Metatrader system
The past few weeks have been some of the most challenging I have seen in my 25 years working on Wall Street. Not surprisingly, the bad news and volatility that’s been occurring in the credit and financial markets has also spilt into the foreign exchange (forex) markets as well – and we’re seeing significant volatility across currency pairs, particularly where the US Dollar is involved.
Here’s proof. Looking at the daily price movement in EUR/USD from 5 PM NY to 5 PM NY time, we have, over a number of years, calculated the average daily price moment of the currency pair in a day Until this month the highest price movement differential was 1.55 per cent reached in September 2000. On average, the daily movement in price of the EUR/USD tends to average 1 per cent a day. but in the last few years we have had less volatility with narrower daily movements; in 2005 it was as low as 0.87 per cent, in 2006 – 0.73 per cent; 2007 – 0.60 per cent and year to date for 2008 - 0.98 per cent. However, looking at the month of September the average has significantly increased to 1.67 per cent (as at end of September 08), and up even more to 1.88% as of Oct 13, a marked difference from its average, and a reflection of the high volatility in the forex market currently.
But of course, with greater volatility comes better trading opportunities. Not only does volatility create wider spreads, but also more spikes in the market; enabling investors to make a decision on the future direction of a currency pair. But it also means higher risk, which makes it more important than ever to be well prepared before you start trading. For example, when you enter a trade you should have pre-set expectations for where you think the market will go (profit levels) and where you will get out if you are wrong (stop loss).
The extreme conditions in the credit markets are creating an inverted yield cure (where short term rates are higher than long term rates) in the US for the first time since the 1970s and from a forex perspective, this means you will see massive swings in the day-to-day roll rates on your Forex trades. The ‘Daily roll’ rate is the interest rate you earn or pay each day when you hold a currency overnight.
In short, volatility brings market movements, which brings the opportunity not only for returns, but for losses as well. So it’s vitally important you plan your trades carefully and understand the impact the activity in the wider market is having on the forex market. Forewarned is fore-armed after all.
Sabtu, 29 Agustus 2009
Kamis, 27 Agustus 2009
Published 21 hours ago from FOREX Ltd Company - http://forexltd.co.uk
CHF
The pre-planned break-out variant for buyers has been implemented and the perspectives of the attainment of estimated targets are supported by relatively high bullish activity level marked by OsMA trend indicator at the break of key resistance level. At the moment, considering descending direction of indicator chart we can assume probability of rate return to close 1,0640/60 supports where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of shorter time interval. As for buying positions on condition of formation of topping signals the targets will be 1,0700/20 and (or) further break-out variant up to 1,0760/80, 1,0820/40, 1,0880/1,0920. The alternative for sales will be below 1,0600 with the targets of 1,0540/60, 1,0480/1,0500.
GBP
The pre-planned break-out variant for sales has been implemented with overlap of minimal estimated target. OsMA trend indicator, having marked preservation of relatively low both parties activity, as it was before does not clarify the choice of planning priorities for today. Therefore, considering suppositions about the preservation of current rate movement tendency, we can assume probability of rate return to close 1,6240/60 resistance levels where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of shorter time interval. As for short-term sales on condition of the formation of topping signals the targets will be 1,6180/1,6200, 1,6140/60 and (or) further break-out variant up to 1,6080/1,6100, 1,6020/40, 1,5980/1,6000. The alternative for buyers will be above 1,6360 with the targets of 1,6400/20, 1,6460/80, 1,6520/40.
JPY
The estimated test of key supports has been confirmed but relatively high bearish activity level, marked by OsMA trend indicator is not the positive signal for the implementation of pre-planned buying positions. Therefore, at the moment, without clarifying the choice of planning priorities, nevertheless, we can assume probability of rate movement within trend line «1» and «2» borders. After their achievement it is recommended to plan trade operations within the channel. The alternative break-out variant for buyers will be above 94,60 with the targets of 95,00/20, 95,40/60. As for sales the break-out variant will be below 93,00 with the targets of 92,40/60, 91,80/92,00.
EUR
The pre-planned test of key supports has been confirmed, but relative sales activity rise marked by OsMA trend indicator did not incline for the implementation of pre-planned buying positions. At the moment, considering sign of bearish development incompleteness as well as ascending direction of indicator chart we can assume probability of rate correction within Ichimoku cloud borders to 1,4280/1,4300 levels, where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of shorter time interval. As for short-term sales on condition of the formation of topping signals the targets will be 1,4220/40, 1,4180/1,4200 and (or) further break-out variant up to 1,4120/40, 1,4060/80, 1,4000/20. The alternative variant for buyers will be above 1,4320 with the targets of 1,4360/80, 1,4420/40.
CHF
The pre-planned break-out variant for buyers has been implemented and the perspectives of the attainment of estimated targets are supported by relatively high bullish activity level marked by OsMA trend indicator at the break of key resistance level. At the moment, considering descending direction of indicator chart we can assume probability of rate return to close 1,0640/60 supports where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of shorter time interval. As for buying positions on condition of formation of topping signals the targets will be 1,0700/20 and (or) further break-out variant up to 1,0760/80, 1,0820/40, 1,0880/1,0920. The alternative for sales will be below 1,0600 with the targets of 1,0540/60, 1,0480/1,0500.
GBP
The pre-planned break-out variant for sales has been implemented with overlap of minimal estimated target. OsMA trend indicator, having marked preservation of relatively low both parties activity, as it was before does not clarify the choice of planning priorities for today. Therefore, considering suppositions about the preservation of current rate movement tendency, we can assume probability of rate return to close 1,6240/60 resistance levels where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of shorter time interval. As for short-term sales on condition of the formation of topping signals the targets will be 1,6180/1,6200, 1,6140/60 and (or) further break-out variant up to 1,6080/1,6100, 1,6020/40, 1,5980/1,6000. The alternative for buyers will be above 1,6360 with the targets of 1,6400/20, 1,6460/80, 1,6520/40.
JPY
The estimated test of key supports has been confirmed but relatively high bearish activity level, marked by OsMA trend indicator is not the positive signal for the implementation of pre-planned buying positions. Therefore, at the moment, without clarifying the choice of planning priorities, nevertheless, we can assume probability of rate movement within trend line «1» and «2» borders. After their achievement it is recommended to plan trade operations within the channel. The alternative break-out variant for buyers will be above 94,60 with the targets of 95,00/20, 95,40/60. As for sales the break-out variant will be below 93,00 with the targets of 92,40/60, 91,80/92,00.
EUR
The pre-planned test of key supports has been confirmed, but relative sales activity rise marked by OsMA trend indicator did not incline for the implementation of pre-planned buying positions. At the moment, considering sign of bearish development incompleteness as well as ascending direction of indicator chart we can assume probability of rate correction within Ichimoku cloud borders to 1,4280/1,4300 levels, where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of shorter time interval. As for short-term sales on condition of the formation of topping signals the targets will be 1,4220/40, 1,4180/1,4200 and (or) further break-out variant up to 1,4120/40, 1,4060/80, 1,4000/20. The alternative variant for buyers will be above 1,4320 with the targets of 1,4360/80, 1,4420/40.
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Minggu, 23 Agustus 2009
How Forex Trading Works..
Currency trading is mainly about buy and sell activities. Currencies are traded on a price interest point (normally called pip) system. Every currency pair has their own pip value. The objective of a trader is to hold as many profitable pips as possible. Some pip values are fixed, but some can fluctuate depends on the currency gain or loses strength. Normally I trade by using margin trading, where small deposit is required to control much larger amount in the market. Here I will use 1 percent margin deposit so that $1000 control $100,000 of trade currency. $100,000 is the notional amount. Let me shows some major currency pair with the currency exchange rate and the pip values.
| Currency | Currency exchange rate | Pip Value |
| (GBP/USD) | 1.7204 | $10.00 per pip (fixed) |
| (EUR/USD) | 1.1789 | $10.00 per pip (fixed) |
| (USD/CAD) | 1.1642 | $8.59 per pip (fluctuating) |
| (USD/JPY) | 117.82 | $8.49 per pip (fluctuating) |
For GBP/USD, 1 pip movement can be from 1.7203 to 1.7204. That means from 1.7102 to 1.7202, it should be 100 pip movement. Lets look for another example, USD/JPY, 1 pip movement is from 117.82 to 117.83 and 100 pips movement is from 117.83 to 118.83.
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