istanbul Gold Exchange on 26 July 1995.
japan Gold Market
Japan has evolved as a major market for gold for fabrication and investment since trading was liberalised in 1974. But the gold business in Japan has much earlier origins. Gold mines in Japan in the 17th century exported through the Dutch East India Company to East Asian countries. Tokuriki Honten, still an important refiner and fabricator, traces its history back to 1727. Tanaka Kikinzoku Kogyo, the leading precious metal refiner and trader, was established in 1885.
Actual mine production is limited. The only significant mine is Sumitomo Metal Mining's Hishikari on Kyushu island, opened in 1985, with output between seven and eight tonnes (0.25-0.26 million oz) annually. The Japanese market is supplied, therefore, both by imports of bullion and by-product gold from imported concentrates.
Total gold demand in Japan ranges between 200 and 275 tonnes (6.4 – 8.8 million oz), embracing jewellery fabrication, electronic and industrial uses, dental applications and physical bar investment . Japan is the world's foremost user in electronics, using over 100 tonnes (3.21 million oz) in 2000 according to GFMS (although this fell sharply, to around 70 tonnes or 2.25 million oz, in 2001 on the back of the slowdown in global demand). Japan's use of dental gold in 2001 was around 21 tonnes (675,000 oz) according to GFMS. Physical bar hoarding is also much higher than in other industrial countries, and is an anonymous way of holding wealth outside of the banking sector. GFMS estimate that it averaged just under 60 tonnes (1.9 million oz) over the past decade and exceeding 100 tonnes (13.2 million oz) in 1999. The first few months of 2002 saw a surge in Japanese hoarding demand due to fears about the health of the banking system.
It is also the custom in Japan for companies to give gifts of 24 carat ornaments such as teapots, saki cups, vases and chopsticks. The gold tea ceremony room at the Moa Art Museum in Shizuoka Province used 50 kilos (1,607 oz) for teapots and cups, plus gold leaf for its walls.
Forex Successful Currency Trading
Foreign Exchange - Forex, FX - market is one of the biggest markets today. Daily turnover has skyrocketed from approximately 5 billion USD in 1977, to a staggering 3 trillion (and more) US dollars today. This is more than 40 times the daily turnover of the NASDAQ.
Forex currency trading is attractive to traders as currency markets are cnstantly fluctuating and there is potential to profit whether a currency is going up or down. Traders trade on margin which leverages their potential gains. What also makes it so popular is that there is no centralized location for trading as there is in futures or stocks, as trading occurs around the clock over the telephone and on computer terminals at thousands of locations worldwide.
Currency trading occurs when one country's currency is traded for another country's currency at the prevailing exchange rate. All currency is traded in LOTS. Each lot has a different amount of currency. Currency trading is carried out on a point (or pip) system. Traders are trying to capture points. Depending on the currency, each point is worth a different amount. For example, if the Brittish Pound is worth about $10 per point that is traded per lot and you trade 1 lot and capture 40 points, you make $400.
Forex currency trading does involve substantial amount of risk. About 10% of people make money and 90% lose money on currency trading! Why? Because many of those who enter the currency trading market are dirven by emotions and know very little about the techniques of currency trading. Having some forex currency trading education, being in the optimal state of mind, and having the right tools can help you to join the ranks of those 10% of people who do make money in forex currency trading.
Currency trading professionals seek price fluctuations and investors seek return on investment. Both take a calculated risk that is minimized by knowledge, optimal mind set, and the right tools. Currency trading turns into gambling when you are uneducated, trade emotionally or with a "hot tip".
Successful Forex Trading set of CDs is designed to help you become a successful Forex trader by programming your subconscious mind to help you choose the best currencies to trade, when to enter, when to exit the trade, develop your intuition and open yourself to financial abundance. Financial wizards will tell you that 80% of financial wizardry is in your mindset and the other 20% is in techniques and mechanics.
Successful Forex Trading CDs help you to get into the optimal mindset for successful Forex trading. Beside having the optimal mindset, you could also tremendously benefit from having the right tools - like Real Money Doubling Forex Robot - click here to watch the videos that show you the results you can achieve.
Forex currency trading is attractive to traders as currency markets are cnstantly fluctuating and there is potential to profit whether a currency is going up or down. Traders trade on margin which leverages their potential gains. What also makes it so popular is that there is no centralized location for trading as there is in futures or stocks, as trading occurs around the clock over the telephone and on computer terminals at thousands of locations worldwide.
Currency trading occurs when one country's currency is traded for another country's currency at the prevailing exchange rate. All currency is traded in LOTS. Each lot has a different amount of currency. Currency trading is carried out on a point (or pip) system. Traders are trying to capture points. Depending on the currency, each point is worth a different amount. For example, if the Brittish Pound is worth about $10 per point that is traded per lot and you trade 1 lot and capture 40 points, you make $400.
Forex currency trading does involve substantial amount of risk. About 10% of people make money and 90% lose money on currency trading! Why? Because many of those who enter the currency trading market are dirven by emotions and know very little about the techniques of currency trading. Having some forex currency trading education, being in the optimal state of mind, and having the right tools can help you to join the ranks of those 10% of people who do make money in forex currency trading.
Currency trading professionals seek price fluctuations and investors seek return on investment. Both take a calculated risk that is minimized by knowledge, optimal mind set, and the right tools. Currency trading turns into gambling when you are uneducated, trade emotionally or with a "hot tip".
Successful Forex Trading set of CDs is designed to help you become a successful Forex trader by programming your subconscious mind to help you choose the best currencies to trade, when to enter, when to exit the trade, develop your intuition and open yourself to financial abundance. Financial wizards will tell you that 80% of financial wizardry is in your mindset and the other 20% is in techniques and mechanics.
Successful Forex Trading CDs help you to get into the optimal mindset for successful Forex trading. Beside having the optimal mindset, you could also tremendously benefit from having the right tools - like Real Money Doubling Forex Robot - click here to watch the videos that show you the results you can achieve.
Forex Trading
In recent years, there are many people are involved in forex trading. Do you know what forex trading is ? Have you ever saw trading on the stock market? OK, Forex trading is just quite similar with that and in this field we make a deals with trading currencies amongst different countries which is usually done with a financial institution or a broker.
At this moment, we can say that Forex becomes the largest market on the planet and it is always changing, worldwide, 24×7. All these aspect is one of the things that makes forex so exciting. With that kind of activity, it is not always accurately predictable, but you need to understand the market so that you can jump on profitable trades and minimize your losses in losing trades, which is all based on the strategy that you utilize.
However, before you start to trade, one important things that you need to know and understand forex trading is a gamble, and like the advice offered to those who want to enter this field, never play with money you cannot afford to lose. Keep in mind There are no guarantees in the forex market, which means that you need to utilize all the tools at your disposal to ensure you have considered all factors that will impact a currency’s value, both now and in the future.
They are a key player when it comes to forex markets and trading. The central banks are located in New York, Tokyo and London. In fact, these are the areas where the concentration of central banks are the largest. If financial institutions suffer a loss in the forex market, the investors will also feel the loss.
If you really want to get serious please take the time to learn the forex market, since the financial rewards are huge, but make sure you also protect yourself by allowing for a potential loss.
At this moment, we can say that Forex becomes the largest market on the planet and it is always changing, worldwide, 24×7. All these aspect is one of the things that makes forex so exciting. With that kind of activity, it is not always accurately predictable, but you need to understand the market so that you can jump on profitable trades and minimize your losses in losing trades, which is all based on the strategy that you utilize.
However, before you start to trade, one important things that you need to know and understand forex trading is a gamble, and like the advice offered to those who want to enter this field, never play with money you cannot afford to lose. Keep in mind There are no guarantees in the forex market, which means that you need to utilize all the tools at your disposal to ensure you have considered all factors that will impact a currency’s value, both now and in the future.
They are a key player when it comes to forex markets and trading. The central banks are located in New York, Tokyo and London. In fact, these are the areas where the concentration of central banks are the largest. If financial institutions suffer a loss in the forex market, the investors will also feel the loss.
If you really want to get serious please take the time to learn the forex market, since the financial rewards are huge, but make sure you also protect yourself by allowing for a potential loss.
Forex Market
Forex Market Hours
One of the main reasons why the forex market is so popular is because it is a 24 hour continuous market. Although the sessions on each of the separate exchanges generally open from 10AM to 6PM local time, they overlap each other like a relay race. Therefore, you can trade at any time and you can set your own hours. This is great for those who are not interested in a typical 9 to 5 job or for those who want to start trading on a part time basis.
Equal Opportunity Trading
The forex market is considered part of the Over The Counter, or OTC market, which means it doesn’t have a physical or central location. The forex market is run electronically within a network of banks and is made up of all participants that trade between themselves. The sheer size of the forex market makes it impossible for large investment or central banks to manipulate pricing for extended periods of time. This levels the playing field for all the average joe traders out there.
What it Means for You
Since there isn’t a centralized location and because there is little regulation of the forex market, there is heavy competition between different providers to attract the most traders and volume. It also means that the firm you trade with is your counterpart. The advantages are that you can trade directly with the market and that your transaction costs are kept down. The ability to make large profit off leverage is another advantage to the stock exchange. With some firms, you can trade or borrow up to 200 times the balance in your account. This means that a .5% move in the market can turn into a 100% gain.
The forex market is also popular because it doesn’t cost much to start trading. You have to be in it to win it, as some lotto slogans say. There are some online forex brokers that require as little as $10.00 to deposit in a trading account to get started. In the beginning, only large institutions could trade on the forex market; however the internet has made it possible for smaller investors to trade as well. Due to the popularity of online forex trading, the competition between online forex brokers is fierce. As a direct result, the minimum deposits to trade have now become very low.
One of the main reasons why the forex market is so popular is because it is a 24 hour continuous market. Although the sessions on each of the separate exchanges generally open from 10AM to 6PM local time, they overlap each other like a relay race. Therefore, you can trade at any time and you can set your own hours. This is great for those who are not interested in a typical 9 to 5 job or for those who want to start trading on a part time basis.
Equal Opportunity Trading
The forex market is considered part of the Over The Counter, or OTC market, which means it doesn’t have a physical or central location. The forex market is run electronically within a network of banks and is made up of all participants that trade between themselves. The sheer size of the forex market makes it impossible for large investment or central banks to manipulate pricing for extended periods of time. This levels the playing field for all the average joe traders out there.
What it Means for You
Since there isn’t a centralized location and because there is little regulation of the forex market, there is heavy competition between different providers to attract the most traders and volume. It also means that the firm you trade with is your counterpart. The advantages are that you can trade directly with the market and that your transaction costs are kept down. The ability to make large profit off leverage is another advantage to the stock exchange. With some firms, you can trade or borrow up to 200 times the balance in your account. This means that a .5% move in the market can turn into a 100% gain.
The forex market is also popular because it doesn’t cost much to start trading. You have to be in it to win it, as some lotto slogans say. There are some online forex brokers that require as little as $10.00 to deposit in a trading account to get started. In the beginning, only large institutions could trade on the forex market; however the internet has made it possible for smaller investors to trade as well. Due to the popularity of online forex trading, the competition between online forex brokers is fierce. As a direct result, the minimum deposits to trade have now become very low.
Who are the Players in the Forex Markets?
The foreign exchange market or the Forex market. These exchanges of currencies are facilitated by brokers or a financial institution in the timeliest manner. Today, Forex trading is no longer strange to the masses and many individuals are already engaged in this business, which really does not come very far from the stock market. The difference between the two, however, is that Forex is comparatively larger in scale than the Forex market. Practically all kinds of individuals and institutions are engaged in Forex such as the banks, governments, businesses, brokers, and even individual traders who are often called speculators. The state of the financial market and the economy is what determines the state of the currency of a particular country. A very large sum of money is changing hands in the Forex market; an amount reaching to trillions of dollars everyday.According to the records, the largest sum of money that change hands over these past years happened between banks, something called an interbank transaction. In fact, 50 percent of the Forex transactions are facilitated by the banks. This goes to show that banks use Forex to earn money from the deposits made by the people and the businesses to them. Part of these earnings goes to the interest these banks pay to their depositors. In fact, Forex trading is one of the best income earners of many banks around the world. Some banks allow their deposits to be traded on Forex and ready them the next morning for withdrawals by their depositors.Big companies also trade their cash reserves in Forex to gain income. Example of this blue chip companies and financial institutions that trade Forex are Deutsche Bank, UBS, Citigroup, HSBC, Barclays, Merrill Lynch, JP Morgan Chase, Goldman Sachs, ABN Amro, Morgan Stanley, and many others. Forex trading is part of their strategy to increase wealth of their stock holders. Smaller companies also participates in Forex although not as broadly as the big companies for obvious reasons.A country’s Central Bank plays a very important role when it comes to taking care of the Forex market and the Forex rate for its nation. In fact, the Central Bank is what determines the amount of money to be put in circulation and to some extent; it could affect the interest rate if needed – although other countries would cry foul if intervention is done. A large volume of trading usually happens in premiere markets such as in Tokyo, New York, and London. Of course, smaller markets around the world are also doing trading but not as large scale as these markets being mentioned. What ever the result of trading by these large companies and corporations in Forex, a portion of it is passed on to their investors – that is to say loss or gain.
How To Practice In Forex Market?
If you have the impulse to learn more about foreign marketplaces and international trading mechanisms, be mindful that you are gambling a lot if you get into these marketplaces without any experience. The World Wide Web Wide Web] enables the opportunity to run tests and computer simulations while learning the techniques in which forex dealing is carried out. The international marketplaces are inclusive of many nations where foreign monies are pitted against each other and are worth more or less than the original valued currencies that are being traded. The forex marketplaces are employed to build the financial wealth of nations, banks and brokers, and for many nations.
To learn what you need to know about the forex market, you’ll need to find some forex test application or learning program you can make use of. When you start the testing you will input information about what you are interested in and you can then install the program on your system. By monitoring your progress you will learn about your methods in the forex market. This playing around will make you more considerate of what happens daily, how the markets open and close, and how different the various countries currencies really are.
Shortly after you start your account, you’ll be able to determine where you’ll be able to read the news, find and compare markets, and make ‘fake’ trades so you can watch your money build or be eaten away in losses. As you develop a skill for using the system, you will become more and more prepared, learned and you will be able to kick off some major trades. You will want to remain dedicated to a forex broker in order to ensure your trades go through, but you will have confidence regarding the market and what calls you may want to make when you read about the news, the markets, and the currencies in other countries.
To learn what you need to know about the forex market, you’ll need to find some forex test application or learning program you can make use of. When you start the testing you will input information about what you are interested in and you can then install the program on your system. By monitoring your progress you will learn about your methods in the forex market. This playing around will make you more considerate of what happens daily, how the markets open and close, and how different the various countries currencies really are.
Shortly after you start your account, you’ll be able to determine where you’ll be able to read the news, find and compare markets, and make ‘fake’ trades so you can watch your money build or be eaten away in losses. As you develop a skill for using the system, you will become more and more prepared, learned and you will be able to kick off some major trades. You will want to remain dedicated to a forex broker in order to ensure your trades go through, but you will have confidence regarding the market and what calls you may want to make when you read about the news, the markets, and the currencies in other countries.
Thinking of trying your Luck in the Forex Market
The Foreign Exchange market, also referred to as the "FOREX" or "Forex" or "Retail forex" or “FX” or "Spot FX" or just "Spot" is the largest financial market in the world, with a volume of over $2 trillion a day. Compare that to the $25 billion a day volume that the New York Stock Exchange trades. Making money in such a market should be easy, right? Not necessarily. But it can be done. And with the advent of the internet, its now more easier than ever for the average person to get involved in speculative forex trading. In the past, forex trades had to be carried out through a broker and the initial requirement was that you could trade only if you had about ten to fifty million dollars to start with! Today, carrying out a trade can be done by anyone from the comfort of your home or in front of any pc with internet access using an online trading account.
The fact that there is so much risk and yet so much potential involved with forex trading is what draws most people to it, sort of like gambling. Its all about the adrenaline rush. And making money, of course.
There are many benefits and advantages to trading forex such as no commissions, no middlemen, no fixed lot size, low transaction costs, a 24 hour market, no one can corner the market, leverage, high liquidity, free “demo” accounts, news, charts, and analysis and “mini” and “micro” Trading
However, the speed and complexity of market movements can be a deterrent to aspiring investors. Unless you have a trading system you follow and a good grasp of the forex market, you can find yourself struggling.
So many new entrants into the forex market always tend to search for the ‘ultimate’ forex trading system. And there are so many such trading systems being flouted on the internet as the next best thing.
A good trading system will provide you ‘signals’ or ‘alerts’ about market movements as they arise based on popular Forex indicators like the Relative Strength Index and MACD lines. However, what you need is a complete trading system, one that gives you a trading strategy or ‘auto trade’ option, not just a signal service.
With time, it is important that you take the time to develop your own trading strategies. Take the time to sit down and thrash out your entry and exit tactics.
The fact that there is so much risk and yet so much potential involved with forex trading is what draws most people to it, sort of like gambling. Its all about the adrenaline rush. And making money, of course.
There are many benefits and advantages to trading forex such as no commissions, no middlemen, no fixed lot size, low transaction costs, a 24 hour market, no one can corner the market, leverage, high liquidity, free “demo” accounts, news, charts, and analysis and “mini” and “micro” Trading
However, the speed and complexity of market movements can be a deterrent to aspiring investors. Unless you have a trading system you follow and a good grasp of the forex market, you can find yourself struggling.
So many new entrants into the forex market always tend to search for the ‘ultimate’ forex trading system. And there are so many such trading systems being flouted on the internet as the next best thing.
A good trading system will provide you ‘signals’ or ‘alerts’ about market movements as they arise based on popular Forex indicators like the Relative Strength Index and MACD lines. However, what you need is a complete trading system, one that gives you a trading strategy or ‘auto trade’ option, not just a signal service.
With time, it is important that you take the time to develop your own trading strategies. Take the time to sit down and thrash out your entry and exit tactics.
Global Forex SA
Forex stands for FOReign EXchange and represents the mechanism by which the value (price) of a currency is established in relation to another. This value is called the exchange rate and the FOREX market is the market on which the various currencies are exchanged.
The FOREX market was born because any economic transaction involving two operators of different nationalities has to pass, sooner or later, through the stage of the purchase and sale of currencies. Over the last twenty years, however, the role of pure speculation on FOREX has become increasingly important, to the extent that, today, around 90% of the transactions on this market are speculative.
The FOREX market is an "over-the-counter" market and has no precise physical location. FOREX trades are made bilaterally, between two contracting parties, who independently establish the terms of the exchange contract. So, the rates indicated by the international information circuits, such as Reuters or Bloomberg, are indicative and not operational, and there are no predetermined quantities, settlement methods and due dates.
The main actors on this market are banks, brokers, hedge funds and central banks.
The Forex market is open 24 hours a day, uninterruptedly, from Sunday night (Monday morning in Japan) to Friday evening (close of the US Markets.
The value of a currency reflects the economic situation of the country involved. The variables that describe this situation, e.g. inflation, interest rates, GDP growth, etc., are referred to as "fundamentals". They also include the exchange rate, which influences and, in turn, is influenced by the other "fundamentals".
Generally speaking, fundamentals indicating a flourishing economic situation with good future prospects tend to cause the value of a currency to rise, and vice versa.
Information on Forex Trading Currency
So what makes the forex market different from the stock market? A forex market transaction is a trade between two countries, and occurs all over the world. The two countries are 1, the country of the investor of the funds and 2, the country the money is being invested in. Most all transactions taking place on the forex stock exchange will likely be qualified through an experienced broker such as a bank.
What is involved in the forex stock exchange? The overseas market is combined from various types of dealings and nations. For those invested in the forex exchange tend to trade in boastfully large volumes along with gigantic sums of money. For those deep into the forex stock market probably have financial businesses or are in businesses where assets are bought and sold quickly. While the US stock exchange is immense you would be right to imagine the forex stock market as even more immense than the stock market in any one country overall. Those involved in the forex market are trading 365 days per year, twenty-four hours a day and sometimes on the week-ends.
It may surprise you to see the number of people who issue trades on the forex exchange. In the year 2004, almost two trillion dollars was the mean forex trading volume This is an immense number of trades for the number of daily transactions to take place. Think about how much a trillion dollars really is then double that, and this amount is the average that is traded on any given day on the forex exchange!
The forex market is not something new, as it has been used for over thirty years but with the introduction of computers, and the global web, the forex exchange is growing exponentially as growing numbers of investors begin to see how easy trading on the forex exchange can be. Forex only accounts for about ten percent of the sum of all trades between two countries but as the popularity in this market continues to grow so could that number.
Forex Market Research
What is Forex? The foreign exchange market or curr...
According to a BIS study in April 2004, average daily international foreign exchange trading volume was $1.9 trillion and is now in excess of $2.5 trillion.
Some of the participants in this market are simply seeking to exchange a foreign currency for their own, like multinational corporations which must pay wages and other expenses in different nations than they sell products in. However, a large part of the market is made up of currency traders, who speculate on movements in exchange rates, much like others would speculate on movements of stock prices. Currency traders try to take advantage of even small fluctuations in exchange rates.
In the foreign exchange market there is little or no 'inside information'. Exchange rate fluctuations are usually caused by actual monetary flows as well as anticipations on global macroeconomic conditions. Significant news is released publicly so, at least in theory, everyone in the world receives the same news at the same time.
Unlike stocks and futures exchange, foreign exchange is indeed an interbank, over-the-counter (OTC) market which means there is no single universal exchange for specific currency pair. The foreign exchange market operates 24 hours per day throughout the week between individuals with forex brokers, brokers with banks, and banks with banks. If the European session is ended the Asian session or US session will start, so all world currencies can be continually in trade. Traders can react to news when it breaks, rather than waiting for the market to open, as is the case with most other markets..
Individual currency speculators can work during the day and trade in the evenings, taking advantage of the market's 24 hours long trading day.
World Forex's advanced technical analysis and trad...
World Forex's advanced technical analysis and trading techniques can be applied to any financial market because movements in such markets are graphically represented by charts. If educated correctly you can use charting to visually identify repititions and aggregate probabilities, thereby increasing success rates.
So Why Trade the Forex ?
• It is the largest financial market in the world and very liquid• No third party interference• One consistent margin rate• Market open 24 hours per day, 5.5 days per week• Trade the hours that suit you, day or night. • Concentrate on a few currencies• No need for economic or corporate knowledge• Predetermined stops and limits – NO SLIPPAGE.• make profit buying or selling currency• An average trade is 5 hours• Low capital requirements• Capital leverage of up to 400:1
Sunday, September 27, 2009
Foreign exchange of currencies can be dated back t...
Foreign exchange of currencies can be dated back to ancient times, when merchants of different sorts traded coins from country to country. In ancient Egypt the first coins were used, and paper notes were added later on by the Babylonians. The history of Forex continues in the middle ages when foreign exchange was maintained by international banks. This enabled a growth of the European powers and contributed to the spread of foreign currencies throughout Europe and the middle east. The history of Forex is therefore perhaps the longest of all the other markets, and this is one of the advantages of Forex over other market options.
1816-The Gold Standard Changes Forex History The gold standard was a trading standard that was used as a fixed value for trading commodities. This means a certain weight in gold was established and used to trade for other currencies. This started to be in use in 1816, when the British pound was defined as 123.27 grains of gold. This meant that the British banks had a specific value that was defined and this in turn helped set the UK standard currency as stable.
Simplified..The strength of a country's currency depended on the amount of gold reserves the country maintained. So, if country A's gold reserves are double the gold reserves of country B, country A's currency would be twice in value when exchanged with the currency of country B.
The US and the rest of the world adopted the gold standard by 1880. Under the gold exchange, currencies gained a new phase of stability as they were backed by the price of gold. But the gold exchange standard didn’t lack faults. As an economy strengthened, it would import heavily from abroad until it ran down its gold reserves required to back its money; consequently, the money supply would shrink, interest rates rose and economic activity slowed to the extent of recession. Ultimately, prices of goods had hit bottom, appearing attractive to other nations, who would rush into buying sprees that injected the economy with gold until it increased its money supply, and drive down interest rates and recreate wealth into the economy. Such boom-bust patterns prevailed throughout the gold standard until the outbreak of World War I interrupted trade flows and the free movement of gold and the European nations stopped using the gold standard.
Up until WWII, Great Britain's currency, the Great British Pound, was the major currency by which most currencies were compared. This changed when the Nazi campaign against Britain included a major counterfeiting effort against its currency. The UK had suffered a great financial blow and its economical state was disastrous. In fact, WWII vaulted the U.S. dollar from a failed currency after the stock market crash of 1929 to a benchmark currency by which most other international currencies were compared.
At a conference held at Bretton Woods in New Hampshire in 1944, a new international financial framework was introduced specifically to stabilize world trade and the global economic situation. Particularly affected were Europe and Japan.
The conference resulted in the creation of:
The World Bank International Monetary Fund (IMF), and Bretton Woods Exchange System
The World Bank and the International Monetary Fund are collectively known as the Bretton Woods Institutions. Under the Bretton Woods Exchange System, the base currency, being the US Dollar, was pegged to the value of gold at a rate of $35 per ounce. Other currencies were then pegged to the US Dollar and allowed to fluctuate 1% either way. However, this fixed exchange rate system allowed any country to devalue or revalue its currency to fulfill the local financial and economic needs, particularly to make their exports more competitive in the global market. The massive US balance of payments deficits of early 1960's began casting shadows of doubt in the strength of the US dollar.
During the same decade, the currency crisis in Europe, mainly in the United Kingdom, France and Germany brought about the end of the Bretton Woods accord.
The United States, under president Nixon, reacted in 1971 by devaluing the dollar and forcing realignment of currencies with the dollar. The Bretton Woods Accord was thereby replaced by the Smithsonian Agreement. It was similar to the Bretton Woods Accord in that it worked on a fixed rate but was not backed by gold and also allowed for a 2.5% fluctuation instead of the previous 1%.
In 1972, the European community tried to move away from its dependency on the dollar. The European Joint Float was established by West Germany, France, Italy, the Netherlands, Belgium and Luxemburg. The agreement was similar to the Bretton Woods Accord, but allowed a greater range of fluctuation in the currency values.
Both agreements made mistakes similar to the Bretton Woods Accord and collapsed. The collapse of the Smithsonian agreement and the European Joint Float in 1973 signified the official switch to the free-floating system. This occurred by default, as there were no new agreements to take their place. Governments were now free to peg their currencies, semi-peg or allow them to freely float. In 1978, the free-floating system was officially mandated.
This market is popularly known as the International Monetary Market or IMM. This IMM is not a single entity. It is a collection of all financial institutions that have any interest in foreign currencies all over the world. Banks, Brokerages, Fund Managers, Government Central Banks and sometimes individuals are just a few examples of these institutions.
In a final effort to gain independence from the dollar, Europe created the European Monetary System in July of 1978. Like all of the previous agreements, it failed in 1993.
Forex History Changes With The Introduction of The Internet.During 1994, online currency trading made its debut, with the first online Forex transaction done. Since then, the market has grown to what it is today, with a total circle of more than $2.5 trillion every day. The big change in Forex history is that now anyone could participate and invest in the market. The vast amount of people trading online Forex is due mostly to the option of margin investments that are available with online Forex trading.
On January 1, 2002, the history of Forex trading was changed with the introduction of the Euro as the official currency between twelve European nations. The Euro is now the second most frequently traded currency in Forex markets. The countries first added to the Euro currency were: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.
London was, and remains the principal offshore market. In the 1980s, it became the key center in the Eurodollar market when British banks began lending dollars as an alternative to pounds in order to maintain their leading position in global finance. London’s convenient geographical location (operating during Asian and American markets) is also instrumental in preserving its dominance in the Euromarket.
Today, the major currencies, such as the U.S. dollar, Euro, British pound, Swiss franc and the Japanese yen, move independently from other currencies. The currencies are traded by anyone who wishes, including an influx of speculation by banks, hedge funds, brokerage houses and individuals. Only on occasion do some of the central banks intervene to move or attempt to move currencies to their desired levels. The underlying factor that drives today's forex markets, however, is supply and demand. The free-floating system is ideal for today's forex markets. The supply and demand of currencies are driven by three factors, including interest rates and interest rate differentials, commodities and global trade.
The forex market is the prime market of the world by all which all others can be considered derivatives (like futures and options).
With this growing volume, 24 hour convenience, the ability to trade anywhere in the world, ease of access to data and information and the leveraged margin accounts from retail brokers, this market is an ideal trading arena.
Learning the basic skills in forex, such as how to...
Learning the basic skills in forex, such as how to read forex charts, is really important.This is because once you have this vital skill under your belt, it will be a lot easier and quicker when the time comes for you to learn and practice an actualforex trading system.By the time you finish this article, you'll learn how to read forex charts, as well as know the pitfalls that can occur when reading them, especially if you haven't traded forex before.Firstly, let's revise the basics of a forex trading as this relates directly to how to reade forex charts.Each currency pair is always quoted in the same way. For example, the EURUSD currency pair is always as EURUSD, with the EUR being the base currency, and the USD being the terms currency, not the other way round with the USD first. Therefore if the chart of the EURUSD shows that the current price is fluctuating around 1.2155, this means that 1 EURO will buy around 1.2155 US dollars.And your trade size (face value) is the amount of base currency that you're trading. In this example, if you want to buy 100 000 EURUSD, you're buying 100 000 EUROs.Now let's have a look at the 5 important steps on how to read a forex chart:1. If you buy the currency pair, that is, you're long the position, realise that you're looking for the chart of that currency pair to go up, to make a profit on the trade. That is, you want the base currency to strengthen against the terms currency.On the other hand if you sell the currency pair to short the position, then you're looking for the chart of that currency pair to go down, to make a profit. That is, you want the base currency to weaken against the terms currency.Pretty simple so far.2. Always check the time frame displayed. Many trading systems will use multiple time frames to determine the entry of a trade. For example, a system may use a 4 hour and a 30 minute chart to determine the overall trend of the currency pair by using indicators such as MACD, momentum, or support and resistance lines, and then a 5 minute chart to look for a rise from a temporary dip to determine the actual entry.So ensure that the chart you're looking at has the correct time frame for your analysis. The best way to do this is to set up your charts with the correct time frames and indicators on them for the system you're trading, and to save and reuse this layout.3. On most forex charts, it is the BID price rather than the ask price that's displayed on the chart. Remember that a price is always quoted with a bid and an ask (or offer). For example, the current price of EURUSD may be 1.2055 bid and 1.2058 ask (or offer). When you buy, you buy at the ask, which is the higher of the 2 prices in the spread, and when you sell, you sell at the.
If you were to look at the forex chart below witho...
If you were to look at the forex chart below without knowing that it was a currency chart, you might have thought that it was a chart of a 124 dollar stock. The snapshot of the real time forex chart below shows the relationship between the U.S. Dollar and the Japanese Yen for a three month period. Each candle represents one day of price activity, with the last candle on the forex chart showing the current value of the dollar versus the yen (124.50 yen). Consequently, an investor that day trades stocks can easily adapt to forex charts. If he feels that the dollar will go up, he simply buys. Then, for the sake of simplicity, let's say that the candles on his chart start moving up (e.g., 125.00, 125.25, 126.10, etc.). This means his balance is positive.
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