Month: October 2010

By Cedric Welsch – When we use the word parity, we are referring to something that is equal to some other thing. When referring to a Canadian dollar parity forecast therefore, we mean parity between the Canadian currency and the US dollar. We will briefly discuss the various factors that play a role when we prepare such a forecast.

The US dollar has been in a declining phase for a number of years now. We can attribute this to a variety of factors. A major reason is certainly the lackluster performance of the US economy and the lack of trust in its ability to bounce back in a short time. As the dollar continued to decline, an increasing number of investors started to lose faith in this currency, switching to the Euro and other currencies that performed better.

The Canadian dollar has been worth less than a US dollar for many years. As the US dollar went into long term decline, its Canadian counterpart began to appreciate against it in a remarkable way. The stable economy and good long term prospects in Canada of course helped a lot in this regard.

There are therefore more and more economists that nowadays predict that the Canadian and US currencies will soon reach parity. There are some optimistic experts predicting this will occur within the next few months. Others are a little more cautious in their approach and they predict it to happen in less than a year from now.

Economists use mainly 2 approaches when they attempt to make a Canadian dollar parity forecast. These are the technical approach and the fundamental approach. We will briefly look at both.

The technical approach is more often than not applied for short-term forecasting. It’s very popular with fund managers who have to make reasonably short term investment decisions. This model makes use of indicators such as trading volumes, moving averages, etc.

The fundamental approach encompasses the use of what is referred to as fundamental indicators in the industry. Economists following this approach will therefore use factors such as inflation, GDP and unemployment when drawing up their predictions. This approach is generally more useful when one tries to make long term predictions of a currency’s value.

It’s still widely debated how long it’s going to take before the US and Canadian currencies reach parity. There are, however, not many economists who predict this won’t happen. A Canadian dollar parity forecast is a very real possibility – most economists only differ about the time frame.

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Do you want to really make profits with forex? Make sure you get fresh updates ahead of everybody else here: Forex News

Also, you need to know how to read and analyze the trading market well. Learn Currency Trading News

By Jared Ingram – The online forex trading market is so far the world’s biggest financial market but its accessibility is sometimes limited to a regular trader. If you are familiar with forex trading, you know that the business is not done in a regulated exchange market so there are some risks linked with trading in the forex market.

For the past years, forex currencies are only accessed by banks, major currency dealers and hedge funds. Sometimes, a person with high net assets can have access. However, small-time financial organizations want a share of this big pie. They know that forex trading has a lot of advantages compare to other financial markets. In fact, some of these benefits include its remarkable liquidity, accessibility for 24 hours at 5 and 1/2 days per week, and a strong trend of forex rates.

Because of this vision of entrepreneurialism by small-scale financial organizations and the advancement of Internet, forex trading market is now easily reached online and at retail stage. These organizations utilize the easy access to Internet and some efficient and software programs that usually provide precise pricing, charting capabilities, news feeds and technical indicators that permits any interested investor to trade foreign currencies. In fact, between 2002 and 2005, the number of investors in forex trading has increased three times and this number continues to grow as of the moment.

Perhaps, you already know few of the benefits that the forex trading market can offer. It is in fact the biggest, fastest and most liquid market existing in the world and these are just some of its great benefits. A basic explanation about this market is that it is the real-time buying and selling of currencies where the main goal is to gain a profit or accrue a loss.

As mentioned, the forex market is available 24 hours per day at 5.5 days per week which is an advantage. Since the clearing of trades is decentralized and there is overlapping with the chief financial markets around the world, the forex trading market is kept open such that trading volume is created all over the whole day and night. Liquidity may also be greatly reduced after trading hours or when majority of trading participants decide to put a limit on their trading or move on to more popular markets.

Also, another benefit, when trading in forex market, is the fact that it is a very liquid market. Since currency is the foundation of all commerce in the world, activities involving currency exchange are steady. The liquidity, specifically in the majors, hardly dries up even if times are “slow.” It is also an advantage to the trader that they can trade currencies even if the leverage is up to 100:1. Although, very high leverage can result to big losses, big gains are also possible.

Nowadays, almost any one who are risk takers and have a good understanding and analysis of the trends in the forex market can try their skills and luck in online currency trading. There are so many benefits of doing business in the online forex trading market if you are going to compare it with other kinds of financial markets.

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Are you looking for more information regarding online forex trading market? Visit http://www.globalonlineforextrading.com/ today!

By Taro Hideyoshi – The Stochastic Oscillator is an overbought/oversold indicator developed by Dr. George Lane. The stochastic is a common indicator that is integrated into every charting software including MetaStock.

Put simply, the Stochastic Indicator (SI) is a price oscillator which compares today’s price to its price range over a specific period of time. For example a 14-day SI, compares a derivative of today’s price with price 14 trading days ago. We will not go deep to the actual calculation here. Believe me! you will be glad that we do not.

In an uptrend, the price usually moves to the upper end of the recent price range. In a downtrend, the price sinks to the bottom of the range.

Stochastic Indicator is displayed in two lines; the major line is called %K (usually displayed in solid) and the %D (usually displayed in dotted line) as a 3-day moving average of %K.

There are two forms of stochastic, fast stochastic and slow stochastic. The one mentioned earlier is fast stochastic. The slow stochastic is a smoothed version of fast stochastic. It usually moves more gradually.

According to the strong correlation between tops and bottoms in price and SI tops and bottoms, the SI, therefore, is a powerful indicator and used-widely in short-term trading or day trading.

How to apply Stochastic Indicator in Trading?

Whether fast or slow and whether period you use, the important buy/sell signals from stochastic are as follows.

1. The SI around 75% to 80% indicates that a top is imminent (overbought).
2. The SI around 25% to 20% is often an imminent sigh of a bottom (oversold).
3. Buy when SI is in oversold zone and the faster %K line crossed above the slower %D line.
4. Sell when SI is in overbought zone and the %K crosses the %D to the downside.
5. Look for divergences, it tells you that the price is going to reverse. If price makes a new high and at the same time that the stochastic makes lower high. This is called a “bearish divergence”. The “bullish divergence” is when the price makes a new low while the stochastic makes higher low.

Many traders use stochastic indicator as stand-alone system. Although there is nothing wrong with this approach. I would suggest you to use it with others indicators or chart patterns to confirm the signal.

Every indicator and method has its pros and cons. Use it to support each others. Do not take unnecessary risks; watch out for signals from your trading system. If all indicators are in gear, it is the stronger and safer signal for you to enter a trade.

About the Author

Taro is an experience trader who trades in stocks, futures, forex. He strongly focuses on technical analysis, trading systems and money management.

If you would like to find more articles on MetaStock Tutorials, MetaStock Formulas, Trading Systems and Money Management. Please go to MetaStock Trading System.

By ProIndicators – One needs to give importance when it comes to choosing a forex indicator. Different indicators give you different analysis and that is why you have to choose the one that gives the best possible analysis and an accurate one. Hence, when choosing a forex indictor one needs to be careful. Sometimes, the analysis of prices with forex indictor might just give you duplicate rather than confirming the information. Therefore, an indictor chosen should supplement each other rather than compliment. The way one can overcome this potential problem is to check on the type on indicator that you have chosen for your analysis.

There are different indicators for different purposes and each one gives you different story. Trend indicators, volume indicators, momentum indicators, volatility indicators, magnitude indicators are the most common indicators with forex trading. All of these forex indicators perform different functions and can be used for different analysis. The function of trend indicators is to measure a trend in the prices. Volume indicators check on the strong and weak trends and confirm them. Momentum indicator function is to check the price momentum of buyers and sellers. The volatility indicators main purpose is to check on the fluctuations in prices and at what magnitude these fluctuations are taking place. Cycle indicators are used to analyze the ups and downs in the prices.

The best way to check on whether you have chosen the accurate indicators that supplement each other rather than duplicating the results is through the use of chart. What you can do is that, make a chart, put all the forex indicators that you have chosen and check on the results when you see a trend. If the chart is showing ups and downs in same intervals at the same time, then you have same set of foreign indicators and they are supplying you with the same information every time.

There is no limit on the number of indicators that you can choose. There is no problem with the number of forex indicator a person picks. You can pick as many indicators as you like. If that is the case, then you need to analyze each and every forex indicators in order to take out the best analysis otherwise the information you collect would not be valuable.

When it comes to foreign trade there are many firms of great repute who are offering forex indicators that are available online. All you have to pick the one that is most useful to you and gives accurate results. Prices play major role on the success of your business and that is why you need to trust those firms which are credible because you come across many firms which will provide you with inaccurate data and wrong estimates of peaks and fluctuations of prices which in real are not there. In order to make sure that you come across forex indicators that give best results is to check on the information and reviews given by other users before using an indicator.

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ProIndicators.com is providing high precision TradeStation. All forex indicators perform different functions and can be used for different analysis.

By ProIndicators – NinjaTrader Indicators is known to be a dynamic industry standard for trade management and order entry purposes. It is specially designed to cater the needs and requirements of the clients for trade purposes. With the amazing Advanced Trade Management (ATM) technology it has surpassed in the field of trade management. It not only secures the open arrangements of the clients with it predefined approach but also helps in loss prevention and enhances profit band. All this is done through a marvel of semi automated systems that change according to the clientele requirements; such as order enrollment, rambling stops, auto-breakeven pauses and so on.

At NinjaTrader Indicators clients get an uninterrupted key solution with the competence of state-of-the-art automated strategy. Sequential way is formulated to meet the client’s needs; starting from the development of plan, constructing it, testing it historically, optimizing it, testing it via live imitation model and then installing it live through an account. Trade effectiveness and efficiency is what is achieved at NinjaTrader Indicators. Many potent features are added that support the clients at all trading phases and eventually enhancing their trade in the market. Moreover, internationally acclaimed NinjaTrader SuperDOM is making trading lot easier and beneficial in recent times. With a single click of a button an order can be placed or modified. It can be effectively done by ATM technology that semi-automates the trade management.

NinjaTrader Indicators also helps in carrying out technical research and trading in real-time using sophisticated chart window. Some of the great benefits clients can reap from it are Fast order entry, exit and scaling (in/out), order entry and modification on a single click of a button, high resolution display of order and position, smart OCO (Once Cancels Other) orders on entry and during scaling in or out, direct entering, changing and canceling orders in a chart, easy monitoring of position size and on spot profit and loss estimation and usage of ATM technology.

Advanced Trade Management features allow an open trader outstanding trading benefits with the implementation of personalized conditions for semi-automated trade management. They can easily use in-built strategy templates for trading purposes. It not only is cost effective but also saves time of the trader. In that respect NinjaTrader charts are carefully designed to meet diverse needs of any type of trader. Whether one may require on-time trading details or need comprehensive information with market results, NinjaTrader Indicators are proven to be the best solution for your business needs. Its predefined automation system is easy to use without any hassle of information handling of the orders and the visuals presented are in the optimum form with the option of customization.

NinjaTrader’s Market AnalyzerTM window is a charge sheet which is designed to scan and analyze the trading data at the spot with sophisticated built-in 100 indicators and data columns. It simplifies and gears up the analytical process of the trader in couple of minutes without undergoing any human error. From the development stage till the deployment of a strategy through the trader’s account, there is no other more transparent and dynamic end-to-end solution available than NinjaTrader Indicators.

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ProIndicators.com is providing high precision TradeStation. NinjaTrader Indicators are proven to be the best solution for your business needs.

By Cedric Welsch – The U.S. Dollar’s exchange rate, as expressed on any US Dollar exchange rate history chart, will only tell the story of how the dollar has performed against another specific currency. FOREX trades are made strictly in pairs, as one country’s currency versus another. How the U.S. Dollar performs against the Euro Dollar may be totally different than its price relationship to, say, the Japanese Yen.

The U.S. Dollar is the most traded financial currency of any in the FOREX market. All the most favored trades include the Dollar as one of the pair. The most often traded pair, by the way, is the Euro Dollar against the U.S. Dollar. When this trade is entered into by investors, they are betting that the relationship of the Euro and the U.S. Dollar will go the way they predict. If the trade is long, they are expecting the Euro to increase in value. If the trade is short, they are hoping for the opposite.

Back in July, 1944, at the height of the Second World War, 730 representatives from all the 44 Allied nations met at a hotel in New Hampshire for the United Nations Monetary and Financial Conference. Obviously, delegates from Germany and Japan were not in attendance, since those countries were not part of the Allied group. It was during this conference that the IMF (International Monetary Fund) was created and a system which became known as the Bretton Woods System was put into operation.

Looking at a US Dollar exchange rate history chart from that time shows the dollar to be the strongest world currency, but the war was very expensive. This system was meant to establish rules for international monetary policy and for the financial relations between member countries and their individual currencies. These rules obligated countries signing the accord to adopt financial and monetary policies that would keep the exchange rates of their respective currencies within a certain range as they related to the current value of gold.

This all changed, however, when in 1971, the U.S. unilaterally went off the gold standard by canceling the convertibility of dollars directly into gold. No longer requiring its currency to be backed by gold, the U.S. was free to print as much money as it liked. Many experts see this event as the cause of the financial meltdown suffered in the world beginning in 2007.

Currencies are now said to ‘float’ and their values, relative to one another, continually change. Bad economic news in a country can often cause their currency’s value to drop. Good news will frequently have the opposite effect.

The U.S. Dollar is currently traded against all major world currencies. This includes the Euro, the Yen, the Pound and the Swiss Franc. For an accurate US Dollar exchange rate history chart to be truly representative of dollar strength, it would have to be compared to a basket of all these individual currencies.

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Do you want to really make profits with forex? Make sure you get fresh updates ahead of everybody else here: Forex News

Also, you need to know how to read and analyze the trading market well. Learn Currency Trading News

Online Forex trading facilitates currency transaction from the comfort of your house. It’s a 24 hour ultimate home business which you can optimize depending on your convenience. It gives you the freedom to start trading with as little as a thousand dollars. Online forex trading offers a highly rewarding experience, provided you are properly prepared and well trained.

Forex is a major platform that yields significant profits. It is the world’s largest trading market with a daily trade of more than 2 trillion dollars. Known for its extreme liquiditiy and high scale trading volume, currency trading can be done from any part of the world. Real time accessibility is the greatest advantage with online currency trading.

Traders of forex market can now access online brokers and forex firms with a single click. After meticulous analysis and observations, they offer real time forex transaction details, charts and quotes. All you require is a computer with internet access. It gives traders the freedom to decide every trading agreement and analyze the market without getting out of doors.

Forex Expert Advisor

Forex Expert advisors are programmed systems customized to function on specific trading platforms known as metatraders. By far, it is the most popular platform amongst traders and brokers. It is either simple or complicated depending on algorithms and various other parameters. It advises the trader on the size of trade, buying, selling and closing positions, besides placing orders automatically.

Some forex expert advisors sometimes, contain account managing functions. When well programmed, it reads your previous trades, account stats and other criteria, before advising or deciding on the size of trading. Expert advisor installation is highly simple. It sometimes comes in hard coded or source coded format.

Forex Expert Advisor is a new technical analysis tool based on significant levels of resistance and support. Well experienced forex advisors help you to conduct trading in a simplified process. Beginners can use free forex expert advisory services for easy facilitation of online trading.

Currency Trading Brokers

Currency trading brokers facilitate online forex transactions. Every currency broker have their own type of charges, known as spread. There are two types of trading brokers – one with dealing deaks and the others without. A forex currency trading broker without dealing desks are the most advantageous.

They match purely on orders and don’t trade to drive prices up. You also get the choice of ECN broker. They include interbank forex traders and and feature larger trade minimums. They are highly reliable and seek smallest spread.

Check several currency trading brokers before opting for one. There are various parameters which may influence your choice. These options are vital as they determine your investment interests and account management. Though a good method to make money, trust has to be a vital element. The first point of consideration is the website quality. Spend some time in the firm’s website, check the site structure and look. Every trading site has a writ online agreement. Scrutinize all remarks before signing up.

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fxcentral.net

By Cedric Welsch – Forex currency trading for beginners is not as difficult as many would think. It is quite appealing for anyone to be able to participate in the world’s largest market from the privacy of their home. More and more people are turning towards starting a full time or part time career centered around trading global currencies. Trading currencies can be quite profitable and can generate a steady stream of income, but there are some risks that one must be willing to accept. Patience, hard work, and endurance are three ingredients that can help anyone become a successful trader.

The Forex Market was once exclusive only to large financial institutions, experienced currency traders, and global corporations. The advancement of communications and technology changed the landscape. The birth and existence of the internet now allows individuals the opportunity to become serious players. Recent studies show that more and more individuals are turning towards this market in order to become full time or part time traders.

Here are three principles that can help novices experience success in The Forex Market:

Learn The Basics

Currency trading revolves around the buying and selling of global currencies. Profits are gained from the difference attached to the purchasing and selling price. The goal is centered around so be aware of when to purchase and when to sell. There are many currencies that are available for purchase. It is the novice trader’s responsibility to select the superior currency pair. It is advantageous for beginners to stick with currency pairs that have a good history of not being too volatile.

Learning the common terminology used in the market is one of the first steps that should be taken in Forex currency trading for beginners. Notations should also be adhered to. Failing to grasp this basic knowledge will impede one’s progress in becoming a successful trader.

Intense Market Study

Foreign exchange revolves around purchasing the currency that has low value and selling it when the value becomes high. The value of the currencies will constantly fluctuate. Intense market study will help one make prudent predictions on future market behavior.

Partaking in fundamental and technical analysis will assist market participants in learning how to interpret signals and make prudent decisions. The most successful traders spend countless hours in study. They understand that market knowledge is vast and changes over a period of time. Intense market study separates the professionals from the novices. Novices will only become professional one day if they are willing to devote a great deal of time towards studying the market.

Tools For Trading

Charts, trading software, and pure data on market prices are three tools that will help one succeed with their trades. Purchasing reliable trading software will also serve as a great benefit.

The Forex Market is providing a golden opportunity for anyone that wants to earn a full time income from home. One can even use the market to supplement his or her income. Adhering to the three principles will help simplify Forex currency trading for beginners.

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Do you want to really make profits with forex? Make sure you get fresh updates ahead of everybody else here: Forex News

Also, you need to know how to read and analyze the trading market well. Learn Currency Trading News

Who said that resolutions can only be made on New Year? Well, it’s still roughly 3 months from the first of January and I already made mine. I mean… the earlier I make the changes the better, right? So let me cut to the chase and tell you now what they are. Here are my top 10 forex decrees:

1)      Don’t hesitate to trade the breakouts!

• Chart patterns are the bread and butter of technical analysis. There are five basic must-know chart formations – triangles, head and shoulder (inverted), double bottom (tops), cup and handle, triple bottom (top). If you spot a breakout.. trade it!

2)      Don’t forget the fundies!

• Marry fundamentals with technicals like you’re marrying Jessica Alba. Okay, the latter does not make any sense. In any case, you should always try to execute trades that are both supported by technicals and fundamentals/sentiment as this would increase the chance of them winning.

3)      Don’t gamble!

• Say no to rogue trading! Trading currencies is not like in a casino where you can just do a one-time big time trade. Of course you can do that but don’t fret if you find your account down to zero the following day. If you want to gamble.. go to a casino! It’s more fun there! If you want to profit… trade forex in a systematic way!

4)      Don’t revenge trade!

• Did I say no rogue trading? Well, losing is part of the game. So if you do just relax, calm down, and move on. Don’t hit the entry button again and trade twice or thrice of the position that you lost in hopes of getting it back and even winning in one go. You’ll find yourself in a deeper ditch if you lose again.

5)      Manage your positions wisely

• Manage your positions wisely like your managing your chicks… I mean your checks. Don’t risk more than 1% of your account balance in one trade. Enough said!

6)      Avoid trading in a highly volatile time

• Trading during the releases of high profile reports like GDP and NFP is not my style. I got whipsawed the last time I tried to ride a sudden slide in prices from a GDP report. You cannot really gauge how much a currency will move given a report. You might get the tail end of the move if you decide to just jump in. If you miss it… then stay away.

7)      Trade on retracements

• This one is related to number 6. If you miss a breakout or the initial strong move in prices then don’t just jump in. Wait for it to retrace (sounds fancy, eh?) so you can get a better price. Hit the limit order function… it’s there for a reason.

8)      Be flexible

• The market acts like a girl… fickle minded. You just don’t know what she wants exactly. So sometimes it is best to just adjust and be flexible. To be profitable and likable you gotta do what the woman wants.

9)      Use a journal

• Okay, journalizing sounds kinda gay-ish. But if you want to keep track of what’s working and what’s not in your trades then you better jot all of them down. Write down your trade ideas, what happened, what you did, what you felt… everything.

10)   Go out. Drink. Chix.

• Yes. You read that correctly! Forex is a tough business with all the things that you have to read and analyze. We’re just humans. We get strained too. Sometimes we have to take a break as well. So for my tenth decree… Free yourself from stress. Clear your mind. Go out. Drink. Chix.

So there you go… my top 10 forex resolutions. Currently, I’m working on the tenth (Hey Babe!). Alright. Got to head out now. Peace!

More on LaidTrades.com …

By James McKee – Pips, leverage, support, pairs, and so on…an entire esoteric series of words that are used to convey joy, fear, instructions and a variety of other things. Understanding what your broker and fellow traders are saying is absolutely critical to your success in the Forex market. A lot of people think of those in the financial industry as being less than friendly but I can assure you this is not the case, contrary to popular opinion those who work hard and get paid for it tend to be a very friendly group of people. Forex traders in my experience have been a great group of individuals looking to help new traders when and where possible. To take advantage of these resources however you need to be able to communicate, so let’s go over my top three Forex vocabulary words!

Pips-This is a word you will see over, and over…and over again. It is what every broker and trader is after, and what you should be after as well. For the sake of clarification let us assume that you invested in the pair EUR|USD and at the time the euro was worth 1.3490 in comparison to the US dollar. So your trade goes from 1.3490 to 1.3498, you have just made 8 pips. The exception to this four decimal point standard is the pair of the US dollar to the Japanese yen in which there are only two decimal places.

Leverage-Another extremely important word to know (and a very important concept as well) is leverage. In the Forex market leverage makes our profits possible and our leverage is greater than that in any other market. Since currency is typically purchased in 100,000 lot increments (dollars, yen, euros, etc…) there has to be a rather large amount of leverage given to the trader on the part of the broker. For a $1000.00 trade the leverage will typically be 50:1 or a total of $50,000.00 ($1000.00+$99,000.00 from your broker). This sounds like an insane risk on the part of the broker until you consider that currency rarely decreases in value by more than one percent on any given day.

(Currency) Pair-It is all about pairing in Forex, you are buying one type of currency with another in the hope that the purchased currency will become more valuable so that you can exchange it back at a profit. An example of this would be purchasing $50.00 euros for $100.00 dollars, and two days later buying back your dollars with the value of the euro increasing by (FOR THE SAKE OF CLARIFICATION) 50%, at this point you can change your euros back in for $150.00 for a profit of $50.00. Of course with leverage in play currency won’t have to jump much at all for you to realize profit.

These are just the absolute must knows I have decided on in the Forex market, there are (give or take) about 200 words (by my estimate) that being used by Forex traders/brokers to refer to the market. I will make an effort in the future to come up with a more comprehensive list in the future but this should get you started!

About the Author

The author’s love of life is ultimately rooted in his drive to learn Forex, information is meant to be shared so please don’t hesitate to comment on my articles!