Electronic currency trading can be done with a click of a mouse but because of the speed at which transactions can be conducted market volatility has increased. It is not uncommon for a currency’s value to fluctuate several times in a 24 hour period.  Thanks to electronic currency trading investors can trade for large profits daily. Low transaction costs means that traders get to keep more of their earnings than in traditional stock and commodities markets. Dealing with market volatility will probably be the biggest challenge most forex traders will encounter.

Most retail forex brokers offer investors their own trading platforms and the software is easily downloaded. There are many websites that provide reviews of the various trading platforms available online. There are also automatic trading programs available but the effectiveness of these has not been clearly demonstrated and many software providers make outlandish claims.

Selecting a broker need not be a daunting task for those who want to enter the exciting world of electronic currency trading. Most reputable brokers will be members of the National Futures association (NFA) and will be registered and regulated by the Commodity Futures Trading Commission.(CFTC) In 2009 stricter regulations were imposed and as a result most of the questionable brokers are out of business. Electronic currency trading allows for the use of higher levels of leverage than those in stock and commodity markets. Leverage can be a double edged sword leading to huge profits but also huge losses if a trade goes bad. Electronic currency trading is one of the most exciting investment opportunities available to average investors and can add value to any portfolio.

Risk appetite is back with all the forex opportunity that a return to risk taking brings. The Yen fell against the dollar and other major currencies as US regulators announced plans to inject new capital into the US banking system and dismal economic data continues to come out of Japan.

Weaker Yen

Richard Franulovich of Westpac Banking Corp. stated, “There is an improvement in risk appetite today, and that’s filtered though in terms of dollar strength versus the yen. The yen is weaker off the back of improved sentiment on banking stocks and the potential for some government involvement.”

Forex brokers sought out higher yielding currencies and the Forex opportunity they provide investors.

Eastern European Central Banks Pledge Cooperation

The Polish zloty, Hungarian forint and Czech koruna rose against the troubled Euro as central banks in Eastern Europe promised to coordinate efforts to support their currencies. The Polish Zloty gained 4% against the Euro and investors were quick to take advantage of the forex opportunity this move offered investors. Polish central bank governor Slawomir Skrzypek stated that “an intensification of information exchange and coordination of action”

will assist regional Central Banks to support their respective currencies. The retreat from safe haven currencies is expected to boost Forex opportunities for several emerging currencies.

Return to Risk Aversion Predicted

Some forex brokers predict a return of risk aversion. Paresh Upadhyaya, senior vice president at Putnam Investments stated, “The dollar-yen seems to be following the yield spread. The recent yen weakness isn’t the start of a new trend. The yen is likely to strengthen in the second quarter because of continued uncertainty and risk aversion.”

The Euro fell after ECB President Jean-Claude Trichet stated that credit flows in the Euro Zone are declining.  While this latest return to risk appetite will probably be short lived savvy forex brokers will be quick to spot and take advantage of any Forex opportunities that present themselves. Hopefully future economic data will point to a recovery from the global recession.

Quick Forex Tip: The forex market offers investors the opportunity to profit even during a recession. If one currency rises another must fall creating constant opportunities for savvy investors to profit from currency moves. It is not difficult to learn how to trade forex currency and there are many very well written and user friendly learning programs and training courses available for free on the internet.  Besides training, the most important thing those who trade forex currencies must learn to follow political and economic news and interpret the results and the affect current events will have on forex markets.

The US dollar weakened slightly Monday February 9th amid uncertainties about the Obama administration’s financial stimulus package and bank rescue package. Treasury Secretary Timothy Geithner had planned to announce details of the plans on Monday but delayed his remarks until Tuesday leaving markets in limbo and limiting Forex opportunities.

Compromise Needed

The Obama administration is pressing legislators to settle their differences and agree on the much needed rescue plans. During the past few months the US dollar has provided both a safe haven and Forex opportunities for investors. The US is seen as very aggressive in addressing the economic crisis and most analysts believe that the US will be the first industrialized nation to recover from the global recession.

Geithner’s Delay Hurts Dollar

Throughout the crisis the US dollar has benefited from its safe haven status as has the Japanese Yen. Geithner’s delay in announcing the details of the plan has hurt the dollar and the Forex opportunities it provides. Omer Esiner, of Ruesch International stated, “I think it did highlight the troubles the Obama administration faces in finding non-partisan support for the stimulus package. And that has pressured the dollar.”

Elevated Risk Appetite

Last week saw elevated risk appetite and increased Forex opportunities. Economic data from the UK and the Euro Zone helped both the Euro and Pound to rise slightly for the first time in weeks. The Yen also was under pressure as investors sold off the Yen and took advantage of the Forex opportunities offered by higher yielding currencies. The Bank of England cut rates to a historic low which helped the troubled Pound in currency markets.

Tuesday will be a busy day for forex trading. On Tuesday the details of the US’s economic rescue plan will be announced. Currency markets will respond and investors will be watching for Forex investment opportunities related to Geithner’s remarks.

Quick Forex Tip: Euro currency trading requires a lot of research and investors must keep track of economic information from the twelve member nations. The economy of just one nation can affect the euro’s exchange rate.  In 2010 political uncertainty and deficit concerns about Greece caused the euro to fall considerably in global forex markets. Euro currency trading can be exciting and very lucrative for investors who have done their homework.

The Japanese Yen rose on Thursday as risk aversion returned due to negative economic data from the United States and falling share prices caused investors to take advantage of the safe haven Forex opportunity that the Yen provides. Recently released data showed that US orders for items such as computers and appliances fell by a larger than expected 2.6% in December causing concerns about the state of the global economy. A separate report showed that Americans filing for first time unemployment also rose.

Yen Offers Safe Haven

Recent economic developments have limited Forex investment opportunity and many Forex brokers and traders are seeking the safe haven that the dollar and the Yen traditionally provide in a down economy. The US House of Representatives passed the $825 billion economic stimulus package proposed by the Obama administration but even the passage of the package failed to calm investor concerns. The bill was passed without one Republican vote and now has to clear the Senate.

ECB to Cut Rates

The Euro fell slightly after European Central Bank President Jean-Claude Trichet told CNN that the central bank could cut rates below the current 2%. He also stated that the bank may try some original and unconventional measures to help the troubled Euro Zone economy. Adarsh Sinha of Barclays in London stated, “A lot of people thought that the ECB was ruling out quantitative easing, but Trichet’s comments suggest otherwise.”

Euro Zone Data Negative

The Euro has provided minimal Forex opportunity during the current crisis. There has been nothing but bad news coming from the Euro Zone lately. German unemployment figures showed the biggest gains in four years and Euro Zone economic sentiment is at its lowest since 1985. Obviously the Euro offers limited Forex investment opportunity at best.

For months global economic news has been dreadful. Both stock and Forex markets have been unstable but somehow traders seem to find Forex opportunities when they occur. The coming year promises to be an interesting one!

Quick Forex Tip: Political conditions play a major role in global currency trading. Political instability can cause a currency to lose value. Recently political problems and deficit concerns in Greece caused the euro to fall in global currency trading centers. Market psychology although difficult to define can also affect market perceptions and can either help or pressure currencies.

Leverage is the ratio of the invested amount versus the trade’

s actual value and leverage can help the trader increase Forex opportunities while investing. Forex brokers usually provide their clients with the option to trade with borrowed capital which can greatly increase the value of whatever trades are made.

If a Forex trader is trading with a ratio of 1:100 or X100 that means that for every dollar invested the broker invests $100. If the client invests $100 they will control a trade of $10,000. Obviously this increases the trader’

s Forex opportunities but it also increases the risk involved. Slight fluctuations can cause a trader to either gain significantly or lose very quickly.

Currency fluctuations are measured in pips, which is the smallest change in currency price and could be the second or fourth decimal place of a price depending on the currency pair. This is why it is necessary to trade in large amounts using leverage and increasing the trader’

s Forex opportunities. When dealing with large amounts of currency like $100,000 (a standard lot) minute changes can produce significant profits.

It is wise to use leverage cautiously. Beginners are cautioned against using excessive leverage until a thorough knowledge of how currency markets work and how to take advantage of Forex opportunities when they occur has been achieved.

Quick Forex Tip: Political conditions play a major role in global currency trading. Political instability can cause a currency to lose value. Recently political problems and deficit concerns in Greece caused the euro to fall in global currency trading centers. Market psychology although difficult to define can also affect market perceptions and can either help or pressure currencies.

Some economists are predicting that because of a deepening recession and low interest rates the dollar could see a sharp decline on Forex markets in 2009. Recently risk aversion and de-leveraging has helped to prop up the dollar and provided many with Forex opportunity.

Dollars Gain Artificial

The dollar has gained 20% against major currencies since July but many see the gain as artificial and predict a correction once extreme risk aversion eases and global markets stabilize themselves. Bob Sinche, head of global FX and rate strategy at The Bank of America in New York stated, “Foundations for the dollar’s recent rally have not been solid. The result of repatriation, deleveraging, quantitative easing and a major scarcity of dollars. But now we are bound for a correction.”

Mr. Sinche also predicted that the dollar could be trading at 1.38 by the end of December and could go as low as 1.44 to the euro by the first quarter of 2009. Of course the shift will provide savvy investors with Forex opportunities.

Risk Aversion Easing

Goldman Sachs strategist Abby Joseph Cohen stated that the dollar is now at the level it should be. Some experts see extreme risk aversion easing and combined with low interest rates and a declining economy could put downward pressure on the dollar. Most currency strategists in a Reuter’

s poll released on Wednesday said they expect volatility in the euro, sterling and yen against the dollar to decrease in the next few weeks. This shift could provide increased Forex opportunity for those who know how to invest in volatile markets.

Dollar Providing Safe Haven and Forex Opportunity

2009 promises to be an interesting year for Forex markets. The levitating act of the US dollar has provided many investors with a safe place to park their money and still provides plenty of Forex opportunity. How much longer this will last is anybody’

Quick Forex Tip: Euro currency trading requires a lot of research and investors must keep track of economic information from the twelve member nations. The economy of just one nation can affect the euro’s exchange rate.  In 2010 political uncertainty and deficit concerns about Greece caused the euro to fall considerably in global forex markets. Euro currency trading can be exciting and very lucrative for investors who have done their homework.

s guess.

Lately global economic news has been unpleasant to say the least. Every day there are news reports of more job losses in the US and Europe and retail sales are at an all time low. Despite the denial from politicians it is clear that the world is entering a recession.

Germany in Recession

Germany is officially in a recession and China’s industry output growth is the lowest in seven years. The Organization for Economic Cooperation and Development has predicted a recession for the Eurozone, Japan, and the US. The worst economic crisis since the great depression is taking its toll and limiting growth and forex opportunities.

Economists Predict Deepening Recession

Economists are forecasting a grim future for the global economy. Carsten Brzeski of ING Financial Markets stated, “The headwinds of the financial crisis and the global economic slowdown are blowing right in the face of the German economy. Even more worrying, the full impact of the financial crisis still has to unfold. If you think today’s numbers are already bad, just wait for the next quarter.” Investors are facing grim market conditions and Forex opportunities could be severely limited.

Massive Job Losses in the US and UK

Because of the economic crisis workers worldwide face massive layoffs and permanent job losses. The US has lost approximately 250,000 jobs so far this year and there are daily reports of more job losses across the country. In the UK British telecoms company BT Group BT. said it was cutting 10,000 jobs at home and overseas.

Obama Suggests Stimulus Plan For US

The Organization for Economic Cooperation and Development has suggested that it was time for more governments to provide an extra boost to their economies in the form of fiscal stimulus in the form of tax cuts or increased government spending. President elect Barack Obama has suggested another stimulus plan and is also proposing a bailout for the ailing US auto industry. Germany is expected to give its economy a 50 billion Euro boost.

$4.6 Trillion Worldwide For Bailouts

Governments around the world have already pledged around $4.6 trillion for bank bailouts, credit guarantees and fiscal spending to mitigate the damage from the financial turmoil. Most experts agree that recession like conditions will be with us well into 2009. At present the US dollar is performing amazingly well on currency markets and is still providing investors with a safe haven and Forex opportunities but is unclear just how long this will last.

G 20 Summit Could Provide Forex Opportunity

This weekend leaders from around the world will meet in Washington at what has been billed as an economic summit. Despite the differences between nations it is hoped that a spirit of cooperation will prevail and that the world can begin to recover from this crisis. In the mean time investors can still take advantage of Forex opportunities not found in other markets.

Quick Forex Tip: There are many factors that affect currency exchange rates and those who want to trade forex markets should be familiar with them. Economic factors are probably the most important in determining the value of a currency. Political conditions can also affect exchange rates. Those who want to trade forex markets would be well advised to keep abreast of current political and economic events. Thanks to the internet, those with the right knowledge and an internet connection can join this exciting market and take advantage of the lucrative opportunities it can provide for investors.

]]> http://www.forexopportunity.net/2008/11/more-bad-news/feed/ http://www.forexopportunity.net/2008/10/the-november-summit/ http://www.forexopportunity.net/2008/10/the-november-summit/#comments Thu, 23 Oct 2008 18:54:20 +0000 admin http://www.forexopportunity.net/?p=99 Bush Will Host Meeting Of World Leaders To Address Crisis

On November 15^th US President George Bush will host a gathering of world leaders to address the current global financial crisis. There has been resentment in some quarters with many blaming the US for the financial meltdown. The crisis started in the US with the sub prime mortgage crisis and quickly spread to the whole US economy and ultimately resulted in a $700 billion dollar bailout of financial institutions. Credit markets froze and interbank lending ceased and businesses found themselves unable to obtain loans for day to day operations. Despite the performance of world stock markets, investors large and small have been able to take advantage of the many Forex opportunities offered by currency exchanges.

Bush Agrees to Meeting Under Pressure

Governments in both Europe and the United States have thrown billions of dollars at the crisis hoping to avoid a worldwide recession, calm volatile stock markets, and thaw frozen credit markets. Under pressure from European allies President Bush agreed to host the first in a series of meetings to address the economic crisis. The leaders will discuss progress made addressing the crisis, analyze its causes, and develop policies and reforms to prevent similar events in the future.

Meeting Includes G20 and Emerging Nations

Those invited are leaders of the G20, which includes the Group of Seven major industrialized nations and key emerging economies like China, Brazil, Saudi Arabia and India. Also invited are leaders from the International Monetary Fund, The World Bank, and Financial Stability Forum. White House spokeswoman Dana Perino said, “Everybody will come with their ideas and the president recognizes that every country is going to have a responsibility but not every country is going to have the same solution.” Bush will host a dinner the evening before the conference but at present no venue has been announced.

Bush Will Seek Input From Presidential Election Winner

The summit will take place 11 days after the US presidential election and the White House has indicated that they will seek input from the winner of the election. In a statement Obama said, “America must lead and other nations must be part of the solution too.” McCain also expressed support for the conference stating that the conference is, “an important opportunity to take urgent steps to recovery and prevention of similar crises in the future.”

Bush Meets With Sarkozy and Barroso

The announcement for the gathering happened four days after Bush conferred with French President Nicolas Sarkozy and European Commission President Jose Manuel Barroso. Sarkozy stated the meeting would be “followed by several others aimed at rebuilding the international financial system and making sure the current crisis does not happen again thanks to better regulation and more efficient surveillance of all players.”

Sarkozy Suggests Overhaul of International Financial Architecture

Sarkozy has been asking for a summit for weeks and has suggested an overhaul of the international financial architecture established at the 1944 Bretton Woods conference. The Bush administration has been somewhat resistant to an overhaul of the world system. Instead the Bush administration proposes freer markets, boosting trade and increasing flows of capital across borders. In a statement emphasizing his support of free markets Bush stated, “Anything that we do through this series of summits, I think we want to ensure that we don’t inhibit that kind of market activity, that we continue to see investment and that we continue to see increased trade.”

What happens at the conference could very well be determined by whoever wins the 2008 presidential election. In January there will be a new administration in Washington and as with every change of administration comes changes in policies. An Obama administration would probably be more open to increased regulation while a McCain administration would most likely support unfettered free markets. Since political events affect Forex Markets any political change in the United States is likely to produce unique Forex opportunities for those who have done their homework.

Dollar Could be Affected on Forex Markets

The series of summit meetings are sure to produce reforms and more cooperation between nations affected by the crisis. In the meantime the US dollar is strong on Forex markets trading high against the Euro and other major currencies. Changes in world monetary policies could easily make Forex markets as volatile as stock markets but will still offer investors Forex opportunities that other markets cannot match.

Quick Forex Tip: The forex market offers investors the opportunity to profit even during a recession. If one currency rises another must fall creating constant opportunities for savvy investors to profit from currency moves. It is not difficult to learn how to trade forex currency and there are many very well written and user friendly learning programs and training courses available for free on the internet.  Besides training, the most important thing those who trade forex currencies must learn to follow political and economic news and interpret the results and the affect current events will have on forex markets.

Lately the economic news from around the world has been, by and large, doom and gloom. The world is facing an economic crisis of unprecedented severity and governments around the globe are trying to stimulate the economy. Stock markets in the US, Europe, and Asia have been volatile to say the least.

Despite Economy US Dollar Performs Well

Despite the dismal state of the US economy the dollar has held steady and has actually increased against many world currencies on Forex markets. Analysts are at a loss to explain the performance of the US dollar which some have described as a ‘levitating act.’

For those in the US fortunate enough to have disposable income for travel the performance of the US dollar is offering the opportunities for bargain travel and is also offering investors Forex opportunities in currency exchanges worldwide.

Strong Dollar Good News For Travelers

For US travelers the strong dollar means bargain rates in several countries. In Mexico, for example, a year ago the dollar was worth 10.50 pesos. This year travelers can expect 12 to 13 Pesos for a dollar. Mexico is a popular destination for US travelers and has always offered moderately priced vacations and the strength of the dollar makes Mexico a real bargain for vacationers.

Bali A Real Bargain

The exotic island of Bali has always been popular with US travelers and offers incredibly cheap vacation opportunities. Due to the performance of the US dollar on Forex markets Bali will become even cheaper. The Indonesian Rupiah has continued to decline against the dollar. Last year the Rupiah traded for 9,073 Rupiah while this year it is trading for 10,000 Rupiah making Bali one of the least expensive destinations for those seeking an exotic vacation spot.

Iceland Incredible Value

Although most US travelers do not consider Iceland to be a vacation destination the country does have many interesting features. Iceland sits atop the mid Atlantic plate and has extensive geothermal activity. Icecaps and glaciers, spouting geysers, volcanoes, raging rivers and magnificent waterfalls, and whale watching are all part of an Icelandic vacation. The capital, Reykjavik’s, has many geothermal baths that have to be seen to be believed. Last year the Icelandic kronur traded at 60 against the dollar. This year a dollar will trade for 110 kronur for a dollar which means the dollar is worth almost twice as much as last year making Iceland extremely affordable.

Australia 50% Cheaper

For those considering a visit ‘down under’

current exchange rates make Australia a real bargain. As recently as six months ago the Australian dollar traded at par with the US dollar but is now trading for $1.40-$1.50 against the US dollar. Australia is now 40%-50% cheaper for the American tourist. Australia has amazing beaches, astounding wildlife, and hotels and other accommodations are considerably less expensive than their American counterparts.

While the Euro has declined 10% against the dollar the shift has not been enough to lower travel expenses and Europe remains incredibly expensive. In Canada the US dollar is worth $1.20 Canadian giving American tourists a 20% edge.

USD Doing Well on Forex

Unfortunately all this comes at a time when most Americans are tightening their belts and eliminating unnecessary expenses. America has been bleeding jobs for the past eight years and those who can afford a domestic vacation consider themselves fortunate. Hopefully the US dollar will continue to perform well in Forex exchanges until the economy recovers and we can all benefit from the strong dollar. The strong dollar offers travelers and investors Forex opportunities that are unprecedented.

Quick Forex Tip: Electronic currency trading offers many advantages to the average investor. Anyone can learn how to trade currencies by using one of the many excellent training programs available online for free. In addition many retail forex brokers provide potential investors with training programs and demo accounts. Electronic currency trading offers recession proof trading because in the currency market when one currency falls another rises giving the savvy trader the opportunity to profit from the move.