Finance, Forex, Forex tips, Currency news, Forex strategies

The 7 Most Common Forex Trading Mistakes

noreply@blogger.com (The financier) — Sun, 30 Nov 2008 00:47:40 PST

When trading currencies online, there seems to be no end to the mistakes a beginning forex trader can make. Beginning traders are always the most susceptible, but experienced traders can often revert back into bad practices as well. Here are some of the most common trading mistakes listed in no particular order, and how to avoid them.

Predicting instead of reacting. Otherwise known as overconfidence. This usually happens after a winning trade or two. The trader starts to think that if he can enter a trade sooner, he will get more pips. He begins to believe he can pick the top or bottom before the market reveals it to him. So instead of reacting to what the market is telling him, he starts to predict what the market will do. He enters a trade and the market continues its move, which is against him. Now, does he admit he was wrong and close his position, or does he add to it?

Adding to losing positions. Here is an extension of predicting instead of reacting. Look, you just entered a trade and the market is going against your position. The market is telling you, you are wrong. Now is the time to close your position, not add to it. If you add to your losing position, you are making at least two incorrect decisions. First, you are predicting the market will turn around. Second, you are hoping the market will prove you right because you are unable to admit you made a losing trade. Losing trades are a fact of life in the forex market. You weren't wrong, simply, your edge didn't play in your favor on this trade. Close your losing position and move onto the next trade.

Insufficient capitalization. Forex trading is already highly leveraged. Insufficient capitalization just magnifies the potential problems you can face. If you read about the famous and big name traders, they never use more than 1% - 2% of their trading capital on a position. Get out a calculator and let's see... 1% of $10,000 is $100. So as a position trader who might have a stop-loss order of 100 pips, you can only trade one mini lot of one currency pair for each $10,000 in your trading account. That is, if you want to trade like the pros. Do you have $10,000 in your account? Why do forex dealers boldly advertise you can start trading with only $250 then? Because they are in business to make money, and if they can convince you to commit trading errors, they stand a much better chance that they will soon have your money.

Overtrading. A close cousin of insufficient capitalization. Knowing that very few currency traders trade with sufficient capital in the first place, they further compound the potential problems by trading too actively and in too many currency pairs. Spreading themselves too thin you might say. Potential problems include loosing focus and margin calls. Getting a margin call is a very irresponsible position for a forex trader to be in and is a direct result of overtrading, over leveraging, and insufficient capitalization. This is as close to the perfect recipe for failure as you can get.

Not using stop-loss orders. There are very few times when not using stop-loss orders is the correct action to take. Large traders with several hundred or more lots don't want to advertise where their stops are placed is one. The other might be scalpers whose stop is only 10-15 pips away. By the time they figure the math and enter it in the system, the price might already be there or even past it. And some forex dealing stations won't let you place stops closer than 15 pips anyway, especially in fast moving situations. Other than those times, you need to put stop-loss orders in on every position. It is in your own best interest to protect yourself. I know, some people whine that their stops are always being run by the dealer. A whole article could be written on stop-loss order management, if not a complete chapter in a book. Let's just say for now, don't put them where everybody else does, and don't put them too close.

Trading as a hobby. Golf is a hobby and it costs you money to play. Horseback riding is a hobby and it costs you money as well. The point is hobbies cost money, business makes money. You need to treat your forex trading as a business if you ever hope to make money on a consistent basis. That means keeping records, keeping a trading journal, and have a written business plan. You wouldn't invest money into a start up business without first seeing a business plan, so why would you invest money into your own trading account without the same thoughtful consideration.

Not having a trading plan. This is one of those catch-all mistakes. If you have a written trading plan, and follow it, you will already have identified and hopefully eliminated all of the above mistakes. If you don't have a written trading plan, you are almost assuredly making some, if not all of the above mistakes. Maybe not all at once, but even occasional mistakes add up quickly. Do yourself a favor and don't put on another trade until you think through and write down the response for all of the above mistakes and any others you can identify, as well as entry and exit rules. Then follow it.

These are just some of the many mistakes you can make as a forex trader. You need to take responsibility for yourself and your money and act in your own best interest. The currency markets are a zero sum game and the many players are out to make a profit. Don't let them profit with your money. Do your best to eliminate the above mistakes, and you will go a long way to ensuring you are the one who profits in the forex market.

Weekly Analysis Of Major Currencies

noreply@blogger.com (The financier) — Sat, 29 Nov 2008 04:34:19 PST

“Is the worst behind us?” we asked last week. “If crude continues to drip lower, “ we concluded ,”it could provide yet another reason for a dollar counter trend rally.” With oil falling below $125/bbl by end of trade Friday, the massive sigh of relief from dollar bulls could be heard around the world. As a result, the greenback picked up more than 100 points on the euro by end of the week although the US economic data was mixed at best.

Housing continued to be a problem as Existing Homes plunged -2.6% versus -0.1% projected and LEI data printed negative for 7th out of the past 9 months. However by Friday US economic data actually proved supportive with U of M survey jumping back to the 60 level and Durable Goods registering a surprise increase 0.8% versus forecasts of a -0.3% decline. Furthermore, as we noted in our Friday note, ”with markets already so preconditioned to bad economic news from the U.S., the greenback may not weaken much further unless the data shows substantial deterioration from the prior month."

With the greenback clearly stabilized for now, the question forward is can the rally continue? The answer as is so often the case may depend on the NFPs’. The front of the week may actually prove dollar positive as flash GDP for Q2 could show surprising strength of 2% versus only 1% the quarter prior. However, the labor data holds the key. If NFPs surprise to the downside, most importantly breaking the -100K barrier, dollar longs will be hard pressed to rally the unit as expectations of a severe slowdown in the second half of the year will only harden the view of the bears that the worst lies ahead.

Euro: No Tumble Despite Trouble

On Thursday night after the IFO numbers were released we noted, “The IFO survey of German consumer confidence fell to a three year low piercing through the psychologically key 100 figure as it printed at 97.5 versus forecasts of 100.1. Sentiment has turned sharply lower as the German economy has finally succumbed to the triple punch combination of higher oil prices, higher interest rates and higher exchange rates.

Germany has been the primary driver of growth in the EZ and tonight’s data bodes badly for the region as a whole. Earlier in the night markets saw a big plunge in French business confidence and a much larger uptick in Spanish unemployment to 10.4% indicating that the environment in the rest of the 15 member union is even worse. Given such rapidly deteriorating economic conditions its is difficult to imagine that the ECB would be willing to tighten further and risk tipping the worlds largest economic zone into a full blown recession.”

Surprisingly enough however, the EUR/USD held up relatively well as the unit continues to attract safe haven flows. This appears to be the single currency’s only source of strength, but for the being that may be enough to maintain the 1.55-1.60 range. The European economic calendar is relatively subdued next week with German Retail Sales and CPI estimates the only two events of note. The consumer in the region’s largest economy is likely to show further weakening, but the key report may be the inflation numbers. If they jump above 4% as projected, expect more hawkish rhetoric from the ECB which could lend support to the pair.

After Yield Forecasts Curb A Carry Breakout Can USD/JPY Push 108.50?

Like many of its major counterparts, USD/JPY passed another week without deciding a dominate trend. Even more frustrating was the fact that a long-term buildup by the pair for a momentous breakout (in an ascending wedge) was completely deflated by a false breakouts over the past two weeks. Nevertheless, there are still key levels that still stand against the market finding a dominate direction (namely 108.50 to the upside and 104 for bears). Effectively, the quickly faded breakouts and ongoing congestion is a strong reflection of the fundamentals underlying the pair. This past week, risk appetite and carry interest were buoyed by second quarter earnings and write downs that were better than the market’s severely depressed forecasts (though they were still very disappointing numbers). However, 108.00 has held out for USD/JPY, and the DailyFX Carry Trade Index has pulled back from resistance, due to concerns that the outlook for yields may not compensate traders for the threat of high volatility. Such apprehension was catalyzed by the surprise RBNZ rate cut. While interest rate expectations have long forecasted a spurt of policy tightening for key low yielders (USD, EUR, CHF) and relatively staid projections for the other end of the spectrum (GBP, AUD, NZD), few were prepared to actually see differentials start to contract. As long as there are credible fears over credit and financial market conditions (not to mention the drop in capital markets), risk appetite will be a guided by expectations for returns.

Elsewhere, the economic docket was dotted by a few notable indicators that have set the tone for the health of the Japanese economy. For the first half of the week, the May All Industry Activity Index and physical trade balance for the following month added a fundamental edge to price action. The activity gauge rose for a third consecutive month, but the market’s reaction was modest as most of the indicator’s components were known well in advance. The smallest trade surplus in five months was a little more influential though as exports actually fell for the first time in four years – suggesting the export-dependent economy could be in significant trouble with the global slowdown. Top scheduled event risk was read in the national CPI numbers for June though. Headline inflation jumped to a decade high 2.0 percent clip while even the core figure (excluding food and energy prices) was just off a 10-year high after finally crossing back above 0.0 percent.

As the coming days burn on, we will once again see little interest in the fundamental direction of the Japanese economy, though employment, household spending, consumer wages, housing and retail sales data makes for a good mix. Instead, the greatest potential for finding direction will once again fall to the meanderings of general risk sentiment and the carry trade. Second quarter earnings is essentially behind us and the Fannie/Freddie issue has more or less faded into the background. This week, the real driver for risk trends is the US data (2Q GDP, NFPs) which will act as a benchmark for global growth and thereby a barometer for monetary policy.

Cable Keeps Its Cool

The economic data form UK provided little cause for celebration as virtually all of the releases disappointed to the downside. Most notably Retail Sales dropped by 3.9% versus –2.6% expected as purchases of apparel and food declined markedly. The UK consumer is clearly feeling pinched and although the BoE monetary policy is unlikely to ease before the year end, the situation on the street is becoming more troubling by the day as demand continues to contract. As we stated in our note on Thursday, “If the recent drop in oil prices provides a boost to spending in the fall then BoE will maintain its neutral stance. However if conditions worsen materially Mr. King and company may have to take Mr. Blanchflower’s advice and lower rates quickly.”

Yet the key reason that cable displayed relative strength last week was precisely because the MPC minutes revealed a much more hawkish slat than most market participants expected. Instead of voting 8-1 to keep rates steady, the actual vote turned out to be 7-1-1 with one member voting to hike the. According to Ifrmarkets, ““Tim Besley unexpectedly voted for a 25bps hike on the grounds the BOE credibility is suffering a great deal due to overshooting inflation, and a rate hike now would help restore its reputation.”

The BoE therefore remains surprisingly stubborn in its attitude towards monetary policy but if as expected next week’s data shows a continuing contraction in economic activity, the pressure on Mr. King and company to ease before the year end is likely to rise. We remain convinced that cable’s 5% yield is vulnerable to a cut and therefore the 2.0000 level continues to form a relatively stiff resistance in the pair.

Inflation May Decide The Fate Of The Franc Next Week

The Swiss Franc would significantly weaken throughout the week as risk appetite increased on the back of comments from U.S. Treasury Secretary Hank Paulson and Philadelphia Fed President Charles Plosser. Paulson’s reiteration of the importance of strong support from the government of the GSE’s would lead to Congress passing the bill to provide a line of credit to the beleaguered GSE”s. Plosser would immediately follow those comments with prepared remarks warning that U.S. monetary policy is too accommodative at present and must be adjusted prior to an economic turnaround fully taking hold or the US risks both increasing inflationary pressures and a crisis of confidence in the Federal Reserve. The remarks would spark broad based bullish dollar sentiment as markets re-priced interest rate expectations, ultimately rallying the pair over a 100 points. USD/CHF would end the week rising above the 1.04 handle on the strength of a considerable improvement in U.S. Durable Goods Orders, before finding resistance.

The Swiss economic docket provided very little impact on the currency’s price action despite a trade report showing weakening domestic demand. The Swiss trade balance surplus widened to a record high of 2.141 billion, as demand from Asian markets offset slumping orders from the U.S. and Europe. However, declining demand fro imports demonstrates the weakening demand from consumers, who continue to see their purchasing power diminish as inflation has risen to 2.9%- the highest in 15 years. Producer and import prices rose to the highest level in 19 years rising to 4.5% following 3.9% in May, signaling that consumer prices may continue to accelerate.

Next week’s calendar will provide insight into the level of inflationary pressures and its affect on consumer consumption. Indeed, Swiss consumer prices are expected to rise to 3.0% from 2.9%, as producers pass on the costs of increasing energy and raw materials. Despite , rising costs consumers have remained resilient with retail sales rebounding in May, the UBS consumption indicator will signal if demand will continue to remain firm or succumb to increasing costs. The KOF leading indicator is expected to show that the economic outlook I dimming as producers contend with slowing demand from their main trading partners. The Swiss Franc will be subject the prevailing risk sentiment which has been generating momentum with several U.S. banks reporting smaller write-downs than expected. However, many industry insiders are still expecting further fallout from the subprime crisis, which would send the pair lower. Technically the USD/CHF is expected to see significant resistance until the 200-Day SMA at 104.06, which it may take aim at with continued positive earnings and the absence of credit concerns.

Canadian Dollar Eyes Make-or-Break Week Ahead

Disappointments in key Canadian economic data pushed the domestic currency lower against the US dollar for the second consecutive week of trading. An ostensibly positive result in Canadian Retail Sales figures fell below analysts’ bullish forecasts, and the CAD tumbled as a result. Statistics Canada reported that headline Retail spending rose 0.4 percent through the month of May—its third consecutive monthly advance. Yet the underlying picture clearly showed that the improvement in sales came on sharp rises in gasoline costs—gasoline station sales surged 2.4 percent through the period. When adjusted for prices, Retail Sales only gained 0.1 percent and year-over-year gains fell to their lowest since January, 2004.

Energy price gains likewise made their way into the most recent Consumer Price Index figures, as the headline domestic inflation rate surged to its highest in 3 years at 3.1 percent. Yet the more important Bank of Canada Core CPI figure actually remained nearly unchanged at 1.5 percent and reinforced opinions that the BoC would leave rates unchanged through the medium term. The central bank explicitly targets a Core CPI rate between 1 and 3 percent, and an inflation rate towards the lower end of its band leaves officials in a somewhat-comfortable position to leave rates as-is. It will be important to watch whether such strong headline price gains seep into the typically stable Core CPI number; the future of Canadian interest rates will depend on inflation expectations.

The week ahead will do little to clarify inflation outlook for the world’s eighth largest economy, but monthly Gross Domestic Product figures will combine with an incredibly packed US economic calendar to force major volatility out of the USD/CAD. Highly-anticipated US Consumer Confidence, 2nd Quarter GDP, and Nonfarm Payrolls reports are all due within a three day span—virtually guaranteeing sharp moves in US dollar pairs. Traders will clearly monitor any surprises out of forthcoming North American economic data releases; such a confluence of major news could be just what traders need to force the USD/CAD out of its multi-month trading channel.

US Dollar Sentiment To Drive The Aussie Once Again

Last week, a dual set of inflation metrics offered encouraging news to the Reserve Bank of Australia. Producer Prices eased to 4.7% in the year to the second quarter versus 5.3% expected, marking the first decline since June 2007. A conflicting report showing higher-than-expected second quarter Consumer Prices (4.5% versus 4.3% expected) failed to buoy AUD/USD the following day. This makes sense: Producer Prices is the more forward-looking of the two metrics because it takes time for producers to pass on higher production costs by charging more for finished goods. Lower producer prices in the second quarter point to an easing in consumer costs and thereby the overall inflation level in the third, making second-quarter consumer prices largely irrelevant. In the broad scheme of things, it appears RBA policy rates are indeed creating the desired disinflation that Glenn Stevens and company had hoped for. The week was rounded out with June’s New Motor Vehicle Sales. We had suggested sales were “to extend their current downtrend: high borrowing costs make cars difficult to afford while rising petrol prices make them expensive to operate.” Sure enough, the metric printed at 1.4% in the year to June, a 16-month low. On balance, the data failed to produce any meaningful impact on the AUD/USD. In forecasting last week’s developments, we concluded that “with few changes likely on the horizon in the broad macro picture of the Australian economy, AUD/USD may once again find itself trading squarely on US dollar sentiment.” This, it seems, is precisely what has happened.

Looking ahead, Australian data appears destined to follow a predictable pattern this week. June’s New Home Sales figures will likely decline again having dropped -5.0% in May as deteriorating growth prospects and high borrowing costs deter consumers from committing to big-ticket purchases. Building Approvals will follow suit, with forecasts calling for an annualized decline of -4.1%. The Trade Balance may offer the single piece of silver lining to the week’s otherwise dismal showing as the deficit is expected to contract to –A$100 million in June versus –A$965 million in the preceding period. May’s reading was heavily skewed by a 17% rise in fuel imports as oil prices continued to soar. Imports may have eased a bit in June as consumers take stock of deteriorating economic conditions and pare back on expenses. Indeed, Westpac’s measure of consumer confidence dropped -5.7% in June versus 2.7% in May. While this likely spells improvement for the trade deficit, it will mean decline for June’s Retail Sales result: the headline figure is to print flat at 0.0% having grown 0.7% in May. All told, we do not expect the macro picture to deviate from established themes, meaning AUD/USD will yield to US dollar sentiment again.

Kiwi Selling To Continue As Data Heads Further South

Last week started off slow for New Zealand data as June’s Credit Card Spending and Visitor Arrivals data validated our forecasts: the former metric fell to 3.3% from 5.9% in the preceding month, while the latter collapsed into negative territory to print at -1.4% versus a revised 9.1% in the previous period. We had reported that credit card receipts are “sure to continue downward as Kiwi consumers tighten their belts amid deepening economic malaise. [Further,] while the recent weakness in the Kiwi dollar may have otherwise helped June’s Visitor Arrivals, tourism surely contracted as the global slowdown takes its toll on discretionary spending the world over.”

The undisputable center-piece of the week was a surprise from the Reserve Bank of New Zealand. The deepening recession moved policymakers to cut interest rates by 25 basis points, putting benchmark borrowing costs at 8.00%. This is the first RBNZ rate cut since 2003. The accompanying release cited greater-than-expected risks to growth and tightening international credit conditions as primary catalysts for the decision. Borrowing a page from Australia's playbook, Governor Alan Bollard said that monetary policy has been "reasonably tight for some time, and is now restraining activity and medium-term inflation pressures." Bollard added that although recent spikes in oil and food prices will bring inflation to a peak near 5% this year, the slowing economy will act to bring price pressure to target levels in the medium term. Shaping expectations in a typically candid fashion, Bollard concluded by saying that "provided that the outlook for inflation continues to improve and there is no excessive exchange rate depreciation, we would expect to lower the OCR further." The Kiwi dollar responded sharply, dropping 82 pips in the first 10 minutes and continuing lower for the remainder of the week.

This week is unlikely offer anything to curtail the vigor of Kiwi bears. The Trade Balance will likely deteriorate: Oil prices continued higher in June, inflating the cost of imports while a drought likely cut into farm production to depress export volumes. Expectations call for a deficit of –NZ$350 million versus –NZ$195.8 million in May. July’s edition of NBNZ Business Confidence is will almost certainly continue lower as an end to New Zealand’s economic malaise is far from near

8 Basic Tips on Choosing Best Forex Broker

noreply@blogger.com (The financier) — Sat, 29 Nov 2008 04:24:18 PST

There are some basic notices that you should consider when you want choosing online forex broker.

#1- Spread Amount

The spread, which is calculated in pips, is the difference between how much you can buy or sell a currency at a specific point in time.

Forex currencies are not traded through a central exchange market, so the spread can be different depending on the forex broker you use. Some online forex brokers have variable spread; some of them have two spread amounts that depend to day and night.

Some of them their spread depends to the position of market. When market is quiet the spread is small and when market is busy the spread is high. I prefer forex brokers that have fixed spread, because over the long term fixed can be safer.

#2- Execution

- How fast is the broker's order execution?

- Do they offer automatic execution?

- How much can you trade before having to request a quote?

- Do they trade against their clients?

The best way to find out is to open a demo account and give them a test drive.

#3- Leverage Options

Leverage is expressed as a ratio between the total capital that is available to be traded and your actual capital. For example, when you have a ratio of 100:1, your forex broker will lend you $100 for every $1 of actual capital you have. Leverage is a necessity in forex trading because the price deviations in the currencies are set at fractions of a cent.

Before choosing an online forex broker notice that what is their leverage. Many brokerages offer a flexible margin that allows you to choose the leverage that's right for you.

#4- Account Types

Notice the forex broker you choose has mini account or not. Mini account is designed for those new to online currency trading and those with limited investment capital. There is a smaller deposit required to start trade of just $300 or less.

#5- Trading Platform

Good trading software will show live prices that you can actually trade at, not just indicative quotes. It will offer Limit and Stop orders, and ideally will let you attach these to your entry order. One-Cancels-Other orders are another useful feature - they mean you can set up your trade and then leave the software to get on with it.

#6- Dealing tools and value-added services

Find out online forex broker that offers the best resources and information to help you make the smartest trading decisions. A good company should offer real-time charts, technical analysis tools, real-time news and data, and software or website support. Be weary of any company that refuses to share information or trial versions before opening up an account. You will want to try out their system before you choose to invest money in it.

#7- Support

Forex is a 24 hour market, so your online forex broker should offer 24 hour support. You should also check if you can close positions over the phone - essential in case your PC or internet connection crash at a critical moment. You could contact to their Internet help desks to see how quickly they respond to enquiries.

#8- Get Referrals

Ask around and read forex forums to find out which forex brokers other people use and why they selected a specific broker.

Forex Trading - An Introduction To Technical Analysis

noreply@blogger.com (The financier) — Sat, 29 Nov 2008 04:22:46 PST

There are two types of analysis used in Forex trading - fundamental analysis and technical analysis. Fundamental analysis examines current political and economic events in order to predict movements in currencies, while technical analysis uses historical economic data to predict movements in the Forex market.

There are three underlying assumptions to technical analysis:

1. Movements in price are the result of a combination of all the forces is in the market. While currency prices can be affected by all sorts of things including political events, economic conditions, supply and demand and even the weather, technical analysis is not concerned with the reasons for movements in the market but is solely concerned with the movements themselves.

2. Currency prices follow trends. Over the years a number of market patterns have been recognized and technical analysis assumes that these have predictable consequences.

3. Movements in price follow historical trends. Forex data has been collected from more than 100 years and, over time, a number of patterns have emerged. These patterns are indicative of human psychology and the way in which people react to certain circumstances.

Although most Forex traders will use fundamental analysis to support their trading strategy, they will also rely heavily on technical analysis. The major problem with fundamental analysis is that it requires a detailed knowledge of the political and economic conditions of a large number of countries and, for most traders, this is simply impractical. Technical analysis, on the other hand, can be applied across many different markets and currencies at the same time.

If you are new to Forex trading then you may well find the complexity of technical analysis off-putting and wonder if it is really necessary. As with almost any form of investment, you must have a strategy for trading and of that strategy must be based upon a prediction of movements in the market. Technical analysis has shown itself over time to be a sound tool for predicting such movements and is fairly accurate. Nothing of course will provide one hundred percent accuracy and currency prices are affected by a variety of different factors. It is for this reason that, while many traders use technical analysis, they also backup their trading strategy with fundamental analysis.

Every Forex broker will provide access to a range of different tools used for technical analysis and most of these tools, which will have the ability to update in real time, will generally be made available free of charge, with some additional professional analytical tools being provided for a fee.

Before you start Forex trading it is a good idea to acquaint yourself with market behavior by following Forex charts for a period of time and by studying the movements and gaining an understanding of trends. Many brokers will provide training accounts just for this purpose, allowing you to trade on paper rather than with real money.

Right Loans Through Comparative Analysis

noreply@blogger.com (The financier) — Sat, 29 Nov 2008 04:19:11 PST

Cashing on loans is an easy task now. Today there are number of loan dispensing financial institutions, which offer loans at competitive interest rates. Besides, a whole network of private lenders operates over the Internet offering you best deal on the loans. Lending the money from unscrupulous lenders might be a risky venture, and above all, it costs you more money than normal amount.

By making a comparative analysis of the various loans plans available over the Internet, you are always in a win-win situation. There is cent percent surety that what you will get is a perfect money saving bounty and nothing more. What's more, you will only pay around 3% to 5% interest rate with longer repayment time frame.

Compare Loans if you are ardent over purchasing a Car, initializing over new business strategies, celebrate festivals with innovative fervor, decorating your home exteriors and interiors, and much more. The online customized and optimized format lets you explore the latest repayment amounts as applicable on different loans. The best thing is that you can compare loans in order to get the bargain interest rates ranging 3% to 5%.

Compare loans to get first hand information about what percentage amount of LTV is dispensed; whether or not the bank or financial institution offers you low and attractive APRs; large loan amounts viz. Â£5000 to Â£100,000 are easily available or not and the cost of your payment protection insurance. Not only this, when you compare loans, you can also apply for the desired loan in minutes by filling the online application form placed by the lender therein.

Compare personal loans and track the one that goes with your desire. Think wisely and make the virtues grow every day and forever. Comparing various loan strategies will surely make you a jack with no losses to incur in your investments.

Forex Fundamental Analysis

noreply@blogger.com (The financier) — Sat, 29 Nov 2008 04:15:35 PST

Today we have better news resources than ever before to help Forex traders but the fact is most traders fail to use it correctly and lose.

Let’s look at Forex fundamental analysis in more detail

What is Forex Fundamental analysis?

Quite simply it studies all the facts in relation to the supply and demand situation of the currency and these are numerous and include:

Political factors

Interest rates

Economic health of the country

Economic policy

And many more

These are the facts and all traders see them but they draw different conclusions from what they see - this is the problem for any Forex trader.

The major problem is working out how traders view the facts and how much they have been discounted.

A simple equation for market movement is

Economic Fundamentals + Human perception = market movement

Firstly, in today’s world of lightening communications the fundamentals are discounted in seconds so trying to trade off news stories is doomed to failure.

Secondly humans are not creatures of logic – they are ruled by greed and fear - these emotions push prices to far in either direction – up or down. Ever wonder why a market collapses in the midst of very bullish fundamentals, or rallies when the news could not be more bearish?

This is human psychology at work and the emotions of greed and fear taking control of markets.

In Forex fundamental analysis the facts are their for all to see but the way they are perceived makes trading fundamentals hard, if not impossible for most traders.

The facts are there for all to see but as humans are not logical they are emotional beings and trying to trade facts is hard especially when they are discounted in seconds.

Is there a better way?

The best way to trade for Forex traders is not Forex fundamental analysis but technical analysis.

Forex technical analysis simply assumes all fundamentals will show up in price action as they are discounted in seconds – the technical analyst knows that human nature is constant and this will show up in repetitive price action.

The trader using Forex charts does not care why prices move he just wants to make profits when they do and looks for the right formations.

While technical analysis may seem simple its logic is sound, as it takes into account both parts of the equation for price movement – human psychology and the economic reality.

If you are considering Forex fundamental analysis then beware of the pitfalls and try technical analysis instead

Fall Mergers Have Yet To Yield Big Campaigns

noreply@blogger.com (The financier) — Sat, 29 Nov 2008 03:55:43 PST

September three mammoth institutions, Merril Lynch, Washington mutual and Wachovia , were purchased by Bank of America, JPMorgan Chase and Wells Fargo, respectively; the ramifications for the economy at large and the institutions are huge, and it will be up to the banks' marketing teams to make sense of these developments for consumers.

Give the perilous economic times, projecting safety and security is key, says Thomas Ordahl, who's a partner with New York City-based branding expert Group 1066. "A [major] bank going under hasn't really been a fear since the Great Depression and hasn't been a criteria for people when selecting a bank; fear is now rearing its head again," Ordahl says. "Banks are now snapping back to the old message of strength, stability, reliability and safety...[rather than] competing on products and services."

Actually, given the magnitude of these three acquisitions, more aggressive marketing might have been expected already, says Jon Swallen, svp of research for NYC-based TNS Media Intelligence. The reason it hasn't occurred, he says, is that these institutions all had major ad campaigns in swing and to change course abruptly in the fourth quarter is not easy.

So far, the most ambitious campaign has been the one involving WaMu and Chase, which makes sense given that WaMu was the only institution of the three seized by the government before flipping it to JPMorgan Chase. There was, in other words, a greater need for JPMorgan Chase to allay fears with a positive message right out of the gate. "Timing was crucial because we had to get out the word that WaMu deposits were now backed by the strength of JPMorgan Chase," says JPMorgan Chase spokesperson Thomas Kelly, who notes that WaMu depositors had withdrawn more than $16.7 billion, or 10 percent of deposits, in the 10 days leading up to the acquisition.

After the acquisition, ads immediately began to hit print and the airwaves touting that the nation's largest thrift was now a part of "America's largest bank." The half-page ads, which ran nationally, had the slogan "WaMu & Chase. Safe & Secure," and boasted, "Same free checking. Bigger security blanket," or "We love Chase. And not just because they have a trillion dollars." The bank also linked up the two Web sites within hours of the acquisition. "Ultimately, the message got out and within three business days we had positive deposit inflows into the WaMu branches," Kelly says.

The challenge now is what to do with the WaMu brand, Kelly says, though he expects that over time the WaMu brand will be phased out in geographic stages as WaMu migrates to Chase's computer system. "In the meantime, we need to support the WaMu brand and are reviewing how to do it - both in markets where there is also a Chase brand and in markets where there are no Chase branches."

Elsewhere, the marketing around the Wachovia acquisition started on a decidedly peculiar note when Citi ran full-page ads nationally to reassure Wachovia customers all would be well after the acquisition, only to be spurned at the eleventh hour when Wells Fargo made the Charlotte-based behemoth a better offer.

Since then Wachovia Securities ads have appeared in national and some regional newspapers with a twofold mission, says Wachovia spokesperson Matthew Wadley: assure customers that the integration of Wachovia Securities and A.G.Edwards, ongoing since 2007, is continuing smoothly; and that Wells Fargo, "one of Barron's Most Respected Companies in the world and an American institution since 1852," was backing the faltering bank. "Mainly, the goal is to reassure customers and to remind them that their financial advisors are always there for them if they have questions or concerns about their finances," Wadley says.

At Bank of America, meanwhile, there's been virtually no marketing promoting the new institution; that's in part due to the circumstances around the deal, which were not as dramatic as the government takeover of WaMu and the tug-of-war for Wachovia. So far, Bank of America has not veered off course from its "Bank of opportunities: campaign and Merrill is still standing on its own. However, analysts agree that a mega-campaign is likely for 2009 to boast about the services that these combined institutions can provide.

Usd/Jpy Technical Analysis for 24th November 2008

noreply@blogger.com (The financier) — Mon, 24 Nov 2008 09:44:47 PST

Technical Analysis, Usd/Jpy, Usd/Jpy Technical Analysis

clipped from usdjpytechnicalanalysis.com

Usd/Jpy Technical Analysis for 24th November 2008

The typical range trading on the daily chart continues. Both the RSI and Slow Stochastic are floating in neutral territory. The hourlies are also providing mixed signals with no specific direction. Good strategy might be to wait for a clearer signal before entering the market in this pair.

Gbp/Usd Technical Analysis for 24th November 2008

noreply@blogger.com (The financier) — Mon, 24 Nov 2008 09:41:26 PST

Gbp/Usd, Gbp/Usd Technical Analysis, Technical Analysis

clipped from gbpusdtechnicalanalysis.com

Gbp/Usd Technical Analysis for 24th November 2008

The daily chart is showing that the pair does not have a distinct direction, as the chart appears to be quite horizontal for the past 10 days. The Bollinger Bands are widened, and the 4-hour Slow Stochastic also provides no clear indication. On the hourlies, the pair has been range trading with high volatility for a while now. Waiting for a clearer sign before entering the market might be the smart move today.

Eur/Usd Technical Analysis for 24th November 2008

noreply@blogger.com (The financier) — Mon, 24 Nov 2008 09:40:03 PST

Eur/Usd, Eur/Usd Technical Analysis, Technical Analysis

clipped from eurusdtechnicalanalysis.com

Eur/Usd Technical Analysis for 24th November 2008

The 4-hour chart shows that the momentum is still bullish. However, its Relative Strength Index (RSI) floats near the upper line indicating that the current trend might be closing to its end. On the hourlies, the local bearish correction is already intact. A bearish cross of the Hourly chart’s Slow Stochastic validates that correction as well.

An overview of the Forex market

noreply@blogger.com (The financier) — Sat, 22 Nov 2008 05:11:26 PST

The Forex market is a non-stop cash market where currencies of nations are traded, typically via brokers. Foreign currencies are constantly and simultaneously bought and sold across local and global markets and traders' investments increase or decrease in value based upon currency movements. Foreign exchange market conditions can change at any time in response to real-time events.

The main enticements of currency dealing to private investors and attractions for short-term Forex trading are:

24-hour trading, 5 days a week with non-stop access to global Forex dealers.
An enormous liquid market making it easy to trade most currencies.
Volatile markets offering profit opportunities.
Standard instruments for controlling risk exposure.
The ability to profit in rising or falling markets.
Leveraged trading with low margin requirements.
Many options for zero commission trading.

Forex trading

The investor's goal in Forex trading is to profit from foreign currency movements. Forex trading or currency trading is always done in currency pairs. For example, the exchange rate of EUR/USD on Aug 26th, 2003 was 1.0857. This number is also referred to as a "Forex rate" or just "rate" for short. If the investor had bought 1000 euros on that date, he would have paid 1085.70 U.S. dollars. One year later, the Forex rate was 1.2083, which means that the value of the euro (the numerator of the EUR/USD ratio) increased in relation to the U.S. dollar. The investor could now sell the 1000 euros in order to receive 1208.30 dollars. Therefore, the investor would have USD 122.60 more than what he had started one year earlier. However, to know if the investor made a good investment, one needs to compare this investment option to alternative investments. At the very minimum, the return on investment (ROI) should be compared to the return on a "risk-free" investment. One example of a risk-free investment is long-term U.S. government bonds since there is practically no chance for a default, i.e. the U.S. government going bankrupt or being unable or unwilling to pay its debt obligation.

When trading currencies, trade only when you expect the currency you are buying to increase in value relative to the currency you are selling. If the currency you are buying does increase in value, you must sell back the other currency in order to lock in a profit. An open trade (also called an open position) is a trade in which a trader has bought or sold a particular currency pair and has not yet sold or bought back the equivalent amount to close the position.

However, it is estimated that anywhere from 70%-90% of the FX market is speculative. In other words, the person or institution that bought or sold the currency has no plan to actually take delivery of the currency in the end; rather, they were solely speculating on the movement of that particular currency.

JPY Records Further Advances against the Major Currencies

noreply@blogger.com (The financier) — Sat, 22 Nov 2008 03:57:52 PST

JPY Economic News, Japanese Yen Currency, japanese yen

clipped from japaneseyen.eu

Recently, the JPY rallied against the USD and the EUR on speculation that slides in global stocks will prompt investors to sell higher-yielding assets and pay back loans in Japan. The Yen also advanced versus the New Zealand dollar and against the British pound, as U.S. lawmakers held off taking action on a bailout requested by the nation’s automakers, spurring a reduction in so-called carry trades. A rise in U.S. jobless claims and a drop in manufacturing also helped boost the JPY. The Yen traded at 94.16 per USD from 93.69 late yesterday in New York, and at 117.13 per EUR from 116.68 yesterday.

Euro Slides against the Dollar and the Yen

noreply@blogger.com (The financier) — Sat, 22 Nov 2008 03:55:01 PST

clipped from eurocurrencynews.com

Despite aggressive steps taken by governments around Europe, such as Interest Rate reductions and stimulus spending plans, reports show that the Euro-Zone is headed towards deep recession. The EUR slipped 0.5% against the Dollar to $1.2458. The European economy continued to contract through 2008, leading to economists foreseeing no growth probably until the 3rd quarter of 2009. With inflation falling sharply, the European Central Bank has all the justification it needs for a further Interest Rate cut from the current level of 3.25%. Analysts foresee additional 50 basis point cut in December.

The Dollar Rallies, Despite the Rise in U.S. Unemployment Claims

noreply@blogger.com (The financier) — Sat, 22 Nov 2008 03:45:32 PST

clipped from usdanalysis.com

Yesterday, the Dollar gained as investors withdrew from emerging-market assets to the safety of U.S. government debt, in what is set to be the worst financial crisis since the Great Depression. However, while the greenback has appreciated against high-yield currencies, it fell against the Yen. Yesterday’s U.S. jobless data intensified concerns and signaled more trouble for the labor market, which has shed more than 1 million jobs so far in 2008. The report showed that the number of Americans filing for first time jobless benefits spiked to 542,000 last week, more than analysts had expected.