Forex Rating

Forex - Dollar pares losses as trade gap narrows

2008-02-14T09:24:00.000-08:00

The dollar pared losses against the euro and yen on Thursday after data showed the U.S. trade gap narrowed by more than expected in December.

A separate report showing first-time jobless claims in the latest week were in line with economists' expectations also added some dollar support.

The euro fell to around $1.4615 , still up 0.3 percent from late Wednesday but below $1.4630 before the data. The dollar was flat on the day at 108.27 yen from around 108.13 yen earlier.

Forex - Yen extends decline as stocks rally

2008-01-25T07:33:00.000-08:00

The euro climbed nearly 2 percent against the yen on Friday as a rally in global stocks fuelled appetite for riskier trades, putting the low-yielding Japanese currency under pressure.

Gains in high-yielding units such as the New Zealand dollar also underscored improved risk appetite as stocks rose across Europe and Asia, with Japan's benchmark Nikkei .N225 surging more than 4 percent in its biggest one-day gain in about six years.

Stock investors were cheered by a U.S. tax stimulus package, reassuring U.S. jobs data and the prospect of another Federal Reserve rate cut next week, all tending to ease fears that the world's biggest economy will slide into recession.

"You have a combination of dollar weakness and yen weakness with yen making more significant losses against other currencies, which fits in with the events that have unfolded over the last 24 hours," said Steve Barrow, currency strategist at Bear Stearns.

Stock market moves are often regarded as a barometer of risk appetite, and financial markets have calmed down after swinging wildly earlier in the week on an emergency interest rate cut by the Federal Reserve and escalating fears of a U.S. recession.

Forex-Euro bounces back as rate cut hopes ease

2008-01-24T05:51:00.000-08:00

The euro strengthened against the dollar and yen on Thursday after tough talk on inflation from European Central Bank policymaker Axel Weber dampened expectations of a possible near-term interest rate cut.

The yen retreated on the back of the bounce in the euro and as European stocks extended their rally, after earlier gaining on lingering concerns over the health of the global economy.

"For the time being, the ECB are maintaining a very hawkish line so no signs of any rate cut any time soon," said Chris Turner, head of FX strategy at ING.

"You're then left with sharply lower U.S. rates, stable European rates and with equities doing quite well at the moment ... the market is just going to focus on the dollar bearish story."

Weber said the U.S. Federal Reserve's surprise decision to cut interest rates by 75 basis points this week hasn't shifted the ECB focus on euro zone inflation, dampening mounting expectations that it too will have to cut rates soon.

The euro climbed 0.3 percent to $1.4683 by 1206 GMT and was also up 0.3 percent versus the Japanese currency at 156.60 yen , well above an early low of 154.86 yen.

The dollar was steady against the Japanese currency at 106.65 yen , off early lows.

Forex - Surprise Fed rate cut sparks U.S. dollar sell-off

2008-01-23T06:31:00.000-08:00

The dollar tumbled against major currencies except the yen on Tuesday after the Federal Reserve unexpectedly slashed its benchmark overnight lending rate in an attempt to allay market fears of a U.S. recession.

The Fed's emergency move to cut rates by three quarters of a percentage point was precipitated by a global equities rout.

The U.S. central bank's move wiped out the dollar's yield advantage over the euro, with the federal funds rate target now at 3.5 percent and official euro zone interest rates at 4 percent. This put the European currency on track to post its biggest one-day gain against the dollar in two years.

The cut, which preceded next week's Federal Open Market Committee monetary policy meeting, was not enough to prevent U.S. stocks from falling when the market reopened after Monday's public holiday. For details see [.N].

"We are skeptical that the rate decision will have a lasting impact in offsetting concerns over economic slowdown," Tom Fitzpatrick, global head of foreign exchange at Citigroup in New York, said in a note to clients. "Lower interest rates do little to address underlying weakness in the U.S. housing sector and broader economy."

In New York late afternoon trade, the euro was up 1.2 percent on the day at $1.4613 after briefly racing to $1.4643. The euro has rebounded from a one-month low against the dollar of around $1.4366, according to Reuters data.

"Under any other Fed this would not be a surprise, but this Fed has been reluctant to cater to market expectations," said Mark Meadows, currency strategist at Tempus Consulting in Washington. "This should support the euro in the short term, however our long-standing view is still that the U.S. economy will rebound and help the dollar gain into the middle of this year."

Forex-Canadian dollar firms as BoC cuts rates

2008-01-22T08:44:00.000-08:00

The Canadian dollar firmed against most currencies in volatile trade, after the Bank of Canada cut interest rates a quarter point, compared with some market speculation of a half-point reduction.

However, the currency's gains were limited as the central bank also gave a heavy hint of further loosening to come.

At 14.20 GMT the US dollar was a touch weaker against its Canadian counterpart, at 1.0320 cad from around 1.0345 just before the announcement.

The Canadian dollar was also firming against the euro, pound and yen.

Forex - Euro Softens on weak German PPI Inflation

2008-01-21T02:22:00.000-08:00

The euro softened after the release of the German PPI figures, which having come in below expectations, reminded investors that euro zone interest rates are more likely to fall later this year than rise.

German PPI fell 0.1 pct on the month in December, well below forecasts for a 0.2 pct rise. Although not momentous in itself, the figures echoed comments by European Central Bank member Yves Mersch last week who said that concerns over inflation were overdone.

Those comments then caused a sharp sell-off in the euro, which remains vulnerable to any indications that inflation is easing at a time when growth is slowing markedly.

'The market has to get used to the idea that the ECB may shift from its hawkish stance with an eye on easing policy by the end of the second quarter,' said Gavin Friend at Commerzbank.

'The market may have to wait until the next ECB meeting in order to get a better idea about the future stance of the ECB, considering that several members like Axel Weber and Jean-Claude Trichet are still sounding hawkish,' said Friend.

Until then, the economic data will be watched closely.

Meanwhile, the dollar was somewhat higher, riding on positive momentum from last week when the US government proposed a fiscal plan to support economic growth, although movements may be limited as US markets are closed for Martin Luther King Day.

The 145 bln usd package, unveiled on Friday by US President Bush, will seek to complement interest rate cuts by the Federal Reserve in order to spur consumption and avoid a recession this year. The dollar gained somewhat on the news, although analysts warn that the focus may soon revert to interest rate differentials -- weakening the greenback -- as closer analysis of the fiscal stimulus reveals it may not be sufficient.

'Fiscal help in the 1960s, 1970s and during the 2001 recession showed that there was little impact on personal spending as empirical research showed that much of the rebate was saved or used to pay previous bills rather than leading to any fresh spending,' said an analyst at BNP Paribas (other-otc: BNPQY.PK - news - people ).

In the UK, the pound was weaker after yet another housing survey, this time from Rightmove, which said prices fell 0.8 pct on the month in January.

The data reinforces the view that the UK housing market is experiencing a downward correction, and that the Bank of England is likely to cut interest rates at its next policy meeting in February.

Eyes will now turn to the release at 0930 GMT of public finance figures, mortgage approvals data, and money supply.

London 0845 GMT Hong Kong 0500 GMT

US dollar

106.14 yen down from 106.87 yen

1.1041 sfr down from 1.1043 sfr

Euro

1.4516 usd down from 1.4532 usd

154.07 yen down from 155.34 yen

1.6026 sfr down from 1.6059 sfr

0.7446 stg down from 0.7449 stg

Sterling

1.9496 usd down from 1.9513 usd

206.92 yen down from 208.39 yen

2.1521 sfr down from 2.1551 sfr

Australian dollar

0.8714 usd down from 0.8761 usd

0.4467 stg down from 0.4488 stg

92.35 yen down from 93.57 yen

Forex reserves rise by USD 5,474 mn

2008-01-20T07:05:00.000-08:00

Forex reserves rose USD 5,474 million to touch USD 281,729 million as on Jan. 11, 2008, primarily as a result of increase in foreign currency and assets collections, on a weekly basis.

As per the weekly statistical supplement of the Reserve Bank of India (RBI) released on Jan. 18, 2008, foreign currency and assets moved up USD 5,473 million to USD 272,964 million.

During the same period, the reserve position in the international monetary fund (IMF) increased by USD 1 million to USD 434 million.

However, SDRs (special drawing rights) and gold reserves remained flat at USD 3 million and USD 8,328 million respectively.

Foreign currency assets expressed in USD include the effect of appreciation or depreciation on non-US currencies (such as Euro, Sterling and Yen) held in reserves.

CIMB forms alliance to boost forex business

2008-01-19T07:14:00.000-08:00

CIMB Bank has formed an alliance with ICE Commercial Services Sdn Bhd and Lenlyn UK plc to manage the bank's retail foreign exchange (forex) business.

In a statement yesterday, CIMB said the participation agreement signed with ICE was in line with its efforts to improve customer service at its bureau de change outlets and offer new retail forex offerings in the future.

“Under the agreement, ICE will contribute its specialised expertise and operational and business processes and systems relating to retail forex. It will also assist the bank to develop staff capabilities through tailored training programmes to enhance efficiency and productivity, better customer service and improve delivery systems,” it said.

The bank said it could also leverage on ICE's global brand recognition to attract business, particularly with inbound travellers at the airport and foreign tourists.

CIMB head of retail banking, Peter England, said the partnership would bring significant boost to the business and offer better value to its customers.

“It is an opportune time for us to enhance and expand our retail forex business.”

Rupee at 39.30 against US dollar

2008-01-19T00:15:00.000-08:00

The rupee on Thursday barely changed at 39.3050/3150 against the greenback after moving in a narrow range in the day on continued dollar demand by banks amid weakness in equity markets.

The Reserve Bank of India (RBI) continued to intervene in the exchange market to block any surge the rupee in the wake of huge response from foreign investors towards Reliance IPO, forex dealers said.

The foreign institutional investors have submitted bids worth about USD 30 billion for shares of Reliance Power.

At the Interbank Foreign Exchange (forex) market, the local currency remained trapped in a range of 39.2700 and 39.3450 during the day after resuming weak at 39.31/32 a dollar from its previous close of 39.29/30 a dollar.

Dealers said banks bought dollar on behalf of the apex bank but purchases in the greenback were not as aggressive as it was on Wednesday.

Weak stock markets

Weakness in stock markets across the continent coupled with pressure on the currency continued to weigh on the rupee sentiment, they added.

The central bank stepped in when the rupee touched the intra-day high of 39.27 a dollar, a leading dealer commented.

The RBI, however, fixed the reference rate for the US currency at Rs 39.29 per dollar and for the single European unit at Rs 57.60 per euro.

The rupee premiums on forward dollar ended lower due to fresh receivings by exporters.

The benchmark six-month forward dollar premiums payable in June ended at 34-36 paise, slightly lower from 35 – 37 paise on Wednesday and the far-forward maturing in December ended sharply lower at 60 - 62 paise from 66 - 68 previously.

Cross currency trade

In cross-currency trades, the rupee weakened against the British Sterling but was stronger against the euro and the Japanese yen.

The Indian unit fell substantially against the Sterling to end at Rs 77.21/23 per pound from yesterday's close of Rs 76.89/91 per pound but surged against the single European currency to Rs 57.54/56 per euro from last close of 58.05/07 per euro.

The rupee also firmed up against the Japanese Yen to close at Rs 36.69/71 per 100 yen from previous close of Rs 37.01/03 per 100 yen.

Forex reserves up by $5.4 bn

2008-01-18T09:16:00.000-08:00

The country's foreign exchange reserves increased by a massive $5.474 billion for the week ended January 11, indicating the Reserve Bank intervened in the forex market by buying dollars to check the rise of rupee.

The reserves increased to $281.729 billion from $276.255 billion a week before, according to RBI data.

Foreign Currency Assets (FCAs) increased by $5.473 billion to $272.964 billion as against $267.491 billion a week ago, as per the Reserve Bank data.

Foreign Currency Assets expressed in US dollar terms included the effect of appreciation or depreciation of other currencies such as the Euro, Pound Sterling and Yen, held in its reserves, it said.

India's reserve position in International Monetary Fund rose by $1 million to $434 million during the week.

Gold reserves and Special Drawing Rights remained static at $8.328 billion and at $3 million respectively.

The rupee has appreciated more than 12 per cent against the dollar in 2007 following massive capital inflows. The Indian currency is trading at a nine-year high against the greenback at around 39.30 to a dollar.

Forex - Dollar slips ahead of Fed's Bernanke Testimony

2008-01-17T22:22:00.000-08:00

The dollar slipped against the euro and yen on Thursday ahead of testimony by Fed Chairman Ben Bernanke to the House Budget Committee which is expected to validate the risk of U.S. interest rate cuts already factored in to the market.

Bernanke is due to speak at 10 a.m. (1500 GMT) and investors have priced in at least a half-percentage-point cut in the benchmark U.S. rate this month, with some saying the Federal Reserve could cut rates by three quarters of a point.

Declines in the dollar after a sharp and unexpected fall in U.S. housing starts were short-lived as investors looked beyond housing to an unexpected 21,000 drop in workers filing initial claims for U.S. jobless benefits last week, suggesting some improvement in the labor market. For more see [ID:nN17481155].

"The housing data was bad but you had some counterbalancing because the jobless claims number was better than expected," said Michael Malpede, senior currency strategist at Man Global Research in Chicago. "I don't think anyone will make significant position adjustments until they see what Bernanke has to say ... They want to see just how dovish he may be."

The dollar was down 0.3 percent against the yen at 107.18 . The euro was up 0.1 percent against the dollar at 1.4678 .

The Commerce Department said housing starts fell 14.2 percent to an annual pace of 1.006 million in December, the lowest pace in 16 years. Economists were expecting a 1.140 million annual rate. (Reporting by Nick Olivari and Steven C. Johnson; Editing by James Dalgleish)

Top Forex Trading Tips

2008-01-17T06:27:00.000-08:00

* Always practise using a demo account before you go live and start risking your own money. Much like in an online casino, many Forex sites offer ‘fun money’ accounts to newcomers and it’s a good idea to play around with these for a while, until you find your feet and learn the rules of the game. It may take you several weeks or even months until you’re ready to invest your hard-earned cash in the market – but it’s worth waiting.

* Get the knowledge. Aside from practicing on a demo account, it’s essential to read up all you can about Forex gambling. There is a lot of useful information available on the internet, and you might find a user’s guide comes in handy. It’s worth investing in Forex training if you’re serious about making money.

* Keep a cool head. Just like in poker, Forex trading requires a calm personality. Don’t let emotions get the better of you, especially after you have suffered a loss. The best advice is to take a step away from the market, before you go back to gambling.

* Only risk 2 – 3% of your total balance on each Forex trade. This way, you won’t end up losing it all in one go.

* Read the papers. Forex exchange is all about what is happening in the world. Read up on current affairs at home and abroad so you can spot trends and make informed judgments about where the dollar is headed next.

* Look ahead – you can choose to trade in different time windows – hourly, daily or weekly. Always look at the bigger picture before you invest.

* Stick to one pair. Forex trading is about speculating on pairs of currencies, and how they affect each other. If you stick with one pair, you will learn the trends and get a feel for them, which is likely to make you more successful than picking a different currency each time.

* Trading is stressful. Accept that once you’ve made a trade, the result is out of your hands. There’s nothing you can do now. Don’t blame others if you lose – markets go up and down and you take the risk when you enter the Forex exchange. This is also what gives Forex gambling the adrenalin rush that so many people seek.

Forex - Euro falls vs dollar on Mersch

2008-01-16T10:19:00.000-08:00

The euro dropped against the dollar on Wednesday after European Central Bank governing council member Yves Mersch told Bloomberg News the central bank may revise down its euro zone growth forecasts for 2008.

"ECB's Mersch is throwing a spanner into the EUR market, highlighting the downside risks to growth and suggesting ECB needs to be flexible with regard to fighting inflation," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey. "His comments sent EUR/USD down to the overnight lows, which have just broken leading to follow-through selling."

The euro last traded down 1 percent to $1.4662, close to the session low of $1.4645. The euro fell 0.6 percent against the yen to 157.03 .

Dollar/yen rose 0.3 percent to 107.12 . (Reporting by Nick Olivari and Gertrude Chavez-Dreyfuss, Editing by Chizu Nomiyama,)

U.S. Forex Market Commentary

2008-01-16T06:15:00.000-08:00

EURO

The euro moved lower vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.4760 level and was capped around the $1.4815 level. Technically, today’s intraday low was just above the 61.8% retracement of the move from $1.4825 to $1.4640. Data released in the U.S. today saw the November trade deficit expand 9.3% to US$ 63.1 billion, its highest level in fourteen months, while the December import price index grew 0% m/m and 10.9% y/y. There is a little market chatter that suggests the FOMC may ease rates by 75bps on 30 January but this is unlikely. Most traders expect the Fed will cut rates by 25bps or 50bps at the end of the month, especially after Chairman Bernanke said the Fed is ready to take “substantive” action. Traders are also talking about a report that Merrill Lynch may announce a larger-than-expected write-down next week for Q4 earnings related to its sub-prime exposure. Also, traders noted Bank of America is purchasing Countrywide – the beleaguered home lending giant – for US$ 4.1 billion in stock. In eurozone news, traders are still talking about the very hawkish comments made by European Central Bank President Trichet yesterday wherein he said the ECB will tighten rates “preemptively” if needed. Euro bids are cited around the US$ 1.4705/ 1.4625 levels.

JPY / CNY

The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥108.65 level and was capped around the ¥109.70 level. Technically, today’s intraday low was right around the 61.8% retracement of the move from ¥107.85 to ¥110.10. Bank of Japan Governor Fukui spoke overnight and said weaker housing activity will lead to a weaker economic “for the time being.” Japanese interest rate futures are actually pricing in a 6bps cut in rates over the next twelve months whereas most traders believe the BoJ’s next move in rates is up from the current 0.50% level of the overnight call rate. Data released in Japan overnight saw the December economy watchers’ survey worsen for the ninth consecutive month with the current conditions index declining to 36.6 – its lowest level since January 2003. Also, bank lending by Japanese banks rose 0.2% y/y in December, the smallest rise in nearly two years. The Nikkei 225 stock index lost 1.93% to close at ¥14,110.79. Dollar bids are cited around the ¥108.40 level. The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥160.65 level and was capped around the ¥162.25 level. The British pound and Swiss franc weakened vis-à-vis the yen as the crosses tested bids around the ¥212.00 and ¥98.55 levels, respectively. The Chinese yuan appreciated sharply vis-à-vis the U.S. dollar as the greenback closed at CNY 7.2620 in the over-the-counter market, down from CNY 7.2719. PBoC announced China’s foreign reserves topped US$ 1.53 trillion at the end of 2007. It was also reported that China’s trade surplus at the end of 2007 was US$ 262.2 billion, up from US$ 177.47 billion at the end of 2006.

STERLING

The British pound weakened vis-à-vis the U.S. dollar today as cable tested bids around the US$ 1.9480 level and was capped around the $1.9635 level. Cable weakened today to its weakest level since 20 March 2007. Data released in the U.K. today saw November industrial production fall 0.1% m/m – below expectations – while manufacturing output was also off 0.1% m/m. These prints incited talk that the manufacturing sector may be headed into recession. Also, the FT reported December house price growth reached its slowest pace since July 2005 in England and Wales. Cable bids are cited around the US$ 1.9260 level. The euro gained marginal ground vis-à-vis the British pound as the single currency tested offers around the ₤0.7585 level and was supported around the ₤0.7535 level.

SWISS

The Swiss franc appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the CHF 1.0975 level and was capped around the CHF 1.1050 level. The pair reached its lowest level since 27 November. U.S. dollar offers are cited around the CHF 1.1125 level. The euro and British pound fell vis-à-vis the Swiss franc as the crosses tested bids around the CHF 1.6245 and CHF 2.1420 levels, respectively.

Retaled Link :
Forex reserve tops $1.53 trillion
Forex Trading Education - The London Open Checklist

Forex - Dollar falls on weak U.S. retail sales

2008-01-15T22:52:00.000-08:00

The dollar extended its declines against the euro and yen on Tuesday after data showed U.S. retail sales for December were below market expectations.

The euro gained against the dollar to $1.4900 from $1.4885 before the data. Against the yen, the dollar extended losses to 107.04 yen , from 107.55 just before. Dollar/yen is now at its lowest since June 2005.

U.S. retail sales fell 0.4 percent last month while markets were expecting no change from November.

Retaled Link :
Forex reserve tops $1.53 trillion
Forex Trading Education - The London Open Checklist

Forex reserve tops $1.53 trillion

2008-01-12T10:51:00.000-08:00

China's foreign exchange reserve had reached US$1.53 trillion by the end of 2007, up 43.32 percent from 2006, the People's Bank of China announced on Friday.

A total of US$461.9 billion were added to the country's forex reserve in 2007, said the central bank.

In December alone, the forex reserve rose by US$31.3 billion.

China's forex reserve kept a sharp growth in 2007, reaching US$1.2 trillion by the end of March, US$1.33 trillion by the end of June, and US$1.43 trillion by the end of September.

China's soaring trade surplus is the major contributing factor to the forex reserve boom.

Data newly released by the General Administration of Customs show that China's trade surplus surged to a record US$262.2 billion in 2007, representing a 47.7 percent growth over a year earlier.

The huge forex reserve is considered the main reason for excess liquidity in China, as the central bank has to spend quantities of basic money to purchase foreign exchange, thus aggravating the problem of surplus fluidity.

By the end of 2007, the M2 -- a broad measure of money supply, which indicates the monetary demand of the whole of country and possible inflation -- grew by 16.72 percent from a year ago to 40.34 trillion yuan.

The growth rate is 0.22 percentage points lower than the end of 2006, but still higher than the target growth of 16 percent set by the central bank at the beginning of 2007.

A total amount of 330.3 billion yuan was poured into the market in 2007, 26.2 billion yuan more than 2006.

On the other hand, continuous growth of the forex reserve has in fact increased the pressure on appreciation of the Chinese currency, which in turn has exerted greater pressure on value preservation of China's forex reserve.

Value of Chinese RMB against the US dollars has appreciated by over six percent in 2007. The central parity rate of the RMB was 7.2672 to the US dollar on Friday.

In a move to make better use of the country's huge forex reserve, China established the China Investment Corporate Ltd (CIC), the country's State forex investment company in 2007.

The State-owned investment company will invest in overseas financial markets.

The registered capital of US$200 billion of the CIC all comes from the forex reserve of the country, which have poured into the company so far.

Forex Trading Education - The London Open Checklist

2007-12-31T06:13:00.000-08:00

Forex signal service provides price action that set off market entry, exit, or any other intra-trade adjustment on the basis of technical indicators. Forex signal service providers are either brokers or professional traders or some market analysts.

It is always advisable to subscribe to one of such forex signal services, as you need not to spend time in monitoring the market round the clock. Forex trading signal providers help you in minimizing risks or losses in trading. But it is important that you understand the logic behind the signals. Then only you will be able to take the complete advantage of such signaling services.

There are forex signal service providers who offer their assistance in return of a small subscription. Many automated forex trading platform however offer free signal services to their customers. The purpose of the forex trading signals is to make informed decision for the trading. A mix and match of various signals provides a full proof trading strategy to gauge the right direction of the market.

The Forex signals service providers analyze several factors responsible for the movement of the market. The signals indicate the buying and selling time of the different currencies which are traded in the forex market. The signals are calculated and generated by using different indicators such as trends, moving average, Elliott waves, Bollinger bands, Fibonacci series, etc.

Forex signal service providers send you alerts when the conditions are right for the trade. They use cutting-edge technology based software, which constantly monitor all major currency pairs for generating technical indicators.

These forex signal service providers use historical data to match current chart patterns with old ones. Therefore you can judge the quality of service of the forex signal service providers by judging their past performances. The forex signal service providers must have proven track records of recommendations, which turned out to be true.

Some forex signal service providers specifically generate services for advanced or experienced traders and others are for new or intermediate investors and traders. To take the full advantage of the forex signal service, you should have a basic knowledge of the forex market.

Time frame for which the forex trading signals are generated is equally important. Few trading signals can be valid only for a few minutes or an hour; others may have recommendations that are valid for a day or more. If the forex trading signal providers generate signals for shorter time frame, you need to monitor the market frequently.

Some forex signal service providers offer add-on services like email or mobile alerts. The service provider should have end-to-end technical support for the customers. Some other factors, which you need to check before choosing a forex signal service provider are

Spread: Some forex signals providers do not include spread in their recommendations, which affects the performance of the trading system negatively. So find out the average number of positions performed per month on all currencies to guess the real profit.

Back testing results: Some forex signals providers may display only back testing result of their system performance that may show positive result. But this does ensure that the system will run in real time with same efficiency.

FOREX (Foreign Exchange Market)

2007-12-31T06:11:00.000-08:00

FOREX (Foreign Exchange Market) is a global currency market that exchanges currency from one country to the currency of another at a changing rate, subject to the date of exchange.

FOREX is a virtual network of currency dealers connected among themselves by means of telecommunications. FOREX currency dealers are connected to leading world financial centres, and round the clock workers. As a result, FOREX forms a
united and very efficient system.

The foreign exchange market owes its existence to the 1971 abandonment of the Bretton Woods accord and the subsequent unwinding of the regime of universal fixed exchange rates.

The history of stock exchanges can be traced to 12th century France, when the first brokers are believed to have developed, trading in debt and government securities. Unofficial stock markets existed across Europe through the 1600s, where brokers would meet outside or in coffee houses to make trades. The Amsterdam Stock Exchange, created in 1602, became the first official stock exchange when it began trading shares of the Dutch East India Company. These were the first company shares ever issued.

The main participants of a foreign exchange market are:
Commercial banks
Exchange markets
Central banks
Firms that conduct foreign trade transactions
Investment funds
Broker companies
Private persons

Access to foreign exchange (forex), the most extensive market on the planet, is generally through an intermediary known as a forex broker. Similar to a stock broker, these agents can also provide advice on forex trading strategies. This advice to clients often extends to technical analysis and research approaches designed to improve client forex trading performance.
Any company that conducts its business in another currency is exposed to currency risk (or foreign exchange risk, or exchange rate risk). However, this risk is present only if the company's sales currency differs from the company's cost currency – if a company's revenues and expenses are both denominated in the same foreign currency, there is no foreign exchange risk.
The most important forex market is the spot market as it has the largest volume. The market is called the spot market because trades are settled "immediately" or on the spot. In practice this means within two banking days.

There are some other types of Forex along with spot-market: swap contracts, forwards and futures. These called derivatives. Derivatives are powerful tools that can be used to hedge the risks normally associated with production, commerce and finance. Derivatives facilitate risk management by allowing a person to reduce his exposure to certain kinds of risk by transferring those risks to another person that is more willing and able to bear such risks.
But Forex offers a number of advantages over other types of forex trading, including:

Powerful forex leverage
Zero forex commissions
Limited risk
Guaranteed prices and Instantaneous Fills
24-hour market
As every successful Forex trader knows, it is not enough just to have the technical knowhow of the actual mechanics of trading the Forex (foreign currency exchange) market, but to recognise that to be a winner relies also on the psychology of trading.

A forex currency trade is the simultaneous buying of one currency and selling of another one. The currency combination used in the trade is called a cross (for example, the Euro/US Dollar, or the GB Pound/Japanese Yen.). The most commonly traded currencies are the so-called "majors" - EURUSD, USDJPY, USDCHF and GBPUSD.

Currencies are traded in dollar amounts called a "lot". One lot is equal to $1,000, which controls $100,000 in currency. This is what is known as the "margin". You can control $100,000 worth of currency for only 1,000 dollars. This is what is called High Leverage.

Currencies are always traded in pairs in the FOREX. The pairs have a unique notation that expresses what currencies are being traded. The symbol for a currency pair will always be in the form ABC/DEF. ABC/DEF is not a real currency pair, it is an example of a symbol for a currency pair. In this example ABC is the symbol for one countries currency and DEF is the symbol for another countries currency.

We know that the FX market is the largest in the world and that your broker or institution that you are trading with is collecting quotes from a centralized feed or individual quotes comprising of interbank rates.
So how are these quotes made up? Well, as we previously mentioned currencies are traded in pairs and are each assigned a symbol. For the Japanese Yen it is JPY, for the Pounds Sterling it is GBP, for Euro it is EUR and for the Swiss Frank it is CHF. So, EUR/USD would be Euro-Dollar pair. GBP/USD would be pounds Sterling-Dollar pair and USD/CHF would be Dollar-Swiss Franc pair and so on.
You will always see the USD quoted first with few exceptions such as Pounds Sterling, Euro Dollar, Australia Dollar and New Zealand Dollar. The first currency quoted is called the base currency. Have a look below for some example.
When you see FX quotes you will actually see two numbers. The first number is called the BID and the second number is called the offer (sometimes called the ASK).

When we trade currencies we open or close short or long position. A short position is where we have a greater outflow than inflow of a given currency. In FX short positions arise when the amount of a given currency sold is greater than the amount purchased. A long position is where we have greater inflows than outflows of a given currency. In FX long positions arise when the amount of a given currency purchased is greater than the amount sold.
Forex trading strategy begins with fundamental and technical analysis.
Fundamental analysis refers to political and economic conditions that may affect currency prices. FOREX traders using fundamental analysis rely on news reports to gather information about unemployment rates, economic policies, inflation, and growth rates.

Fundamental analysis is often used to get an overview of currency movements and to provide a broad picture of economic conditions affecting a specific currency. Most traders rely on technical analysis for plotting entry and exit points into the market and supplement their findings with fundamental analysis.
Currency prices on the FOREX are affected by the forces of supply and demand, which in turn are affected by economic conditions. The two most important economic factors affecting supply and demand are interest rates and the strength of the economy. The strength of the economy is affected by the Gross Domestic Product (GDP), foreign investment and trade balance.
Economic indicators are reports released by the government or a private organization that detail a country's economic performance. Economic reports are the means by which a country's economic health is directly measured, but do remember that a great deal of factors and policies will affect a nation's economic performance.
These reports are released at scheduled times, providing the market with an indication of whether a nation's economy has improved or declined. The effects of these reports are comparable to how earnings reports, SEC filings and other releases may affect securities. In forex, as in the stock market, any deviation from the norm can cause large price and volume movements.
Central banks as Forex participants play a great role in the economy of every country. Central bank is the principal monetary authority of a nation, controlled by the national government. It is responsible for issuing currency, setting monetary policy, interest rates, exchange rate policy and the regulation and supervision of the private banking sector. The Federal Reserve is the central bank of the United States. Others include the European Central Bank, Bank of England, and the Bank of Japan.
Other type of analysis is technical analysis. A technical analysis is founded on three suppositions:
Movement of the market considers everything
Movement of prices is purposeful
History repeats itself
That is, technical analysis is a statistical and mathematical analysis of previous quotes and a prognosis of coming prices. A number of technical indicators have been installed into the PRO-CHARTS trading system. Analyzing the indicators one can come to the conclusion about further movements of the quoted currencies.
Categories of the technical analysis theory:
Indicators (Oscillators, eg: Relative Strength Index RSI)
Number theory (Fibonacci numbers, Gann numbers)
Waves (Elliot wave theory)
Gaps (High-Low, Open-Closing)
Trends (Following Moving Average)

Forex Market Snapshot

2007-12-24T05:52:00.001-08:00

Introduction

The following facts and figures relate to the foreign exchange market. Much of the information is drawn from the preliminary results of the 2007 Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity conducted by the Bank for International Settlements (BIS) in April 2007 and released on September 25, 2007. 54 central banks and monetary authorities participated in the survey, collecting information from approximately 1280 market participants.

"The 2007 survey shows an unprecedented rise in activity in traditional foreign exchange markets compared to 2004. Average daily turnover rose to $3.2 trillion in April 2007, an increase of 71% at current exchange rates and 65% at constant exchange rates. Against the background of low levels of financial market volatility and risk aversion, market participants point to a significant expansion in the activity of investor groups including hedge funds, which was partly facilitated by substantial growth in the use of prime brokerage, and retail investors. A marked increase in the levels of technical trading – most notably algorithmic trading – is also likely to have boosted turnover in the spot market." - BIS

Structure

* Decentralised 'interbank' market
* Main participants: Central Banks, commercial and investment banks, hedge funds, corporations & private speculators
* The free-floating currency system began in the early 1970's and was officially ratified in 1978
* Online trading began in the mid to late 1990's

Trading Hours

* 24 hour market
* Sunday 5pm EST through Friday 4pm EST.
* Trading begins in New Zealand, followed by Australia, Asia, the Middle East, Europe, and America

Size

* Largest financial market in the world
* $3.2 trillion average daily turnover, equivalent to:

o More than 10 times the average daily turnover of global equity markets1
o More than 35 times the average daily turnover of the NYSE2
o Nearly $500 a day for every man, woman, and child on earth3
o An annual turnover more than 10 times world GDP4

* The spot market accounts for just under one-third of daily turnover

1. About $280 billion - World Federation of Exchanges aggregate 2006
2. About $87 billion - World Federation of Exchanges 2006
3. Based on world population of 6.6 billion - US Census Bureau
4. About $48 trillion - World Bank 2006.

Major Markets

* The US & UK markets account for just over 50% of turnover
* Major markets: London, New York, Tokyo
* Trading activity is heaviest when major markets overlap5
* Nearly two-thirds of NY activity occurs in the morning hours while European markets are open6

5. The Foreign Exchange Market in the United States - NY Federal Reserve
6. The Foreign Exchange Market in the United States - NY Federal Reserve

Forex Trading Course Rating and Reviews

2007-12-24T05:48:00.000-08:00

ForexTradingCourses.net offers free, informative, straight-to-the-point reviews on Forex Trading courses.In the past few years as more and more individual traders have taken to trading forex , the education industry has also exploded. There are many courses , seminars and ebooks available in the market. Some are informative and others totally useless. The purpose of the website has been to list courses which provide value and actionable data to traders.All Courses have been Rated on 4 parameters.

Quality of content ,
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FII unloading trips forex flow; reserves decrease by $599 mn

2007-12-21T22:26:00.000-08:00

There is a slowdown in the pile up of India’s foreign exchange reserves on the back of unloading of portfolios by foreign institutional investors. During the first 11 months of this calendar year, foreign exchange reserves rose as a combination of foreign portfolio, private equity, FDI and commercial borrowings augmented the flow of capital into the country. During this period, forex reserves grew by $97 billion.

But over the last few weeks, there has been a dip in reserves owing to selling by foreign portfolio investors and also on account of valuation. According to the figures released by RBI in its weekly statistical supplement (WSS), foreign exchange reserves, including gold and SDR, dipped $599 million during the week ended December 14 to $272.9 billion.

While foreign currency assets and the reserves with IMF dipped $596 million and $3 million, respectively, the value of gold and special drawing rights (SDR) remained unchanged during the week. During the last fortnight, banks also did not see much of growth in deposits. Yet, the annual money supply growth is way above the central bank’s comfort level of 17 to 17.5% at 21.4%.

Aggregate deposits mobilised by scheduled commercial banks rose by only Rs 4,697 crore in the latest fortnight ending December 2007. Deposits touched Rs 29,29,004 crore as on December 2007. While demand deposits dipped Rs 15,307 crore, term deposits rose Rs 20,003 crore. Bank loans rose by higher amount during the fortnight, during which total loans rose Rs 16,507 crore to Rs 20,91,400 crore. Food credit and non-food credit rose by Rs 1,512 crore and Rs 14,995 crore, respectively.

But banks have offloaded their stock of government bonds substantially. Their investments in government and other approved securities dipped Rs 8,595 crore to touch Rs 9,55,941 crore.

As per the updated money supply figures, the total stock of money in the system amounted to Rs 36,82,402 crore as on December 2007, up Rs 6,308 crore over the previous fortnight’s levels. While currency with the public and term deposits rose Rs 4,485 crore and Rs 17,579 crore, respectively, demand deposits with banks dipped Rs 15,710 crore. At current levels, the annual growth in money supply (year on year) is still higher at 21.4% compared with the central bank’s comfort level of 17 to 17.5%.

However, ever since the central bank hiked the cash reserves requirements, asking banks to keep aside a portion of their deposits to be parked with RBI in its October monetary policy, the money supply growth has some what slowed down.

Also, many commercial banks have reduced interest rates on deposits, which have impacted deposit growth and in turn, the money supply growth as well. Besides, capital inflows too have slowed down, which in turn have helped contain the money supply growth as the central bank, which mops up these inflows, has to infuse lesser rupee funds.

In other developments, RBI has not resorted to the ways and means advances (WMA) — a temporary overdraft to meet its revenue mismatches — for yet another week. But at the same time, it has parked its surplus revenue amounting to Rs 3,146 crore during the week. State governments, on the other hand, have reduced their WMA balances by Rs 79 crore to Rs 173crore.

Forex Define

2007-12-21T22:25:00.000-08:00

FOREX.com is a division of GAIN Capital Group, a dedicated partner to professional FX traders and fund managers worldwide. Institutional services include IB programs, white label solutions, and asset management. Individual forex traders can take advantage of the market expertise and financial strength of GAIN Capital Group and access an institutional FX trading platform, FOREXTrader, along with our powerful real-time forex charts, professional forex market research, and suite of advanced forex trading tools. For traders new to the currency trading, FOREX.com offers forex training programs, forex minis, and information about trading the foreign currency market.

How do I get started in FOREX?

2007-12-21T22:24:00.001-08:00

Do you see the profit potential in trading currencies, but learning to trade just seems too daunting? Have you watched with excitement the recent crashing of the value of the USD, but simply don’t know how to get started trading?

While it is simple to begin trading Forex online, maintaining profitability in the long term is no easy task. You have probably heard that 90% of Forex traders lose their money in the long term. If indeed this is true, it is the result of a couple of different factors.

1. Overtrading: Each trade costs you a couple of pips—Consider your trades well before you make them. Each faulty trade, even if exited quickly, drains equity.
2. Bad money management: One bad trade can wipe out a year of patient, smart trading. Manage your risk using stop loss orders, so that you never risk too high a percentage of your equity on any one single trade.
3. Lack of knowledge: If you have never traded Forex before, educate yourself! Successful traders are not born that way. The difference between success and failure in the Forex market depends in no small part on the knowledge and education of a trader. For the beginning trader, a proper education is essential before investing in the Foreign Exchange. Find a program you are comfortable with, and begin practicing on a demo account.

Trading on the foreign exchange offers unparalleled opportunities for profit, but it is also extremely risky. Make sure you know what you are getting into before you start trading, and start trading only when you are comfortable in your knowledge and ability.