InvestMacro FX

By Donald Ogilve

They say there is a shortcut to everything, provided you are ready to pay for it. This is true about Forex trading also; well sort of. If you are a novice trader, you may find Forex trading just a little bit too complex, with so many things happening at the same time. So much so that it is really difficult to follow everything closely. It is not that the Forex trading is inherently hard to understand, but it takes time and patience to comprehend its multiple aspects.

What if you have a very short supply of both? Does that automatically mean your Forex Trading career should end before it beings? Isn’t there any shortcut available to Forex trading so that you don’t need to go through the painful research and try to figure out trends every time you would like to trade, at least when you first start? You may find yourself asking all these questions. Also, it would be handy if you could tap into the market at every available opportunity. However there are times when moves may happen when you are not online. You would therefore be completely unaware of them.

Automatic Forex trading signals provide a solution of sorts to the problems mentioned above. You can receive automatic Forex trading signals either via software which you have to install on your computer, or via membership of a website that provides automatic trading signal services. The con side is that these are usually paid services. In case of software, it could a one-time payment. In this case, the system is yours to use as you please. However, in the case of enrolling to an automatic Forex trading signal service, you need to pay monthly membership fees, which usually vary between $50 and $500, generally.

The way these signals work is very simple. Your software or your signal-providing agency will do all the necessary research and signal you when to buy or sell particular currency pairs. The idea here is that it eliminates all research, speculation and strategizing that you need to do. Simply open a Forex account, get an automated Forex trading signal service and buy or sell according to the trading signals sent by the automatic service.

The mathematicians, software developers and experienced Forex traders usually work in collaboration in order to build such systems. Therefore one would expect that they would work well. However, like any product in the world, there are some services or software that are of good quality and some are really bad. Reputable sources would be a good place to start.

You will rightfully wonder how come, if these services are as successful as their owners claim, all Forex traders don’t use them. Experienced Forex traders usually already have a time-tested method, which they follow and have complete faith into. Therefore, they would not like to change it for anything as these strategies have worked out for them for years. Also, being very experienced, they do not find Forex marketing very complicated any more and feel no need to hand the control over to someone else, or even a machine for that matter. Newer traders are likely to be confused about whether it is right to trust an automatic service. The answer is that you don’t necessarily have to trust them completely.

People can have various reasons not to try out these methods. Using a Signal Service can be very useful to learn about the markets. A good way to use them is to ensure that, for every signal you get, you understand the reasons why. You can try a service for a short time, and use them to learn about Trading while you are actually trading yourself. If you think that you want to start trading but are feeling low on confidence, you can try out an automatic Forex trading signal service. If nothing, it will enhance your knowledge about how to conduct your trades.

About the Author

Donald Ogilve is a Part-Time Forex Trader. To learn more about making money Forex Trading an hour a day visit Donald Ogilve’s Blog at ForexInitiate.com.

The United States trade deficit fell more than expected in January and declined for the sixth straight month according to a release by the Commerce Department today. The U.S. trade deficit in goods and services was $36.0 billion in January, a decline of 9.7 percent from a revised deficit of $39.9 billion in December. Market forecasts were expecting a deficit of approximately $38.0 billion for the month. The trade deficit is now at its lowest point in six years as import demand has slowed in the U.S. recession.

The U.S. had a total of $124.9 billion worth of exports in January which was a decrease of $7.6 billion over December’s $132.5 billion total. January also saw a fall in imports as imports totaled $160.9 billion compared with $172.4 billion in December for a decrease of $11.5 billion for the month.

The U.S. trade deficit with China increased in January with a $20.6 billion shortfall and reversing a decline in December. Other notable U.S. trade deficits were with Japan at $4.3 billion, the European Union at a $3.5 billion, OPEC at $4.0 billion and Mexico at $2.7 billion. U.S. trade surpluses with other countries for January included Hong Kong at $1.0 billion, Australia at $0.6 billion, Singapore at $0.7 billion and Egypt at $0.2 billion.

By GCI Fx Research

€

The euro depreciated marginally vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.2865 level and was capped around the $1.2955 level.  There is a sense of cautious optimism among some economists that the U.S. economic problems may slowly be improving given recent economic data and other factors.  First, Citigroup indicated it may not need any additional capital injections from the U.S. government.  Second, General Electric said its ratings downgrade yesterday will not impact its business activities.  Third, Citigroup, JPMorgan Chase, and Bank of America indicated January and February were profitable for the banks.  Data released in the U.S. today saw the mid-March consumer sentiment index improve to 56.6 from 56.3 at the end of February.  Also, the January U.S. trade deficit narrowed 9.7% to -US$ 36.0 billion, datum that reflects the significant pullback in global trade.  Notably, the U.S. trade deficit was –US$ 59.16 billion in January 2008.  The February import price index fell 0.2% m/m and a record 12.8% y/y.  In eurozone news, German Finance Minister Steinbrueck reported the current global fiscal stimuli programs could result in a “very big” inflation problem in the medium term.  Data released in the eurozone today saw EMU-15 Q4 2008 labour costs ease to +3.8% y/y from 4.2% in Q3 2008.  Also, EMU-16 January retail sales were up 0.1% m/m and off 2.2% y/y.  Euro bids are cited around the US$ 1.2385 level.

¥/ CNY

The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥98.65 level and was supported around the ¥97.15 level.  Traders are talking about Switzerland’s interest rate cut yesterday and announcement that it will pursue quantitative easing measures including currency intervention to try and shore up the Swiss economy.  Some dealers believe this will pave the way for Japanese monetary authorities to conduct yen-selling intervention while others believe Japan will be less inclined to weaken its currency.  Data released in Japan today saw the February consumer sentiment index print at 26.7, up from 26.4 in January.  Also, January revised industrial output was off 10.2% m/m.  The Nikkei 225 stock index climbed 5.15% to close at ¥7,569.28.  U.S. dollar offers are cited around the ¥104.15 level.  The euro moved higher vis-à-vis the yen as the single currency tested offers around the ¥127.65 level and was supported around the ¥125.40 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥138.35 level while the Swiss franc moved lower vis-à-vis the yen and tested offers around the ¥83.15 level.  The Chinese yuan appreciated vis-à-vis the U.S. dollar as the greenback closed at CNY 6.8380 in the over-the-counter market, down from CNY 6.8383.  Chinese Premier Wen Jiabao reported China will announce a new fiscal stimulus package if and when it is needed.  He also indicated China is “worried” about its holdings of U.S. Treasuries given the U.S.’s declining financial position.

₤

The British pound moved higher vis-à-vis the U.S. dollar today as cable tested offers around the US$ 1.4070 level and was supported around the $1.3860 level.  Representatives from leading finance ministries and central banks are convening near Brighton this weekend to plan for the Group of Twenty meeting on 2 April.  One theme that is emerging ahead of the G20 meeting is that there appears to be a lack of consensus about how to tackle the global economic recession.  The Obama administration is said to be pressuring the European Union to boost the already-announced €200 billion fiscal stimulus it plans to provide member states.  On the domestic front, Bank of England Monetary Policy Committee member Barker reported “While the scale and timing of these various impacts is uncertain, quantitative easing should bring about a pick-up from the present weakness in nominal spending, supporting economic activity…So on balance, the economic outlook has deteriorated further over the past month.” Cable bids are cited around the US$ 1.3740 level.  The euro moved lower vis-à-vis the British pound as the single currency tested bids around the ₤0.9165 level and was capped around the ₤0.9295 level.

CHF

The Swiss franc depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the CHF 1.1935 level and was supported around the CHF 1.1835 level.  Swiss National Bank yesterday reduced interest rates to historic lows, taking the target rate for three-month Swiss franc Libor to 0.25% from 0.50%.  At the same time, SNB announced it will intervene in the exchange rate market to stop the Swiss franc’s appreciation.  Foreign investors also purchased a Swiss franc bond issue and this led to increased selling pressure on the franc.  SNB is clearly trying to contend with the Swiss domestic economic slowdown by making its exports cheaper to the European Union, particularly Germany.  Critics suggest this amounts to a “beggar-thy-neighbour” policy that could precipitate inflationary pressures in Switzerland.  Data released in Switzerland today saw February producer and import pritces fall 0.6% m/m and 1.8% y/y.  U.S. dollar offers are cited around the CHF 1.1585 level.  The euro and British pound moved higher vis-à-vis the Swiss franc as the crosses tested offers around the CHF 1.5400 and CHF 1.6735 levels, respectively.

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 finance ministers and central bankers from the top 20 industrialized nations are set to begin another economic summit today in which a multitude of recent concerns about the economy will likely be addressed. These meetings, which can last days, have an indirect impact on the market and decisions reached during its meetings are typically implemented at a much later date. It is important for forex traders to follow any statements made regarding stimulus packages and interest rate cuts, however, as these will offer insight into future monetary policy decisions by the central banks.

Economic News

USD – Dollar Moves on Stock Market Gains

The Dollar recorded an extremely volatile session yesterday as the American stock market made massive gains on Thursday. The Dow Jones climbed an impressive 240 points, or 3.5%.This was owed to a number of diverse factors, such as General Electric revealing that losing its AAA rating won’t hurt the company, General Motors stating that it won’t need government loans this month, and better-than-expected retail sales figures helped push-up stocks too. This led the Dollar to make big moves against its major currency crosses. Against some currencies it made gains, and against others, like the EUR, it recorded heavy losses.

The Dollar dropped 100 points against the EUR to close down at 1.2924 in yesterday’s trading, as investors decided to take some riskier assets. The Dollar also made losses against the Pound. This is more likely to be a correction in the pair, as the Pound has lost a lot of ground against the greenback as of late. The British currency gained 50 points against the USD to close at 1.3918. The Dollar, however, recorded a 150 point gain vs. the Yen as it closed at 97.63.

Other news owing to the bullish U.S. stock market and the fall in the Dollar’s value against the EUR yesterday was Bank of America, JP Morgan, and Citigroup reporting impressive figures, leading to more risk taking yesterday. If the trend continues, this will mark a turning point in the current recession. In turn, this would mean a lot for the forex market. Thus, investors would abandon the current safe-haven Dollar en masse and return to currencies such as the GBP and EUR. However, to be safe, the global economic situation should only be judged on a daily basis.

Today, we have some important economic data releases coming out of the U.S. before the weekend kicks in. There are the U.S. Trade Balance figures at 12:30 GMT and the Preliminary University of Michigan (UoM) Consumer Sentiment report at 13:55 GMT. Better-than-expected figures may push the EUR/USD rate up to the 1.3000 level by Friday’s close. It is also advisable for traders to pay close attention to whether the Euro-Zone will reveal whether or not they will make rate cuts close to 0% in the coming months.

EUR – EUR Gains against Major Currencies

The EUR made notable gains against all of its major currency pairs in Thursday’s trading. This comes about as the stock markets of the Euro-Zone made similar gains, much inspired by the rally on Wall Street. There was also a leap in confidence yesterday, as President of the European Central Bank (ECB), Jean-Claude Trichet, revealed that he will be very aggressive at tackling the economic crisis, more than many analysts had originally forecasted.

Trichet revealed that he plans on cutting the overnight lending rate to 0.5%. In the short-term, this has resulted in an increase in demand for the European currency. This recent news is likely to lead to much volatility in the coming weeks between the EUR and its main currency pairs and crosses.

The EUR gained 40 points against the British Pound in yesterday’s trading to close at 0.9284. It nearly gained 300 points vs. the JPY to close at 126.24. This result is also owed to the stock market rally in Japan and the poor Japanese GDP figures, showing that Japan’s economy shrunk by 3.2% in the 4th quarter of 2008, the worst figures since 1974. Against the Dollar, the EUR rose 100 points to 1.2924, as investors took up riskier assets.

Looking ahead to today, there is some important news coming out of the Euro-Zone. The German Wholesale Price Index (WPI) will be released at 7:00 GMT, and the Retail Sales figures are set to be released at 10:00 GMT. If these figures match expectations, the EUR is likely to build on yesterday’s gains against its major currency pairs. There may be other factor’s affecting the EUR’s strength later today, such as investors profiting from current market conditions ahead of the weekend.

JPY – JPY Slides on Poor GDP Data and Stock Market Rally

The JPY slid in Thursday’s trading owing to 2 factors. First, the recent publication of Japan’s poor GDP figures showing that her economy shrunk by 3.2% in the 4th quarter of 2008, the sharpest fall since 1974. The second factor that led to the very weak Yen yesterday was the stock market rally in Japan, inspired by Wall Street. The Nikkei rose by over 300 points, or 4%, as investors dropped the safe-haven Yen. Shares such as Sony, Canon, and Japan’s banking sector made notable gains. This was the push that Japan needed to show that there may be light at the end of the tunnel. Maybe we are seeing a turnaround in economic fortunes for Japan?

The JPY made large losses against its major currency crosses. Against the Dollar, the Japanese currency fell by 150 points to close at 97.63. The JPY dropped a massive 300 points vs. the EUR, as there was renewed confidence yesterday due to the Euro-Zone’s fiscal policy, and the move away from less risky assets. The Pound also gained against the JPY by 250 points to finish yesterday’s trading session at 135.93, reversing losses that the Pound made in recent days. Revised Industrial Production and Household Confidence figures may determine the JPY’s strength in early trading today. However, as the day goes on, the Yen will be impacted more and more by developments coming out of the U.S. and the Euro-Zone.

Oil – Crude Oil Prices Soar $4 Higher

The price of Crude Oil for April delivery soared a dramatic $4 a barrel in Thursday’s trading to $46.60. This comes about as ministers from the Organization for Petroleum Exporting Countries (OPEC) are set to meet this coming Sunday. Officials in Saudi Arabia and Libya revealed that there may be a decision on further production cuts at their next meeting. However, ministers from OPEC failed to go into detail. There is concern, however, about the destabilizing economic situation on Oil prices.

Throughout this week, Oil prices have continued to be volatile as the upcoming meeting for OPEC in Vienna approaches. On Wednesday, for example, Crude prices dropped dramatically, after a higher-than-forecasted storage of Oil that was published in the Crude Oil Inventories report in the U.S. It seems that these losses have now been overcome. We will have to wait until Sunday’s meeting for the surprises that OPEC’s oil ministers have for us.

Technical News

EUR/USD

The recent bullish trend is losing its steam and the pair seems to be consolidating around the 1.29 level. The hourly chart’s RSI is already floating in the over-bought territory suggesting that the upward trend may see a bearish correction soon. When the downwards breach occurs, going short with tight stops appears to be the preferable strategy.

GBP/USD

The 4-hour chart is showing mixed signals with its RSI fluctuating in neutral territory. However, the daily chart’s RSI is sitting near the bottom border, suggesting that the possible next move might be a bullish one. When the upwards breach occurs, going long with tight stops appears to be preferable strategy.

USD/JPY

The typical range-trading on the hourly chart continues. Both the hourly RSI and Slow Stochastic are floating in neutral territory. However, the pair currently sits near the bottom border of the 4-hour chart’s RSI, suggesting an upward correction may be imminent. When the upwards breach occurs, going long with tight stops appears to be preferable strategy.

USD/CHF

The daily chart is showing mixed signals with its Slow Stochastic fluctuating in neutral territory. However, a fresh bearish cross on the hourly chart’s Slow Stochastic implies that a downwards correction might take place in the nearest time frame. When the downwards breach occurs, going short with tight stops appears to be preferable strategy.

The Wild Card – Crude Oil

Crude Oil prices rose significantly yesterday and peaked at $46.50 a barrel. However, the hourly chart’s RSI is floating in the over-bought territory, suggesting that the recent upwards trend is losing steam and a bearish correction may be impending. This might be a good opportunity for forex traders to enter the new trend at a very early stage.

Market Analysis provided by Forex Yard.

© 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 Adam Hewison

For the first time since September of 2007, the crude oil (NYME_CL) market has flashed a positive signal that it is headed higher. This is the first buy signal that we have seen in over 18 months in the energy markets.

The big question is, if crude oil is headed higher, how much of a price increase can the US economy afford and withstand? Find out here:

Go to the video…

Here is a raw commodity that is used by everyone and the US has no control over. This key commodity to commerce just happens to be in areas that are normally hostile to the US. If we see a hiccup in the supply chain that changes this market dynamic, even for a short time period, we could see oil move back to the $80/barrel range in a heart beat.

So how will this affect the US equity markets? If crude oil heads back to the $75-$80 range, I expect that the major indices will head south. I call it the 551 syndrome. 5000 on the Dow, 500 on the S&P 500, and finally 1000 on the NASDAQ.

In this short video I will share with you the potential target zones we could see in the next 6 to 12 months in crude oil.

See the Video here…

So with the trend in crude oil in a positive trajectory and the trend in the US equity markets in a negative trajectory, I think the two will feed off themselves. Look for traders and hedge funds to move aggressively in both these areas with abandon.

Lastly with no reinstatement of the up-tick rule, expect stocks to once again get pummeled to oblivion.

Enjoy the video and all the best in trading,

Adam Hewison
President, INO.com
Co-founder, MarketClub

Today’s forex market action was event filled with major news coming out of Switzerland, Australia and the United States. First up, Australia’s unemployment rate increased more than expected in February at 5.2 percent versus the expectation of 5.0 percent according to a report by the Australian Bureau of Statistics. Despite the bump up in rate, Australian employment increased by 1,800 jobs in February and surpassed market forecasts that were expecting jobs would fall by 20,000 workers.

Swiss cut interest rate, makes currency intervention in forex market.

Switzerland today decided to reduce its interest rate by 25 basis points as expected to bring the rate down from 0.50 percent to 0.25 percent. The rate cut sets a new all-time low for the Swiss National Bank interest rate level. The SNB also announced that it would intervene in the forex market to keep the Swiss franc from appreciating to help prevent the effects of deflation. The SNB statement explained that the bank will be “acting to prevent any further appreciation of the Swiss franc against the euro. To this end, it will increase liquidity substantially by engaging in additional repo operations, buying Swiss franc bonds issued by private sector borrowers and purchasing foreign currency on the foreign exchange markets.”

The Swiss franc fell sharply following the bank announcement and trading substantially lower all day versus the major currencies.

US News – Stocks rise, Retail Sales fall, Bernie Madoff pleads guilty.

Out of the United States today, the Dow Jones Industrial Average gained for the third consecutive day with an increase of 239 points(+3.46%) to creep back over the 7,000 barrier. The Nasdaq increased by 54 points(+3.97%) while the S&P500 gained almost 30 points(+4.07%).

US retail sales fell less than expected in February with a decline of 0.1 percent for the month compared to an expected 0.5 percent fall according to a report by the US Commerce Department. January’s retail sales were revised upwards from a 1.0 percent rise to a 1.8 percent increase. Core sales or retail sales minus automobiles registered an increase of 0.6 percent in February following January’s revised 1.6 percent core sales. Forecasts expected core retail sales to decline by 0.1 percent.

The US dollar has fallen in forex trading today versus the other major currencies with the exceptions of the Japanese yen and Swiss franc. The euro gained versus the dollar to reach a high today a 1.2945 dollars per euro in US afternoon trading while the British pound today reached a high of 1.3984 before giving back some of its gains. The Australian, New Zealand and Canadian dollars also made considerable gains versus the American currency.

Also of note, Bernie Madoff pleaded guilty today to 11 criminal counts of defrauding investors in the largest Ponzi scam in history. Madoff had his bail revoked and now is jailed as the judge now deemed him a flight risk.

Have you ever seen someone make a mistake and not only do they suffer for it but someone else does as a result also? Well, this is exactly what’s happening to Canada right now.

You see, most of last year, you could say that the Canadian dollar was falling because of falling commodity prices. Since Canada exports so many widely used commodities like oil and lumber, when prices fall, so do their profit margins. It costs them about the same amount to produce the product but what they can get for it in the market is determined by where those commodities are trading at the time.

USD/CAD Pushes Towards 1.30 Once Again!

Last Year the Commodities Crash Killed the Canadian dollar. This Year it’s the U.S. Economic Crash that’s Killing Them!

So that was what hurt them much of last year. Now we roll into 2009, and they get killed by another dynamic: the increasing slowdown of the U.S. economy!

For three months in a row now, the U.S. economy has shed around 600,000 jobs or more back to back! The unemployment rate seems to be going somewhat parabolic at this point. It jumped from 7.6% previously to 8.1% now.

On top of this, to buffer the blow of the slowdown, Canada’s central bank had to lower interest rates once again (to 0.50%) which put it at the lowest their interest rates have EVER been!

While this is a dynamic that will eventually be good for their economy, it hurts their currency right now for sure.

They also stated that they may implore “Quantitative Easing”. What the heck is that? Well, in simple terms it means that they will print money out of thin air and load up the banks with so much excess cash that they are more likely to lend money and thus spur economic growth.

While that may eventually give their economy a boost, it kills their currency. Why? Look at it this way. Anytime something becomes more abundant, it becomes worth less. Anytime something becomes scarce, it becomes more valuable. (This is why a Corvette in the 1960’s may have gone for $3,000 then and would sell for $30,000 to $60,000 today. These days, they are scarce…yet they weren’t back then).

So when the market is flooded with more money (Canadian dollars), that money gets devalued and is worth less. Therefore it takes more (Canadian) dollars to buy the same amount of goods.

The U.S. is Printing Money too, but Right Now they are Saved Because they are the World’s Reserve Currency (and thus a “Safe Haven”).

Now, you may say but isn’t the U.S. doing the same thing? After all, their economy is slowing down. They are printing money too.

I would say, while I won’t deny that point, the U.S. dollar presently benefits from what is called the “safe haven bid”. What does that mean? It means that investors all over the globe are running to the safety of the U.S. dollar because it’s the world’s reserve currency right now.

In other words, if there’s one currency on the face of the earth that you are most likely to keep and continue to use, it’s the one that most of the goods are priced in all over the world. For example, gold, oil, wheat, soybeans, lumber, etc. are all priced in U.S. dollars.

Therefore in crazy times like this, it enjoys the benefit of being the world’s reserve currency. However, once the global economy finally does return to normal, then this “benefit” will suddenly go away and the dollar will just have to stand on its own fundamentals once again. We all know that once that happens, the buck doesn’t have that much to stand on. Therefore, the “dollar party” may come to an end ONCE the global economy normalizes.

In the mean time, Canada’s currency (and economy) will continue to suffer as the U.S. lays off more workers and continues to slow down. Remember, they derive about 79% of their exports from the U.S. That’s huge! In fact, it’s so huge…it’s the largest trading relationship between two countries according to Canada’s trade department.

This really is huge, because the U.S. hasn’t had three back to back months of layoffs this big since they started keeping records on it back in 1939. So from at least as far as our records go back, this has never happened on this scale before!

So when you add all of this up, you come up with the fact that the U.S. dollar has a high probability of continuing to rise against the Canadian dollar. So with that said, I think you may find the USD/CAD rate to break the 1.30 barrier in the coming weeks to months.

Therefore, if you would like to take advantage of this situation and profit from the pressure on the Canadian dollar, then take these three steps:

1. Get Educated about Currencies and What Makes them go up and down: You can get your $19.99 online education here that comes with LIVE instructors that are there to answer your personalized questions AND comes with a money back guarantee if you are not satisfied.

1. Get a FREE demo account here that comes with REAL TIME quotes and charts. This way you can learn how to place trades before risking one cent of your money in the currency market.

1. Then once you’ve gotten educated over the course of 8-10 days in your course and you are familiar with your demo trading station, then open up your live trading account here. If you start with a micro account, then I would suggest putting in $300 to $2,000 in the account. Start small. If you choose to start with a mini account, then you might fund your live account with $2,000 to $10,000. Start with enough capital to be practical while trading only 1-2 lots per trade at first.

Bonus: See where to invest NOW, even in these tough economic times by clicking here.

Sean Hyman

Head Course Instructor

http://www.mywealth.com

By GCI Fx Research

€

The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.2730 level and was capped around the $1.2870 level.  European Central Bank President Trichet reported the current main refinancing rate target is “at a very, very low level” but intimated rates could go lower. Trichet added “It is absolutely clear that the present year will be a year of recession in a large number of countries. It is the same in most industrialized economies. It is in the projections of most economists, whether public or private, that in the course of 2010, starting from a very low level, because it is clear that 2009 is a year of deep slowing down, that we will progressively see a pickup.”  Other ECB officials have recently suggested rates could even move lower from their current all-time lows.  Also, German January industrial output fell 7.5% m/m, the largest decline on record, and was off 19.3% y/y.  EMU-16 January producer price inflation was off 0.8% m/m and 0.5% y/y.  In U.S. news, January business inventories declined 1.1% m/m and February headline retail sales were off 0.1% last month, better-than-expected.  Also, January retail sales were upwardly revised to +1.8% from the preliminary 1.0% level.  Additionally, weekly initial jobless claims rose 9,000 to 654,000 while continuing jobless claims surged to 5.317 million, the highest level since at least 1967.  Euro bids are cited around the US$ 1.2385 level.

¥/ CNY

The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥98.50 level and was supported around the ¥95.65 level.  Data released in Japan overnight saw gross real gross domestic product for October – December upwardly revised to -3.2% q/q from the preliminary -3.3% print.  This will likely result in a larger contraction to gross domestic product data in the current January – March period.  Japan’s fiscal year-end concludes at the end of this month and its economy is suffering from strong deflationary pressures, negative growth, and a current account surplus that recently turned negative – traditionally one of Japan’s strong suits.  The annualized contraction in October – December 2008 printed at -12.7%.  The Nikkei 225 stock index lost 2.41% to close at ¥7,198.25.  U.S. dollar offers are cited around the ¥104.15 level.  The euro moved higher vis-à-vis the yen as the single currency tested offers around the ¥125.55 level and was supported around the ¥122.10 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥135.50 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥81.30 level.  The Chinese yuan appreciated vis-à-vis the U.S. dollar as the greenback closed at CNY 6.8383 in the over-the-counter market, down from CNY 6.8399.  Data released in China overnight saw January – February industrial output up 3.8% y/y.

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.

By Donald Ogilve

The Forex Market is huge. Everyone says that, but it is difficult to understand the sheer scope of it. Over 3 trillion dollars traded everyday. That is an obscene amount of money. it belongs more in the realm of fantasy than in real life. The Forex market is also the largest when we talk about average daily turnover per trader. All this is even more impressive when you factor in the fact that there are more players in the Forex Market than any other in world. So, who are these fellas? Well, in general, we will go over some of the majors.

Let’s start with the Banks. You didn’t think they only did saving and lending, did you? It’s a wonder we still call them banks. They are involved in all kinds of things these days. Banks are one of the major leaguers in Forex. Some banks trade several billions of cold hard cash…well electronically mostly…everyday. They sometimes enter trades for clients, but the bulk of it is self-motivated. Commercial Companies are not quite as affluent as the banks. Nevertheless, they do their fair share. Sometimes, they generate enough volume to impact the direction of exchange rates. Central Banks are quite powerful as members of the Foreign Exchange Market. They have significant abilities to influence currency supply, interest rates etc. Central banks for countries have “ideas” about how much theur currency should be worth. If things go too far against them, they can take some action to try and influence the markets e.g. by using currency reserves to trade in huge volumes to raise the value of a currency. There’s a lot of this “intervention” going on now that we have a global recession. They are a sinister group.

We then have the Investment Management Firms. They basically pool a bunch of client finances together and play the market in some way. They tend to use the Forex Market to gain access to foreign Exchange, perhaps to purchase assets in another country. Since this sort of investment happens a lot, they do contribute significant volume to the trades. Think Bernie Madoff…or maybe not, since it turned out he wasn’t really doing much investing after all. Then you have Retail Forex Brokers. These are the good folks you open your Forex trading Account with, and who take the opposite position to you when you enter a trade. Lovely guys. They vary greatly in size and volume of trade, but together contribute something like 2% to market volume.

Then you have me, the little individual Forex Retail Trader. A mere drop in an ocean. We barely make a dent on volumes. Apparently, 95% of us trade at a loss. However, we are a relentless bunch. Most of us realize that the opportunity to get involved can be leveraged to make good profits. We may not have the volume, but we don’t care. We are the new kid at school, finally given the opportunity to make something of ourselves.

There’s room for everyone here. Just know your place.

About the Author

Donald Ogilve is a Part-Time Forex Trader. To learn more about making money Forex Trading an hour a day visit Donald Ogilve’s Blog at ForexInitiate.com.

Source: ForexYard

During yesterday’s early afternoon hours, Crude Oil received a hasty sell-off when investors unwound their positions for riskier assets. With a recent boost to equity markets, the USD has also found itself losing strength to a number of its currency rivals, particularly the EUR. If this stock rally can continue, we may see these trends persist throughout the rest of the week.

Economic News

USD – Equity Gains Reduce Demand for the Dollar

The USD traded significantly lower yesterday against most of its major crosses. The heavy selling of the Dollar continued for the second day in a row as a rise in risk-taking was seen when global equity markets rose from a 12-year low. However, when U.S. equity markets began to drop in the late afternoon, the Dollar showed a bit of strength, though it was not enough to counter the influx of additional risk taking.

U.S. equities made their largest gains of the year two days ago, spurring the selling of the Dollar. Positive market sentiment will hurt the USD. This has been a leading trend in the forex market; a reverse correlation between the USD and a higher level of risk.

The EUR/USD rose to a session high of 1.2862 from yesterday’s closing price of 1.2666. The GBP/USD also was higher at 1.3837 from 1.3789.

The USD may to continue to show weakness in the short-term. Economic forecasts for both U.S. unemployment numbers and retail sales are grim. The economic indicators are set to be released today at 12:30 GMT. While these two reports may make a big impact on today’s trading, the indicators are lagging. Therefore, traders should not forget about the monthly Business Inventories. This data may shed a better light on U.S. economic trends. If the report misses forecasts, the EUR/USD may return to the 1.3000 mark.

EUR – German Manufacturing Data Plummets

A report released yesterday showed that German manufacturing orders tumbled in the month of January as the global economic slowdown took its toll on Germany’s exports. The manufacturing industry saw orders plunge 8% in the month of January. The mark was more than 4 times below the forecasted value by global economists.

It is apparent that the global recession is having a catastrophic effect on the German economy. As other nations slope into a recession, Germany’s reliance on exports to fuel their economy has triggered a massive slowdown. Germany is the European Union’s largest economy and many view it as a gauge for pan-European economic performance. These reports could begin to impact the trading of the EUR.

Traders will be anxiously expecting monthly German Industrial Production figures today. The report may not be the one to set the trend for today’s EUR trading, however high price volatility will be expected during the time of the report’s release. Forex traders may want to look for a continuation of poor manufacturing data from Germany to perhaps sink the EUR during inter-day trading.

JPY – Better GDP Numbers Helps the Yen Rise

The JPY gained strength for the second day in a row and continued its gains into the Japanese trading session. The release of Japanese Final GDP came out better than expected. This helped to increase the bullishness of the JPY. The USD/JPY was trading lower near the 96.20 level early this morning.

The updated 4th quarter GDP numbers were greeted with cheers. Japan’s economy has been one of the most negatively impacted economies during the global recession. Any sign of positive news could provide a boost to the Yen which has seen considerable weakness the past month. Traders may want to run with the bullish correction of the JPY today as this may continue with the release of poor U.S. economic indicators later today.

Oil – Higher than Expected Inventory Data Sinks Crude

The price of Crude Oil dropped sharply yesterday as the demand for the commodity continues to fall. U.S. Crude Oil inventories posted a sharp increase in the amount of Crude stocks in storage. The report failed to meet market expectations, helping to drive the price of Crude lower. At the end of the trading day, the price of Crude Oil held at $42.64. The price was down more than $3 on the day.

The lack of any price appreciation has market participants forecasting further production cuts by OPEC later this month. The cartel is next scheduled to meet on March 15th. However some skepticism remains if more supply cuts will have any affect on current Crude prices due to bleak demand forecasts for global economic growth. Many see the fair market value of Crude Oil trading in the range of $45-$50.

Technical News

EUR/USD

The recent upswing seen in this currency pair has the price floating near the upper border of the Bollinger Bands on the 4-hour and daily charts, signaling moderate downward pressure. The recent bearish cross on the 4-hour chart’s Slow Stochastic adds weight to the notion of an imminent downward correction. Going short with tight stops might be a wise choice today.

GBP/USD

This currency pair is currently giving off mixed signals. With the RSI on the hourly chart showing the price floating in the over-bought territory, there may be a downward correction in the nearest future. However, with the price floating in the over-sold territory on the daily chart’s RSI, the longer-term movement will likely be in an upward direction. Capturing the imminent downward correction and then riding out the uptrend may be a wise strategy today.

USD/JPY

The price of this pair appears to be floating in the over-sold territory on the RSI of the hourly and 4-hour charts, indicating an upward correction to the recent downtrend may be imminent. There appears to be a bullish cross forming on the 4-hour chart’s Slow Stochastic which supports this notion. Going long might be a good choice today.

USD/CHF

This pair appears to be consolidating to the price level of 1.1575 in anticipation of a volatile movement. The Bollinger Bands on all charts appear to be tightening, which supports this notion. With the RSI on the hourly and 4-hour charts hovering close to the over-sold territory, the sharp movement may be in an upward direction. Going long might be a wise choice today.

The Wild Card – USD/SEK

After the recent drop in value, the price of this pair appears to now be floating in the over-sold territory on the RSI of both the hourly and 4-hour charts, signaling an upward correction may occur in the nearest future. The recent bullish crosses on the 4-hour chart’s Slow Stochastic heavily support this notion. As the Bollinger Bands on the hourly chart begin to tighten, a volatile upward correction may be occurring in today’s early trading hours. Forex traders can take advantage of this imminent volatile movement by setting an early long position with tight stops.

Market Analysis provided by Forex Yard.

© 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.