Month: October 2010

By Cedric Welsch – If you are becoming involved in forex trading online, then you need to find out the strategies, such as forex trending indicators, that the highly experienced traders use in order to maximize their profits and the percentage of their wins on the currency exchange market. Learning how to use forex trending indicators is one of the secret weapons that you can put to use.

A trending indicator in forex is used to work out the strength and the direction that currency pairs are moving. You can use these indicators to decide when you should either buy or sell a currency in the market. There are various indicators that you can use however, they are only useful in a trending currency market and not a ranging market.

If you are following a trend, then you are finding a pattern in the movement of the placement or value of the currency. This gives you a trend line and you can use this information to inform your decisions to buy or sell currency pairs depending on which direction the currency is trending. You can also use data analysis, however watching for trends is one of the best indicators.

Using forex trending indicators to make your trades is a good strategy to utilize as it can account for important events that can affect a currency such as economic policies, and these can play out over a long time period. By understanding the kind of impact that wider economic events can have, you can use this knowledge to help you in your trading. A chain of events for example can be kicked off by a cut in interest rates, which leads to more banks lending money, more economic growth and jobs created.

There are different types of indicators that you can use to identify and analyze the trends that occur in forex. One of the most basic of these indicators is the moving averages indicator. There is a basic version and an exponential moving average. The exponential moving average is more sensitive to recent events and price movements in the market place.

A moving average is not generally one of the most up to the minute indicators that is available to the trader, but they are steady indicators of more long term trends and can be useful with establishing an entry and exit point with a currency pair to trade.

Another indicator that is useful to the trader is a Bollinger Band. These were created in the eighties by a financial analyst named John Bollinger. The way that it works is by taking a moving average and placing a band at the lower end of the average and a band at the upper end of the average. You get a buying or selling signal for the currency pair when the price action moves over either of the bands that have been established.

There are other forex indicators that you should understand in order to maximize your success in trading. If you use forex trending indicators, your profits will be more consistent.

About the Author

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 ProIndicators – The most sought after and popular program in the forex market is forex trading metatrader. It is widely being used all over the world. The number of such programs available to people who want to enter the forex market is numerous. The usage of these programs allows people to earn profit by working conveniently as they are able to work their way into the forex industry. The amount of work one has to do to achieve desired results is minimal. That is why forex metatrader is used by most of the people. Not only has it allows you to navigate the market easily and move through it but also it is very user friendly. However, there are few people who are not convinced about the use of metatrader indicators and do not believe in its success. What these people don’t understand is that forex trading metatrader is one of its kind and the following benefits of it might help people change their perception about this program.

No matter where you are living you can use this program. The program has the option for different set of currencies. These inclusions of different currencies allow people from around the world to use this program. One of the other good things about metatrader indicators is that it makes the use of large historical data when doing back up testing. Not only this but each set of data has its own back up that can be easily found at the metatrader server.

Security has been the main reason why people do not trust such kind of programs. Metatrader indicators provide the user with highest level of security. In order to provide such level of security the metatrader requires every user with large amount of authentication. This authentication allows it to create an environment in which the users can feel safe and do their trading without any security concerns in their mind.

The main benefit that people want from this type of metatrader indicators programs is in real time. This is what this particular program can do. What it does is that it allows user to receive all the crucial information related to forex in real time. Another benefit that this metatrader indicators program brings is that you can call for all kinds of report immediately and it also tries its best to come up with as much accurate information as it can.

No matter what type of program you use there would always be some flaws in it and same is the case with metatrader. There are some flaws associated with metatrader and it is best that you be familiar with it. The two most common disadvantage of metatrader is that it only basis its decisions on the set guidelines which has been indicated by the user at the beginning and in the case of flash news in forex market the metatrader indicators would not give immediate response. However, it does not mean that this program is not good. Its benefits are much more than costs associated with its usage and that is what users should base their decisions on.

About the Author

ProIndicators.com is providing high precision TradeStation. Metatrader indicators provide the user with highest level of security.

By Jared Ingram – The foreign exchange (forex) market is a very big financial market and, if you want success, you should be looking for forex trading strategies to maximize your potential revenue. Scalping in forex trading is one of the known and well-utilized trading strategies.

Scalping is more dependent on recurrent and short-term forex trades compare to other forex strategies. Actually, scalping is the sole terminology in the world of forex that is the most flamboyant piece. Traders who practice the scalping strategy are called scalpers and they are not after making lots of money on any particular trade. Their main goal is to achieve several very little pips for every trade. They want to earn small profits but frequently so that, at the end of each trading day, they have a considerable large amount of revenue. The time frame when doing scalping can be as short as a minute.

Scalpers are often the source of annoyance of some brokers. They usually do trades on a position even before the broker can fill out his first order. As a result, the brokers can lose money from this transaction. Because of advancement in technology, brokers today have the chance to fill out the orders they receive more quickly so scalping is not much of a nuisance like it was a few years back. Because of this practice of scalpers, majority of online forex broker websites, ban scalpers from getting access and they usually put a limit on the number of trades that you can make per day. In fact, one can trade for only about a dozen of times per day.

If you want to utilize the strategy of scalping which is also called picking, the very first thing that you should do is to search for an online broker who has no issues with scalping method. This task is so easy to be done for the recent years because the presence of forex market online has significantly grown.

Your next step is that you check out the forex broker especially all of the associated fees for every trade. A lot of sites are charging traders around eight point for every spread. Apparently, if your aim is to earn revenue of just some pips for every trade, then a spread which is two to three times of that is a hindrance to become profitable. Anyway, given the fact that there are scalpers who can still become profitable using brokers that have high spreads, it is enough proof of how powerful scalping in forex trading can be.

In a lot of ways, the central focus of scalping strategy is the extra special attention the trader gives to the forex market movements. As the trader continuously and closely watch the market, the scalper can hypothetically predict when the market is going in the middle or up or down. The skilled scalper will then go out to buy a currency pair whenever he or she feels that it’s appropriate and then this pair of currency is sold as soon as the scalper sees that he or she can reap some few pips that are profitable.

About the Author

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

By ProIndicators – If want your Forex trading to become successful, then there is a need for Forex indicators. These will help you in achieving an improved marketing timing together with the trading signals. There are some Forex trading indicators that are considered as the best, and you can use all of them to have bigger Forex profits. These trading indicators need to be combined since they should work hand in hand. Using only one would be useless. Below are the best Forex indicators, how to use them and to combine them. Keep in mind that these trading indicators are easy to use, thus knowledge of calculation is not needed.

Bollinger Bands

These are trading indicators that determine the instability of price. Indicator is made up of 3 bands, one on the middle and two on the sides. The middle band is used for simple average, while the two side bands show the volatility of a market. What is the use of volatility? When it is high, you will have a retracement back to the mid band. This will allow you to have opposing trades that will conflict on the high volatility. In addition to the simple average, the mid band is also used as value in strong trends. Therefore, you can buy and afterwards, have it sold. Bollinger bands provide you trading set ups, however you should not perform the trading signals if you did not confirm them with momentum indicators.

The Stochastic

It is the great momentum indicator used for market timing. It is that great that every dealer should be aware of. It is used to determine if the momentum is strong or weak. It can also determine if a market is being oversold or overbought. Among the trading indicators, this is one that is very easy to use and also very effective. A very simple strategy of using it is to have two stochastic lines and then trade their crossovers. These can be used for trend following or for contrary trades.

Relative Strength Index RSI

This is developed by Wells Wilder, a trading legend. It provides an indication of the strength of a trend, which can be seen at a glance only. If this will go along with your insight of the trend, you can stick with it. However, if it will diverge from your perception, then you have three options. You can either have a potential opportunity for your trading, trade on another way, or shut in some of your profits.

Average Directional Movement ADX

This gives a sign if the market is consolidating or if it is in a trend. Moreover, it keeps in line with the finest trends and it can also indicate if a great profit is taking place. Once the ADX line reach 40 and lowers down, it signals that you are having a profit taking. You should be observable of this because it can save a lot of your money over your trading career.

Moving Averages

This is not very popular; however it is one of the best trading indicators that you can use. This is simply because the 20 day MA is applicable when there is a temporary spike of short time price.

About the Author

ProIndicators.com is providing high precision TradeStation. If want your Forex trading to become successful, then there is a need for Forex indicators.

By Jared Ingram – If you want to earn money in forex trading, you should try at least one of the forex online trading strategies. With your basic knowledge and understanding about forex and utilizing one of these forex strategies, you can gain profit. Some of these trading strategies are news trading strategy, swing trading strategy and range trading.

News trading is actually the term used when forex trading is actually focused on news-worthy current events. Generally, these events are about updates on significant economic data. Half of the time, the news is about the US market but there can be pertinent economic data related to the other currency pair. The energy of the trader is spent on determining whether the news release is a match or an excess or a shortage of forecasts.

The next step is determining the market’s reaction. Surely, some stories are significant than other releases. The challenge here is to predict the market’s move in particular news. After you have decided how the market is going to move, you have two main choices. First one, is you can position a straddle offer where you purchase longs and shorts on either current value of one of your currency pair. If you do this, it doesn’t matter where the market is moving. It works effectively but you may lost a lot of money too if the resulting fluctuations are really large because of the unpredictability of the news release and both of your orders are filled.

Your second choice is to try long or short on the forex currency but it depends which way you feel that the market is going. There is more risk involve here where you do not have an order filled but you have more available capital to raise the order size than if you put a straddle order.

Another forex trading strategy is swing trading. This is a style of forex trading utilized in forex market that seeks to achieve gains by keeping positions for a period between one day and one week. Aside from day trading, it is one of the most short-term trading styles. This is generally used by technical traders. In order to practice swing trading, the Bolinger bands can be the most helpful tool you can utilize.

Since swing trading is just short-term, it is very effective for a lot of forex traders. Generally, most strategies that support short-term trades are fitted to the forex market since there are no commission fees and significant spreads involve at most brokers.

The range trading strategy, on the other hand, grabs the advantage of lower instability as the forex market moves sideways. To setup a range trade, you should decide which the right currency pair is. Go for pairs that have low differentials on interest rate and where their economies are interconnected. Then, know if there are barriers by looking at the highs and lows, Fibonacci levels and Bollinger bands. Set your limits close to the peak of resistance and your stops on several pips. Then, make sure that you have goals for every trade.

These forex online trading strategies are just some of the steps you can take to win in the big world of forex market. Research more about these strategies and find out which one is most suitable for your situation.

About the Author

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

By ForexYard – The euro rose to a new six-month high of $1.3733 Friday, carried on a fresh wave of positive risk sentiment. Although the single currency was initially hurt by strong U.S. data Thursday, it started to bounce back after China reported that its purchasing manager’s index for manufacturing rose by more than the market had expected.

Optimism about the global recovery was helped further by revisions to last week’s purchasing managers’ indexes from the euro zone. These showed that the joint euro zone index was actually higher than initially estimated–up at 53.7 from 53.6 in September. This helped the euro to shrug off earlier bad news that German retail sales hadn’t only fallen by 0.2% in August, instead of rising by 0.5% as expected, but that sales in July had also fallen by 0.4% rather than by the 0.1% that had been estimated originally.

As investors showed more interest in risky assets, European stock markets posted gains of nearly 0.7%, following on from a 0.4% rise in the Nikkei Index in Japan. Some analysts reckon the euro will continue to rally, especially if new U.S. data due later today proves to be as disappointing as expected. The Institute for Supply Management’s index for manufacturing is forecast to have fallen to 54 last month from 56.3 in August. Also, the latest University of Michigan’s consumer confidence index is seen down at 67 from 68.9.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By Anton Eljwizat – Gold hit a record high of $1,315 an ounce this week, extending a two-week rally of fresh records on concerns over an economic recovery. Gold has made a significant upward correction, which can be directly correlated with the bullish trend of the EUR/USD cross. As I will demonstrate below, the price of gold may very well be heading for a reversal. This recent activity has raised the stakes for traders. From here on, the forex and commodity markets will see very high volatility indeed.

• The technical indicators used are the Slow Stochastic, Relative Strength Index (RSI) and Williams Percent Range.

• Point 1: There is a “doji” candlestick that has formed on the chart, indicating that a reversal should take place.

• Point 2: The Slow Stochastic indicates a bearish cross, signaling that the next move may be in a downward direction.

• Point 3: The RSI signals that the price of this pair currently floats in the over-bought territory, indicating downward pressure.

• Point 4: The Williams Percent Ranges is showing that this pair is heavily over-sold and may be experiencing strong upward pressure.

Gold Daily Chart

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By GCI Forex Research

Fundamental Outlook at 0800 GMT (EDT + 0400)

USD

The dollar-positive effects of yesterday’s stronger US data began to wear off during the Asia session. The greenback surrendered some ground after FOMC voter Pianalto said policy options to get the Fed on the path to achieving price stability are being investigated. A better than expected China PMI reading temporarily supported the AUD. EURUSD traded 1.3604-1.3667, and USDJPY 83.37-83.58. Jobless claims fell slightly more than anticipated to 453k and the renewed downturn cautions against extrapolating the mid-summer soft patch in economic activity. Chicago PMI rose to 60.4 and details were strong but the Milwaukee PMI fell to 50. And Q2 real GDP growth was revised up to a 1.7% annual rate. Price data was little revised, with core PCE to 1.0% from 1.1%. The positive data may have given investors pause in their expectation for further easing but easing concerns will persist unless we see continued data improvement. And it will be key how Treasury yields react to the data releases, as higher yields could provide some respite for the dollar. University of Michigan confidence, ISM Manufacturing, core PCE and deflator data for August are due.
EUR

The euro remained relatively stable after overcoming the latest risk events. The Irish government announced that the domestic banking system will require further government-sponsored capital injections, the size of which were broadly in line with expectations. Finance Minister Lenihan said that holders of subordinated debt of a nationalized bank would be expected to make a significant contribution to the bailout. The euro initially fell on the news, but a recovery soon ensued as Irish sovereign spreads over bunds began to tighten. The euro drew further strength from reduced demand for ECB cash at the latest tender, and a better than expected fall in German unemployment numbers. The anticipated Moody’s downgrade of Spain also passed quietly – Spain fell only a single-notch in the rankings, and the outlook was set to stable.
The Irish central bank announced that the domestic banking system will required further government-sponsored capital injections. The Irish Finance Minister said that holders of subordinated debt of a nationalized bank would be expected to make a significant contribution to the bailout.
JPY

CPI excluding fresh food improved slightly, as expected, to -1.0% (prev. -1.1%). Prime Minister Kan said, in a clear reference to next week’s policy meeting, that he hopes the BoJ will take further necessary steps to beat deflation. Both he and Finance Minister Noda also said that Japan will continue to take decisive steps as needed to counter the yen’s rise.
Ministry of Finance data revealed that Japan undertook JPY2.1249tn of FX intervention in the month of August 28-September 28 (approximately $25bn). This was broadly inline with market estimates and suggests that intervention was limited to a single day.
GBP

The UK data calendar was light with the Nationwide house price index increasing 0.1% m/m, ahead of consensus of -0.3%. Cable moved higher in the overnight session but then fix-related selling pressured sterling.
Prior to the New York open, BoE policymaker Posen said he could be talked out of his opinion of further QE. The MPC appears more fragmented between Posen’s pro-QE approach, Sentance’s dissent and the rest of the committee.

CAD

July monthly GDP was negative as expected and BoC Governor Carney again cautioned on the economic outlook, similar to the latest BoC statement. He stressed the unusual uncertainty surrounding the outlook and reiterated that future monetary policy moves would have to be carefully considered. The BoC raised the policy rate at its last meeting but the concerns of further Fed easing have tempered expectations for the BoC’s policy rate path, which has weighed on the Canadian dollar.

TECHNICAL OUTLOOK

EURCHF breaks 1.3391.
EURUSD BULLISH Upside potential eyes 1.3692 with scope for 1.3896 next. Near-term support comes in at 1.3381 ahead of 1.3287.
USDJPY BEARISH Focus is back on the downside; break of 82.88 would expose 79.75. Resistance remains at 84.50 ahead of 85.40.
GBPUSD BULLISH Bull stalls in front of 1.5999 key high; key reversal lower has support at 1.5503.
USDCHF BEARISH Next support below 0.9625 lies at 0.9500 psychological level. Resistance at 0.9918 breakout low.
AUDUSD BULLISH The pair is expected to target 0.9850 with scope for 1.000 psychological resistance next. Support is at 0.9559 ahead of 0.9463.
USDCAD NEUTRAL 1.0509 and 1.0108 mark the near-term directional triggers.
EURCHF BULLISH Following the break of 1.3391 model had turned bullish. Need a break above 1.3924 to confirm the positive trend.
EURGBP BULLISH As long as support at 0.8463 holds, expect the pair to target 0.8736 ahead of 0.8808.
EURJPY BULLISH Momentum is positive; clearance of 114.74 would expose 116.68 and 119.33. Near-term support comes in at112.67 ahead of 110.66.

Forex Daily Market Commentary provided by GCI Financial Ltd.

GCI Financial Ltd (”GCI”) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (”Forex”) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (”CFDs”) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.

DISCLAIMER: GCI’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.

Source: ForexYard

The end of the month brought a volatile trading day as US GDP and weekly unemployment numbers were released. Irish Banking woes continue to weigh on the markets but failed to slow a strong month for equities.

Economic News

USD – ISM Manufacturing PMI on Tap

Today’s trading was swamped with positive economic data on the calendar. However, the better than expected data did not help the US dollar increase versus its rivals. US Final GDP was better than expected at 1.7% on expectations of 1.6%. Weekly unemployment claims were also better than forecasted. Only 453K new jobless claims were reported on expectations of 458K. Positive data from the business sector was also released as the Chicago PMI index climbed to 60.4 from a previous reading of 56.0.

Despite the strong economic numbers, traders showed little interest in pushing the US dollar higher. The EUR/USD traded in a range between 1.3680 and 1.3560. The USD/JPY was unchanged from its opening day price of 83.56. The dollar did show strength versus the British pound and the Swiss franc. The GBP/USD dropped to its lowest level of the week at 1.5668 while the USD/CHF rose as high as 0.9843 after opening at 0.9774.

US equities were weaker on the day as the Dow Jones Industrials Average posted a loss of 0.4%. September was a good month for US stocks as the Dow rose 7.7%, the largest gain in September trading since 1939. September is typically considered a gloomy month for stocks. The catalyst for the gains in the Dow was positive US economic data that reduced the risk of a double dip recession.

The market’s expectations for improving economic data will be tested today with the release of the US ISM Manufacturing PMI. Better than expected data could continue the recent trend of dollar weakness. The EUR/USD could rise to the resistance level of 1.3820.

EUR – Euro Shrugs Off Negative News

European financial woes are reemerging following the bailout of Allied Irish Banks and the downgrade of Spanish sovereign debt by Moody’s.

Ireland will need to fork over 34 Bn euros to shore up failing Allied Irish Banks. The recapitalization of the bank will most likely affect the Irish budget which should reflect a higher debt to GDP ratio.

Moody’s investor services downgraded Spanish sovereign debt by one notch to Aa1 from Aaa and held the outlook stable. Moody’s is the last of the major ratings agencies to downgrade Spanish sovereign debt. The move was largely expected by the market and did not come as a big surprise.

Despite the negative news, the euro has shrugged off the publicity and continues to strengthen against its rivals. Yesterday the rate of the EUR/USD was largely steady, but the EUR/GBP was up sharply at 0.8679. This is up from an opening day price of 0.8583.

British Manufacturing PMI data will be the catalyst for today’s EUR/GBP trading. The next resistance level for the EUR/GBP rests at 0.8770.

JPY – USD/JPY Continues to Weaken

The downtrend of the USD/JPY continues and has shown few signs of slowing since the Japanese Ministry of Finance intervened in the forex markets over two weeks ago. Traders are once again testing the resolve of the ministry and the Bank of Japan (BOJ) to intervene.

There is no said line that is drawn in the sand that once crossed the BOJ will begin selling yen on the open market. But it appears traders are targeting the recent low for the USD/JPY at 82.86.

A glimpse of hope for a reversal in the trend lies in the ascending wedge pattern that has formed on the monthly chart. A rise in the price could test the resistance level at 90.80. A close above this on a monthly basis would confirm a breakout to the upside.

However, there is always a chance the pair will continue and break to the downside. Traders should eye a breach below the 82.80 level for a sign of a continuation of the downtrend.

Oil – Oil Prices Rise on Positive Economic Data

The price of oil rose sharply yesterday by 3.4% on the heels of positive US economic data. The rise in the price left crude oil with a strong performance for the month of September that coincides with a strong month for US equities.

The release of rising US GDP numbers, better than expected weekly unemployment data, and a rising Chicago PMI all helped to influence traders to become more bullish on the economic recovery.

Momentum for spot crude oil appears to be to the upside as the MACD histogram shows a rising trend. This may signal further gains in the price of spot crude oil. The next resistance level for the pair is found at $83.00.

Technical News

EUR/USD

Momentum continues to increase to the upside with the 20-day simple moving average sloping higher. As such, traders should favor trades in that direction. A bullish channel has formed on the daily chart, beginning at the September 12th low. Traders should target the upper line of the channel which coincides with the March high of 1.3820.

GBP/USD

Traders should be cautious with the pair following yesterday’s selloff. The long red candlestick follows three days of consecutive doji candlesticks. The halt in the uptrend occurs at 1.5870 which coincides with the 61.8% Fibonacci retracement level from the November 2009 high. All of this may signal a reversal of the trend or at least a period of a consolidation.

USD/JPY

A distinct declining wedge pattern has formed on the monthly USD/JPY chart that could signal a reversal of the downward trend. As the long term trend is clearly to the downside, traders will need to be extra patient before taking a long position and wait for a clear signal that a breakout to the upside has occurred. This month the price could test the resistance level at 90.80. A close above this on a monthly basis would confirm the breakout. However, there is always a chance the pair will continue to the downside. Traders should eye a breach below the 82.80 level for a sign of a continuation of the downtrend.

USD/CHF

Two days of appreciation in the pair may present a sell opportunity to enter into the downtrend. The price of the pair rose as high as the 0.9840 level where it then proceeded to head lower. This may be the time enter short with a target at the 2008 low of 0.9632.

The Wild Card

Crude oil

Crude oil is showing signs that momentum is to the upside. The 7-day Momentum indicator is sloping sharply higher and the MACD histogram is also rising. Yesterday the price breached above the resistance level of $80. Forex traders should be targeting the next resistance level at $83.00.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.