You need to develop an online Forex trading strategy and run with it. As you know, in Forex, you are not buying the corporeal currency; you are laying money on the movement of this currency. If the value of the currency rises or falls you will either make or lose money. In the world of Forex, this is known as spread trading, meaning you are placing a bet that a certain currency price will move in the way you want it to move in.Every day new traders enter the market and every day traders fail to make money. There are three main reasons why people fail to make money in trading the Forex. First, they don't set a budget for each trade and end up losing way more than they can pay for to lose. Second, they don't have a solid Forex trading strategy. Third, they lack the discipline it takes to be a trader. Most people fail in all three of these areas, but even failing in one area can destroy a trader.Before you begin trading, you need to sit down and figure out what you can spend on each trade you make. You need to know exactly how much money you can afford to lose and how much you wish to gain on each trade. If by some chance a trade happens to go against you and you start losing money, you shouldn't close out of a trade until you reach your losing marker. When a trader enters the market, they enter with high expectations and don't expect to lose money. When they start to trade and something goes wrong, they panic and bail out. In turn, they miss out on the chance that their odds will turn and they might make some money on that trade. This is why it is so important to have a game plan before trading.Thursday, 28 August 2008
Online Forex Strategy | ForexGen
You need to develop an online Forex trading strategy and run with it. As you know, in Forex, you are not buying the corporeal currency; you are laying money on the movement of this currency. If the value of the currency rises or falls you will either make or lose money. In the world of Forex, this is known as spread trading, meaning you are placing a bet that a certain currency price will move in the way you want it to move in.Every day new traders enter the market and every day traders fail to make money. There are three main reasons why people fail to make money in trading the Forex. First, they don't set a budget for each trade and end up losing way more than they can pay for to lose. Second, they don't have a solid Forex trading strategy. Third, they lack the discipline it takes to be a trader. Most people fail in all three of these areas, but even failing in one area can destroy a trader.Before you begin trading, you need to sit down and figure out what you can spend on each trade you make. You need to know exactly how much money you can afford to lose and how much you wish to gain on each trade. If by some chance a trade happens to go against you and you start losing money, you shouldn't close out of a trade until you reach your losing marker. When a trader enters the market, they enter with high expectations and don't expect to lose money. When they start to trade and something goes wrong, they panic and bail out. In turn, they miss out on the chance that their odds will turn and they might make some money on that trade. This is why it is so important to have a game plan before trading.
Tuesday, 19 August 2008
ForexGen | Currencies Outlook
(GBP) bounced inline with the Euro but was unable to hold gains retreating during the US session. The Market is becoming increasingly certain that the BOE will cut rates before the year’s end and this could weigh on the Pound going forward. Overall the GBP/USD traded with a low of 1.8618 and a high of 1.8720 before closing the day at 1.8650 in the New York session.
(AUD) gained as the commodity complex bounced lead by Oil and Gold which reclaimed the $800 level briefly before retreating with the Aussie. Attempts to rally were met with very good selling pressure especially as support for the AUD/JPY faded. Markets still see a 50/50 chance of 50 basis point cuts in September. Overall the AUD/USD traded with a low of 0.8652 and a high of 0.8748 before closing the US session at 0.8680. Looking ahead, RBA minutes from the August Meeting.
ForexGen | Trade Desk Thoughts: Reserve Bank of Australia Meeting Minutes
Release Explanation: The Reserve Bank of Australia is releasing the Minutes of the previous meeting, that discussed the need, or not, to hold or reduce interest rates. The information will allow a glimpse of what the tone is likely to be at the next meeting, and may just confirm for traders that they were correct in driving aussie valuations as low as they have done recently.
Trade Desk Thoughts: The Board has decided to leave the cash rate unchanged at 7.25 percent, but said it may need to cut rates soon to avoid a slowdown in the economy. Tighter financial conditions are causing the economy to slow while on the other hand rising trade would continue to substantially add to the national income. The Reserve Bank is expecting to have low economic growth in the second and third quarters. The bank is still aiming to keep inflation at an average of 2-3 percent.
Trade Desk Thoughts: The Board has decided to leave the cash rate unchanged at 7.25 percent, but said it may need to cut rates soon to avoid a slowdown in the economy. Tighter financial conditions are causing the economy to slow while on the other hand rising trade would continue to substantially add to the national income. The Reserve Bank is expecting to have low economic growth in the second and third quarters. The bank is still aiming to keep inflation at an average of 2-3 percent.
The main bullet points were:
CPI to reach 4.5% by year end- U.S. export markets may be affected by the economic slow-down- China's slowing of growth was noted- Japanese export markets were deteriorating- Slower European growth was noted- Australian consumer spending has deteriorated significantly in 2008- Housing stocks were up and building approvals were down- Household net worth declined by 5% in 2008- Business conditions were stable- Employment growth may moderate- Market expectations about monetary policy in Australia had changed significantly in the past month, reflecting the accumulating evidence of slower demand in the economy- The market had now fully priced in a cut in the cash rate by October, with a further cut by February- The national accounts for the June quarter, to be published in early September, were likely to show that growth of GDP had been low- Weighing up all these considerations, members judged that the current stance of policy was appropriate for the time being. Nonetheless, given the slower trend in demand, scope to move towards a less restrictive setting of monetary policy was judged to be increasing.
CPI to reach 4.5% by year end- U.S. export markets may be affected by the economic slow-down- China's slowing of growth was noted- Japanese export markets were deteriorating- Slower European growth was noted- Australian consumer spending has deteriorated significantly in 2008- Housing stocks were up and building approvals were down- Household net worth declined by 5% in 2008- Business conditions were stable- Employment growth may moderate- Market expectations about monetary policy in Australia had changed significantly in the past month, reflecting the accumulating evidence of slower demand in the economy- The market had now fully priced in a cut in the cash rate by October, with a further cut by February- The national accounts for the June quarter, to be published in early September, were likely to show that growth of GDP had been low- Weighing up all these considerations, members judged that the current stance of policy was appropriate for the time being. Nonetheless, given the slower trend in demand, scope to move towards a less restrictive setting of monetary policy was judged to be increasing.
The RBA staing that the forex market had already priced in two rate cuts from the bank was interesting, very true it seems, but interesting that it was acknowledged that the aussie valuations have 0.50% of overnight rate cuts already embedded.
ForexGen | Euro - is it good for Forex?
In the Forex market there are several major currencies - one of those is the Euro. What is the Euro? It is a single currency of the European Economic and Monetary Union (EMU) introduced in January 1999. EMU members then were Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal, and Spain.
The use of a single currency across many countries has both advantages and disadvantages in relation to the forex . One of the biggest benefits of the euro is that the exchange rate is lowered, thus making investment across borders easier. There are risks in the changes in the value of the currency. This means that companies find it risky to import or export outside their currency zone and that profits could be lowered.
Using a unified form of currency eliminates this worry. It creates a more risk free import and export area, which already relies heavily on intra-European exports.The foreign exchange market is the largest and most liquid trading market in the world. Unlike the stock exchange, this market does not have a certain trading place or closing time. Instead, over $2 trillion are traded and sold every day (almost 6 days a week). It never closes and trading takes place twenty-four hours a day during the business week.
Monday, 18 August 2008
ForexGen | Daily Major Currencies Outlook
U.S. Dollar
Trading (USD) traded in a tight range against most of the majors, buoyed by continued weakness in Oil but hurt as stocks weakened. Speculation that government backed Fannie Mae and Freddie Mac would have to be bailed out cast a shadow of the banking sector. In the U.S. share markets, the NASDAQ was down 35 points (-1.45%) and the Dow Jones was down 180 points (-1.55%). Crude Oil closed down $0.90 ending the New York session at $112.87 per barrel. Looking ahead, July Building Permits are forecasted at .97M and Housing Starts at .96M. Also released PPI expected at 0.6% in July with a Core reading of 0.2%.
Trading (USD) traded in a tight range against most of the majors, buoyed by continued weakness in Oil but hurt as stocks weakened. Speculation that government backed Fannie Mae and Freddie Mac would have to be bailed out cast a shadow of the banking sector. In the U.S. share markets, the NASDAQ was down 35 points (-1.45%) and the Dow Jones was down 180 points (-1.55%). Crude Oil closed down $0.90 ending the New York session at $112.87 per barrel. Looking ahead, July Building Permits are forecasted at .97M and Housing Starts at .96M. Also released PPI expected at 0.6% in July with a Core reading of 0.2%.
The Euro(EUR) made day highs as storms threatened Oil platforms in the Gulf of Mexico sending Oil above $115 per barrel. As the storms look set to miss, Oil retreated taking the Euro along for the ride. A blow out in Eurozone Trade Deficit by 3 Billion in June also weighed on the single currency. Overall the EUR/USD traded with a low of 1.4645 and a high of 1.4768 before closing the day at 1.4700 in the New York session. Looking ahead, German PPI is expected at 0.7% in July along with the August ZEW survey seen improving slightly to -62.
(JPY) was relatively unchanged against the USD but gained against most currencies as weak US banking stocks sparked further Yen Buying. Overall the USDJPY traded with a low of 109.96 and a high of 110.55 before closing the day around 110.10 in the New York session. Looking ahead, Bank of Japan Rate announcement and Press Conference widely expected to hold at 0.5% on weakening growth outlook.
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