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2009-06-06T01:29:00.000-07:00

STOCKS: Buoyed by disinvestment hopes
PSU stocks. After being also-rans in the bull market from 2003 to 2007, listed PSUs saw a revival of interest after the 2009 election verdict. The BSE PSU index rose 39.5 per cent post-elections, beating the 24 per cent surge in the BSE-500 and ...

TECHNICAL ANALYSIS: Index Outlook — Air pockets ahead
Sensex treaded water in the early part of last week as the expiry of the May derivative contracts dominated proceedings. Fresh resolve displayed by the new (?) Cabinet to make a difference this time around, provided the impetus to help ...

STOCKS: Redington India: Buy
Investors with a two-year horizon may buy the shares of Redington India, an IT hardware and software ...

STOCKS: Tata Motors: Hold
Tata Motors is in a phase that cricket commentators would call consolidation — that is, the period where the side chasing runs rebuilds its innings after the fall of a couple of quick wickets. The company is slowly but surely picking up ...

STOCKS: Shriram Transport Finance Company: Buy
Fresh investments can be considered in the stock of Shriram Transport Finance Company (STFC), which is among the leading asset financing (commercial vehicle financing) NBFCs in ...

STOCKS: JK Lakshmi Cement: Buy
The stock of JK Lakshmi Cements looks an attractive buy in the mid-cap cement space at the current price of Rs 98. The stock trades at just three times its trailing four quarter earnings when some of its peers are at over six times ...

STOCKS: Welspun India (Rs 35.8): Buy
The structural down-trend from December 2004 peak in this stock halted at Rs 13 this February and a strong uptrend is in motion since ...

MUTUAL FUNDS: Birla Sun Life Frontline Equity Fund: Invest
Investors can consider buying the units of Birla Sunlife Frontline Equity Fund (Birla Frontline), given its long-term track record of delivering steady returns and ability to contain downsides during ...

MUTUAL FUNDS: Magnum Multiplier Plus 1993: Invest
Investors with a penchant for high risk can consider investments in Magnum Multiplier Plus. The fund has generated a compounded annualised return of 34 per cent over a five-year period and outpaced the benchmark BSE-100 by 10 percentage ...

MUTUAL FUNDS: Lumpsum still scores
In a volatile market.... In a highly volatile market, the SIP (systematic investment plan) is considered better than lumpsum investments. Mutual funds too advocate this method to weather volatile markets. But the numbers suggest a different ...

INVESTMENTS: How to climb out of debt trap
Debt is an important tool available to every individual who is keen to build his assets. Being in debt is not a bad thing as long as you are taking steps to pay it ...

FINANCIAL INSTITUTIONS: All about QIPs
With most funding routes closed, Qualified Institutional Placements or QIPs seem especially alluring at the ...

REAL ESTATE & CONSTRUCTION: Rebound in realty?
Nearly a year after the demand slowdown, the property market sentiments seem to be improving, according to real estate companies. Builders across the market segment are claiming that the last two months have witnessed a surge in bookings ...

REAL ESTATE & CONSTRUCTION: Harping on value for money
After the real estate meltdown, with the price differential between gated community projects and smaller private developers coming down, more and more new buyers are looking at gated ...

TECHNICAL ANALYSIS: Query Corner : What the charts say
I have purchased Praj Industries at Rs 75. Please advise whether to book profit or buy some more at current ...

REAL ESTATE & CONSTRUCTION: Where supply meets demand
One of the chief executives of a hospitality chain who visited Mangalore recently after a gap of three years, had one thing to say about the city — it now wears a different look. He attributed a host of developmental activities taken up ...

TECHNICAL ANALYSIS: Pivotals
RIL moved sideways in a narrow range before spurting to an intra week peak of Rs 2,304 on Friday. As indicated in our last column, the short-term trend in this stock is ...

TAXATION: Treatment of capital gains on sale of shares
I have three demat accounts and hold 375 shares of RPL, the details of which are as follows: Acquired on January 1, 2007- 100 shares with ICICI in ...

BOOKS: Killer home loans
In the new economy, wins are private affairs, and losses, public, bemoans Jon Jeter in Flat Broke in the Free Market: How Globalization Fleeced Working People ( ...

REAL ESTATE & CONSTRUCTION: Luxury mall in Chennai
Bergamo Luxury Mall, a shopping destination for the super rich, is set to open its doors in Chennai at Khader Nawaz ...

PSU: The line-up for disinvestment
By now, it is quite clear that the Government does have divestment of its stakes in PSUs high on its agenda for the next few months. That may well allow investors to buy into a whole range of offers from listed as well as new PSUs. Which ...

DERIVATIVES MARKETS: Nifty future may move higher, but caution advised
Defying gravity, the market continued to witness a firm trend. The Nifty June future closed the week at 4441 with a gain of 4.8 per cent over the previous week’s close of 4256.2. However, the June future closed at a discount of about ...

ECONOMICS: The strange case of bistromathics
It was yet another stressful wait at the airport last week. We all know the reason by now — “delay due to the late arrival of the incoming aircraft”. Why is it that flights as a rule do not take off on time? And what has ...

CORPORATE: Reading corporate actions
Crude oil prices, interest rates, corporate results — there are a plethora of factors that the stock market investor needs to track to make informed decisions about ...

INVESTMENTS: Target returns funds: Need for style-based tactical asset allocation strategy
Target returns fund appears to be finding favour among asset management firms. Prudential ICICI Mutual Fund launched one recently and reportedly has met with good investor response. Reliance Mutual Fund has filed a document with SEBI to offer ...

TECHNICAL ANALYSIS: Relative Strength Index
One of the most useful and popular momentum oscillators is the Relative Strength Index (RSI). It was developed by J. Welles Wilder and published in his book New Concepts in Technical Trading Systems in 1978. The RSI ...

STOCK MARKETS: Bull's Eye
E-mail your response before Tuesday ...

STOCK MARKETS: Baskets of X
E-mail your guess before Tuesday ...

MUTUAL FUNDS: Fund Talk
Please give your advice on my investments for a long-term horizon of 5 to 7 years. I have invested in small amounts in all schemes spread over a period of last 2.5 years even during the Sensex high of 21000 and during the lows of ...

NEW FUND OFFER: Update
Reliance Mutual Fund has launched a fund that will invest in infrastructure companies. Opportunities in the related sectors such as transport, banks and financial institutions, energy, power and oil, metals and minerals, ...

Forex reserves rise by $1.6 billion

2009-06-06T01:26:00.000-07:00

Mumbai, June 5 The rise in foreign currency reserves moderated during the week ended May 29. According to the Reserve Bank of India’s Weekly Statistical Supplement, foreign currency reserves increased by $1.667 billion to touch $262.306 billion.

In the pervious week, forex reserves had increased by $6.432 billion to touch $260.639 billion.

During the week under consideration, foreign currency assets increased by $1.291 billion to touch $251.456 billion. Foreign currency assets expressed in US dollar terms include the effect of appreciation/depreciation of non-US currencies like euro, sterling and yen held in reserves.

This was the week when the dollar gained against other global currencies like yen and euro. The euro weakened from $1.4023 at the beginning of the week to $1.3984 against the dollar.

Gold reserves increased by $373 million to touch $9.604 million. SDRs were unchanged at $1 million.

The country’s reserve tranche position in the IMF increased by $3 million to touch $1.245 billion.

Related Stories:
Forex reserves rise $6.432 b

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Europe shares extend losses; Porsche drops 4 pct

2009-05-25T15:07:00.000-07:00

FTSEurofirst 300 down 0.2 pct, falls for 3rd day in a row

* Porsche falls 4 pct, receives loan

* Arcandor drops 12.7 pct; CEO says co needs state aid

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Christoph Steitz

FRANKFURT, May 25 (Reuters) - European shares fell on Monday as Porsche led carmakers lower after Volkswagen said it gave a multi-million euro loan to its smaller German peer, while trade was thin with UK markets closed for a holiday.

Porsche (PSHG_p.DE: Quote, Profile, Research) fell 4 percent after the company confirmed media reports that it received a 700 million euro ($979.7 million) loan from Volkswagen (VOWG.DE: Quote, Profile, Research) to help with its finances.

At 1107 GMT, the FTSEurofirst 300 .FTEU3 index of top European shares was down 0.2 percent at 854.67 points, after edging higher in the first minutes of trading.

The index, up 2.8 percent on the year, has risen 32.4 percent since reaching a record low in early March, but the rally started to abate at the end of last week on growing concerns over mounting government debt.

Daily Forex Update - Carry Trade Liquidation

2009-05-25T15:04:00.000-07:00

Carry trade liquidation and a spike in volatility were the two major themes for the forex markets during the final trading session for the calendar year. Existing home sales and relative calm in central Asia helped the greenback recover some of last week's losses.

USD
As you can see in Figure 1, the U.S. dollar (purple) was the second-best performing major currency today behind only the Japanese yen. The drop in crude oil prices hurt the Canadian dollar. The loonie (light blue) was the worst performer against the greenback. The British pound (dark blue) started the N.Y. trading session as the big winner but finished in the middle of the pack due to carry trade liquidation.

Figure 1 - The Performance of the JPY Crosses during the Last 24 Hours

The Dow Jones Industrial Average dropped over 100 points reflecting a general bearish sentiment surrounding the outlook for the U.S. economy. The yield on the 10-year Treasury note inched closer to 4 percent - 25 basis points below the current Fed funds target rate. This discrepancy shows that bond traders are expecting the monetary policy setting board to drop the overnight cash loan rates another 25 basis points at the next meeting in January. But, despite these two seemingly bearish events for the greenback, the U.S. dollar had one of its best days of the year with most of its gains coming during the N.Y. trading session. The best news for the embattled currency was that Pakistan was able to avoid more turmoil over the weekend in the wake of the assassination of ones its popular political figures.

Another positive release for the greenback was today's surprisingly strong existing home sales report. The market was looking for a small month-over-month drop but investors were looking for a similar freefall that accompanied the new homes sales figures on Friday. Even though the monthly number was positive, the index still declined over 20 percent during the past twelve months. The annualized number of homes sold remains at its second-lowest number since the index began in 1999. Falling mortgage rates usually help boost the number of homes sold but drop in lending rates during the past few months has not helped sales move significantly higher. The median sale price did climb 1.6 percent for the month. Investors are keying on any positive data as they look for clues for the bottom in the housing market and ultimately the financial markets.

NZD/AUD/CAD
The increase in risk aversion had the biggest negative effect on the commodity currencies. The Canadian and New Zealand dollars felt the effects the most with both currencies dropping 300 and 185 pips respectively to the Japanese yen. The Australian dollar, which had under performed its two peers, bounced back significantly today. There was no news released, so most of today's move could be explained by simply a technical correction to the recent bearish trend for the aussie. Figure 2 shows the USD/CAD currency pair bouncing off a technical support level that used to be a downward sloping resistance trend line for the pair. A break aback above parity and the former high at $1.02 would confirm a fresh series of higher highs and lows that would define the new bullish trend for the currency pair.

Figure 2 - Technical Support Bounce on USD/CAD

JPY
Stocks were mixed in Asian and Europe but a big jump in volatility during the U.S. trading session caused the Japanese yen to gain against all the major currencies today. The calendar is completely empty; so keep an eye on the CBOE Volatility Index ($VIX) for clues about the carry trade for the rest of the holiday week. Figure 3 shows the $VIX close to a technical resistance level. If this level breaks, and the volatility index climbs higher than its previous high at 25, forex investors will continue to push the higher yielding currencies lower while buying back the Japanese yen.

Figure 3 - Symmetrical Triangle on the $VIX

EUR/GBP/CHF
The euro and Swiss franc gave back its gains from late last week, as the turmoil in Pakistan appears to be settling down. Early in the trading session the British pound showed some signs of life. The oversold currency started to bounce of its lows against its European peers. Although the pound sterling finished the day higher, it was well off its highs for the day. The Swiss franc out performed the euro on the basis of risk aversion. The lower yielding currency benefits when stock prices fall, but not to the same extent as the Japanese yen. The economic calendar was empty in the region this morning, but this will change after the holiday.

Weekly Articles
Be sure to check this week's "Economic Calendar" to monitor what indicators are due overnight and tomorrow morning. For additional insights for your FX investing, read this week's "Technical Commentary" article. The "Weekly FX Commentary" article wrap-ups last week's action, along with ideas on how you can position yourself for the upcoming week. Finally, "Institutional Tracking" and "Intermarket Analysis" are additional resources for Investools FX students to analyze a few of the key major currency pairs. These are all updated every Friday.

CURRENCY TRADING SUMMARY

2009-05-25T15:02:00.001-07:00

· &nbs...U.S. Dollar Trading (USD) felt more pressure as traders tested the dollars downside once again. A small rise in US stocks and better than expected US trade data prompted more risk taking. March Trade Balance at -27.5Bn vs. -29Bn forecast. Crude Oil was up $1.30 ending the New York session at $59.57 per barrel. In US share markets, the Nasdaq was down 15 points or -0.88% and the Dow Jones was up 50 points or 0.60%. Looking ahead, April Retail Sales forecast at 0.0% vs. -1.2% previously.

· &nbs...The Euro (EUR) jumped another notch higher, testing the 1.3700 level before easing slightly. German CPI was as expected 0.7% y/y in April. Further gains in the Euro can not be ruled out as the improved confidence in world markets extends the equity rebound. Overall the EUR/USD traded with a low of 1.3563 and a high of 1.3709 before closing at 1.3650. Looking ahead, March Industrial Production forecast at -1% vs. -2.3% previously.

· &nbs...The Japanese Yen (JPY) was unable to turn positive sentiment into USD/JPY gains as the pair continued to slip towards the 95 Yen level. Other movements on the crosses were muted by the majors. Critical Support at 95 could be tested in the coming week. Overall the USDJPY traded with a low of 95.98 and a high of 97.86 before closing the day around 96.20 in the New York session. March Current Account at -48.8 vs. -58.4%.

· &nbs...The Sterling (GBP) surged off the 1.5100 level in Early Europe as UK economic data surged the pair to 1.5300. Manufacturing Production dropped -0.1% vs. -0.8% forecast. UK Trade Balance at -6.6Bn vs. -7.2Bn forecast. Finally Industrial Production at -0.6% vs. -0.7% forecast. All these combined to reignite the Pound Rally. Overall the GBP/USD traded with a low of 1.5072 and a high of 1.5356 before closing the day at 1.5290 in the New York session. Looking ahead, BOE Quarterly Inflation Report.

· &nbs...The Australian Dollar (AUD) rallied back towards 0.7700 as commodities surged led by Oil. The Federal Budget released yesterday had little impact on the Aussie as the most had being leaked. A record deficit though does not help the longer term outlook. Overall the AUD/USD traded with a low of 0.7560 and a high of 0.7700 before closing the US session at 0.7660.

· &nbs...Gold (XAU) gained on the back of the fresh USD weakness. Continued strength in Oil is underpinning the gains. Overall trading with a low of USD$911 and high of USD$929 before ending the New York session at USD$924 an ounce.

TECHNICAL COMMENTARY

Currency	Sup 2	Sup 1	Spot	Res 1	Res 2
EUR/USD	1.3247	1.3343	1.3685	1.3739	1.3799
USD/JPY	95.63	96.12	96.20	98.82	99.75
GBP/USD	1.4836	1.4944	1.5300	1.5373	1.5477
AUD/USD	0.7337	0.7459	0.7685	0.7738	0.8097
XAU/USD	878.00	895.00	925.00	933.00	945.00

· &nbs... Euro – 1.3685

Initial support at 1.3343 (May 8 low) followed by 1.3247 (May 6 low). Initial resistance is now located at 1.3739 (March 19 high) followed by 1.3799 (Jan 8 high)

· &nbs... Yen – 96.20

Initial support is located at 96.12 (May 12 low) followed by 95.63 (Apr 29 low). Initial resistance is now at 98.82 (May 11 high) followed by 99.75 (Apr 17 high).

· &nbs... Pound – 1.5300

Initial support at 1.4944 (May 7 low) followed by 1.4836 (May 4 low). Initial resistance is now at 1.5373 (Jan 8 high) followed by 1.5477 (38.2% retrace 1.3503-1.8669).

· &nbs... Australian Dollar – 0.7685

Initial support at 0.7459 (May 7 low) followed by the 0.7337 (May 6 low). Initial resistance is now at 0.7738 (Oct 6 high) followed by 0.8097 (Sept 30 high).

· &nbs... Gold – 925

Initial support at 895 (May 6 low) followed by 878 (Apr 21 low). Initial resistance is now at 933 (Apr 1 high) followed by 945 (Mar 26 high).

Forex Market Update

2009-05-25T14:58:00.001-07:00

USD takes a breather after its recent slide; Markets likely quiet in holiday-thinned trade

Geo-politics causes a stir in Asia as North Korea conducts underground nuclear test

MAJOR HEADLINES – PREVIOUS SESSION

AU ASIC lifts current ban on covered short-selling of financial securities
JP Mar. All Industry Activity Index out at -2.4% m/m vs. -2.3% expected and revised -2.3% prior
SI Apr. CPI out at -1.1% m/m, -0.7% y/y vs. -0.4%, +0.6% expected and -0.4%, +1.6% resp.

THEMES TO WATCH – UPCOMING SESSION

GE IFO Business Climate/Current Assessment/Expectations (0800)
EU ECB’s Weber speaks (1000)
EU ECB’s Gonzalez-Paramo speaks (1800)
UK Spring Bank Holiday
US Memorial Day Holiday

Market Comment:

In its annual health check on Britain, the IMF concluded the “The aggressive actions by the authorities have been successful in containing the crisis and averting a systemic breakdown.” In addition, the IMF opined that it expects the authorities to deliver domestic and external stability and set the stage for a sustainable recovery. This, together with comments from the OECD at the weekend that a downgrade for the UK’s AAA rating was not justified and inexplicable, must be welcome news to the ears of British PM Gordon Brown who finds his government getting deeper and deeper embroiled in expenses scandals. Pressure looks set to intensify for an early general election and there is no doubt that the current Labour government would be decimated under the current electorate mood. Indeed, the Sunday Times reckons that at least half of the House of Commons’ 646 MPs will be swept away at the next general election.

Fed’s Kohn maintained the recent Fed tone on the economy in his speech on Friday. He reiterated that the US economy is now beginning to show signs that it might be stabilizing, and that the upturn, when it comes, was likely to be gradual as corporate and household America “repair” their balance sheets. As a result, he expects the Federal Funds rate to be close to zero for some time. Elsewhere, Fed’s Fisher said he was “grilled” (his words) by senior Chinese government officials on his recent trip on whether or not the US was going to monetize that actions of the legislature. On this topic, the FT carries a report on how China is stuck in a “dollar trap”, despite its musings and efforts to diversify its reserves from the dollar. The gist of the report highlights that the sheer size of China’s USD holdings will prevent it from shifting weightings in a big way.

In this morning’s events, Australia’s securities regulator ASIC lifted its eight-month ban on covered short-selling of financial securities, taking advantage of the apparent stability and recovery in the global financial system. However, the regulator warned that it would have no hesitation in re-introducing such a ban if market conditions warranted. Its monitoring of the market and market movements would likely encompass a tight review of short-selling activities by participants, in particular hedge fund and similar institutions. Reaction on the ASX was relatively muted though financials saw a knee-jerk 2%+ sell-off which was partly countered by a buoyant resource sector. Impact on the AUD was limited to a 30 tic slide on the day.

On the geo-political front, South Korea news agency Yonhap reported that North Korea had conducted a nuclear test this morning with the South Korean weather agency detecting a 4.7 magnitude tremor around the time. S Korean stocks plummeted into the red, with losses of over 4% while the KRW slid 1.6% against the dollar. The impact also filtered though across emerging Asia and the Nikkei opened with a softer tone after the break.

As the USD retreats even amid broader risk aversion themes, commodities continue to benefit as the next-best-thing safe haven in particular oil. OPEC members will be gathering in Vienna on Thursday amid a better mood and sentiment among them. Analysts are suggesting price levels are sufficiently high enough for OPEC not to consider further production cuts despite bloated inventories and still weak demand. Venezuela’s oil minister had previously commented that the cartel was aiming for oil prices around $60 p/barrel while the Saudi minister sees a pickup in demand, especially from Asia, dragging prices closer to $75 p/barrel.

Knowing You & Knowing Them

2009-05-06T11:42:00.000-07:00

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We guarantee your investment will be safe with us, we invest wisely, our policy is,((W.W.W.)) Why to invest, When to invest and where to invest, and most important, HOW to invest.Whether you are saving for the future or for a more immediate goal. Forex Business Services team can help you get there. Our comprehensive investment plan allows for investors to build financial stability and reach their goals.

Triangular trade, or Triangle trade,

2009-04-02T23:18:00.000-07:00

Triangular trade, or Triangle trade, is a historical term indicating trade among three ports or regions. The trade evolved where a region had an export commodity that was required in the region from which its major imports came. Triangular trade thus provided a mechanism for rectifying trade imbalances.

The Transatlantic Triangular Trade operated during the 17th, 18th and early 19th centuries, carrying slaves, cash crops, and manufactured goods between West Africa, the Caribbean or American colonies and the European colonial powers, with the northern colonies of British North America, especially New England, sometimes taking over the role of Europe.^[1]

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2009-04-02T23:15:00.000-07:00

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Economic Indicators

2009-03-31T11:44:00.000-07:00

Economic indicators can be anything, from the bits and pieces of financial and economic news, to the data published by different agencies on the statistics of government or private sector.

This data is regularly made public to help the common man keep track of the latest developments in the nation’s financial sector. Most benefited from these economic indicators are the market observers who are constantly keeping an eye on the overall economy and its effect on the market. This is the main reason why such indicators are consistently tracked by nearly everyone related to the financial markets in some way or another.

Also, this is the rationale behind the economic indicators containing great potential for creating levels and moving currency prices along with the whole markets, as so many people are expected to respond to the same data together.

What is Forex?

2009-03-31T11:41:00.000-07:00

The largest financial market in the world, Foreign Exchange market, Forex or FX market, all the terms are used to describe the business of trading of the world's various currencies, with more than $2 trillion changing hands every day. Being an international foreign exchange market, Forex is a market where money is sold and bought freely. FOREX was launched in the 1970s, to become the biggest liquid financial market today, dealing in more than hundred times the daily trading on the New York Stock Exchange.

FOREX is a perfect market to invest in, as it is free from any external control and free competition. Mostly, all Forex trading are tentative and unlike the stock market trading, the Forex market is not conducted by a central exchange, but on the “interbank” market, which is thought of as an OTC (over the counter) market. The trading takes place between the two dealers, either over the telephone or through Internet, all over the world. The major trading centers are the ones at Sydney, London, Frankfurt, Tokyo and New York, making Forex a 24-hour market.

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2009-03-31T11:23:00.000-07:00

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Currencies

2009-03-31T11:19:00.000-07:00

		USD	EUR	CAD	GBP	AUD	MXN	JPY
1 USD	=	1.000	0.753	1.262	0.697	1.437	14.146	99.110
1 EUR	=	1.327	1.000	1.675	0.925	1.907	18.777	131.550
1 CAD	=	0.793	0.597	1.000	0.553	1.139	11.212	78.553
1 GBP	=	1.434	1.081	1.810	1.000	2.061	20.290	142.154
1 AUD	=	0.696	0.524	0.878	0.485	1.000	9.845	68.975
1 MXN	=	0.071	0.053	0.089	0.049	0.102	1.000	7.006
1 JPY	=	0.010	0.008	0.013	0.007	0.014	0.143	1.000

More Currencies

Retracements

2009-03-31T11:02:00.000-07:00

Measure retracements in percentage terms. Market corrections up or down often retrace a significant portion of the previous trend. One can measure the corrections in an existing trend in simple percentages. A fifty percent retracement of a prior trend is most common. A minimum retracement is usually one-third of the prior trend. The maximum retracement is usually two-thirds. Fibonacci retracements of 38% and 62% are also worth watching. Therefore popular buy points in an uptrend are usually between 33-38% retracement of the original trend.

As can be seen from the chart below, when joining the trough at 1.2750 to the peak at 1.2890 in the 1-hour EUR/USD chart we can see the Fibonacci levels drawn out. The first retracement ended at the 38% line and the major retracement at the 62% line.

Oscillators

2009-03-31T11:01:00.001-07:00

Oscillators help identify overbought and oversold markets. While moving averages offer confirmation of a trending market, oscillators can often warn us in advance that a market has rallied or fallen too far and will soon turn or retrace. Two of the most popular oscillators are the Relative Strength Index or RSI and the Stochastics. Both these oscillators work on a scale of 0 to 100. With the RSI, readings over 70 are overbought while readings below 30 are oversold. The overbought and oversold values for Stochastics are 80 and 20. Oscillator divergences often warn of market turns and as opposed to moving averages they work best in range bound markets. Weekly signals can be used as filters on daily signals. Daily signals can be used as filters for intra-day charts.

As can be seen in the EUR/USD 1-hour chart below, the Stochastics break through the 80-20 barriers and cross over themselves on corrections of the price. This occurs several times.

Moving Averages

2009-03-31T11:01:00.000-07:00

Moving averages often provide objective buy and sell signals, hence they should be watched. They show you if an existing trend is still in motion and help confirm a trend change. Do not rely on moving averages to tell you in advance if there is a trend change imminent; use it as a back-up to your chart analysis for trend identification. A combination chart of two moving averages is the most popular way of finding trading signals. Signals are given when the shorter average line crosses the longer. Price crossings above and below a 40-day and 200-day moving average also provide good trading signals. Since moving average chart lines are trend-following indicators, they work best in a trending market.

As can be seen in the EUR/USD 1-hour chart below the 5-period and 25-period moving averages project and confirm the trend in progress. The 5-period moving average crosses over the slower 25-period moving average at 1.2715 confirming the up-trend with an exit point at 1.2770. The same rate 1.2770 is another indication of a resume in the up-trend with an exit at 1.2850.

Know the Warning Signs

2009-03-31T11:00:00.000-07:00

he Moving Average Convergence Divergence (MACD) indicator combines a moving average crossover system with the overbought/oversold elements of an oscillator. A buy signal occurs when the faster line crosses above the slower and both lines are below zero. A sell signal takes place when the faster line crosses below the slower from above the zero line. Longer-period signals take precedence over shorter-period signals. The MACD histogram plots the difference between the two lines and gives even earlier warnings of trend changes. It's called a histogram because vertical bars are used to show the difference between the two lines on the chart.

As can be seen in the EUR/USD 1-hour chart below, the MACD indicators cross over one another beneath the zero line to show a buy signal and vice versa for the sell signal. This occurs most prominently at 1.2760 to buy, 1.2870 to sell.

Chart the Trends and Range Bound Markets

2009-03-31T10:55:00.000-07:00

Use long term charts to decide trends or range bound markets. Begin a chart analysis with daily, weekly and even monthly charts spanning several years if possible. A larger scale chart essentially shows the life of the market and provides clearer visibility and a better long-term perspective on a market. Once the long-term has been established, consult daily and intra-day charts, these charts can include anything from say 10 minute to daily charts. A short-term market view alone can often be deceptive. Even if you only trade the very short term, you will do better if you're trading in the same direction as the intermediate and longer-term trends. If there is no trend then a different strategy is necessary, possibly playing the range until the market begins to trend once more.

As can be seen in the 1-hour EUR/USD candle chart below there has been an uptrend with three peaks and three troughs. Long entry positions would at 1.2700, 1.2760 and 1.2800.

Bearish Scenario:

2009-03-31T10:53:00.000-07:00

If we see substantially deeper available liquidity on the Offer side of the market, this tells us that major price providers in the market are looking to sell the Euro against the US Dollar. Considering that close to 60% of all FX market volume is cleared through just six top banks, we see it prudent to be on the same side of the trade as major institutions and will favor a bearish bias on EURUSD ahead of the data release.

Bullish Scenario:

2009-03-31T10:52:00.000-07:00

If we see substantially deeper available liquidity on the Bid side of the market, this tells us that major price providers in the market are looking to buy the Euro against the US Dollar. Considering that close to 60% of all FX market volume is cleared through just six top banks, we see it prudent to be on the same side of the trade as major institutions and will favor a bullish bias on EURUSD ahead of the data release.

January 2009 U.S. ISM Manufacturing

2009-03-31T10:51:00.000-07:00

Manufacturing activity in the U.S. dropped at a slower pace in January after falling to its weakest level in 28-years during the previous month, and economic activity in the region is likely to remain subdued in the months ahead as businesses continue to face fading demands from home and abroad. The ISM index increased to 35.6 from a revised reading of 32.9 in December as new orders increased to 33.2 from a record-low of 23.1 in the previous month. A deeper look at the report showed that new export orders increased to 37.5 from 35.5, while inventories slipped to 37.5 from 39.6, which is the lowest since July 2001, and conditions are likely to get worse throughout the first half of the year as the world’s largest economy faces its longest recession in over a quarter century. As turmoil in the banking sector intensifies while the outlook for growth and inflation falter, the Fed is likely to step up its efforts as policy makers attempt to steer the economy out of a deepening

February 2009 U.S. ISM Manufacturing

2009-03-31T10:48:00.000-07:00

The ISM report showed that manufacturing in the U.S. contracted for 13 consecutive months in February, but fell at a slower pace from the previous month as the index increased to 35.8 from 35.6 in January. The breakdown of the report showed new orders ticked lower to 33.1 from 33.2, while the employment component slipped to 26.1 from 29.9, which is the lowest since recordkeeping began in1948, and the data continues to foreshadow a deepening recession in the world’s largest economy as the labor market deteriorates at a record pace. As households continue to face falling home prices paired with fading demands for employment, the outlook for private-spending remains weak, and conditions are likely to get worse as firms continue to cut back on production and investment in response to the downturn in global trade.

Learn Forex

2009-03-31T10:36:00.000-07:00

FOREX (the Foreign Exchange market) is an international market where participants speculate on the value of different currencies, buying and selling dollars, pounds, euros, and other currencies.

There are only a few major currencies to follow, compared to hundreds of stocks in the equities market. In order to get started understanding Forex, sign up for a free practice account today and learn as you trade!

Trading risk free with a practice account is the best way to get familiar with this ever-growing market. And once you are signed up, CMS Forex will provide you with thorough educational resources to guide you along the way.

So don't wait, take this opportunity to get started trading Forex!

How to Trade Forex

2009-03-31T10:35:00.000-07:00

Trading foreign exchange is exciting and potentially very profitable, but there are also significant risk factors. It is crucially important that you fully understand the implications of margin trading and the particular pitfalls and opportunities that foreign exchange trading offers. On these pages, we offer you a brief introduction to the Forex markets as well as their participants and some strategies that you can apply. However, if you are ever in doubt about any aspect of a trade, you can always discuss the matter in-depth with one of our dealers. They are available 24 hours a day on the Saxo Bank online trading system, SaxoTrader.
The benchmark of its service is efficient execution, concise analysis and expertise – all achieved whilst maintaining an attractive and competitive cost structure. Today, Saxo Bank offers one of Europe's premier all-round services for trading in derivative products and foreign exchange. We count amongst our employees numerous dealers and analysts, each of whom has many years experience and a wide and varied knowledge of the markets – gained both in our home countries and in international financial centres. When trading foreign exchange, futures and other derivative products, we offer 24-hour service, extensive daily analysis, individual access to our Research & Analysis department for specific queries, and immediate execution of trades through our international network of banks and brokers. All at a price considerably lower than that which most companies and private investors normally have access to.
The combination of our strong emphasis on customer service, our strategy and trading recommendations, our strategic and individual hedging programmes, along with the availability to our clients of the latest news and information builds a strong case for trading an individual account through Saxo Bank.
Terms of trading are agreed individually depending on the volume of your transactions, but are generally much lower in cost when compared to banks and brokers. Your margin deposit can be cash or government securities, bank guarantees etc. Large corporate or institutional clients may be offered trading facilities on the strength of their balance sheet. The minimum deposit accepted for an individual trading account depends on the account type. Trade confirmations and real-time account overview are built into SaxoTrader, while further account information can be produced in accordance with your specific requirements.

Trading the US Durable Goods Orders Report Using the EUR/USD

2009-03-31T10:23:00.000-07:00

The U.S. dollar is likely to face increased selling pressures over the next 24 hours of trading as economists forecast demands for durable goods to contract another 2.5% in February as private-sector spending falters. The preliminary GDP reading for the fourth quarter showed that the annual rate of growth contracted the most since 1982, while personal consumption dropped 4.3% from the third quarter to mark the largest decline since 1980

Since its inception, CMS Forex’s VT Trader™ has been a comprehensive and easy to use Forex trading toolkit and a pioneer in the industry. Easy access

2009-03-31T10:20:00.000-07:00

Since its inception, CMS Forex’s VT Trader™ has been a
comprehensive and easy to use Forex trading toolkit and
a pioneer in the industry.

Easy access to powerful tools

Highly developed charting technology

Advanced customization

Reuters news and market analysis

Sophistication and convenience set VT Trader™ apart from other Forex trading software.

Overview

2009-03-31T10:19:00.001-07:00

Foreign exchange, Forex or just FX are all terms used to describe the trading of the world's many currencies. The Forex market is the largest market in the world, with trades amounting to more than USD 3 trillion every day. Most Forex trading is speculative, with only a low percentage of market activity representing governments' and companies' fundamental currency conversion needs.

Unlike trading on the stock market, the Forex market is not conducted by a central exchange, but on the “interbank” market, which is thought of as an OTC (over the counter) market. Trading takes place directly between the two counterparts necessary to make a trade, whether over the telephone or on electronic networks all over the world. The main centres for trading are Sydney, Tokyo, London, Frankfurt and New York. This worldwide distribution of trading centres means that the Forex market is a 24-hour market.

Trading Forex

2009-03-31T10:19:00.000-07:00

A currency trade is the simultaneous buying of one currency and selling of another one. The currency combination used in the trade is called a cross (for example, the euro/US dollar, or the GB pound/Japanese yen.). The most commonly traded currencies are the so-called “majors” – EURUSD, USDJPY, USDCHF and GBPUSD.

The most important Forex market is the spot market as it has the largest volume. The market is called the spot market because trades are settled immediately, or “on the spot”. In practice this means two banking days.

Foreign Exchange

2009-03-31T10:17:00.000-07:00

This short introduction explains the basics of trading Forex online, a brief explanation of the markets and the major benefits of trading Forex online. There are also two scenarios describing the implications of trading in a bear as well as a bull market to better acquaint you with some of the risks and opportunities of the largest and most liquid market in the world.

John J. Hardy

2009-03-31T10:16:00.000-07:00

Asset Management, Saxo Bank

John Hardy publishes daily comments on the Forex market. Mr Hardy's analysis attempts to overlay short term technical developments and fundamental event risks with longer term themes and trends in the G-10 currencies. Mr Hardy considers inter-market correlations as paramount in understanding moves in the Forex space, so the analysis draws on a number of models based on other markets and gauges their correlation with Forex markets in an attempt to detect inefficiencies that may provide trading opportunities.

David Karsbøl

2009-03-31T10:15:00.000-07:00

Manager/Market Strategist, Saxo Bank

David Karsbøl holds a Master of Science degree (Economics) from the University of Copenhagen and has previously been employed as an insurance analyst. Mr Karsbøl works with fundamental analysis and research and contributes to Saxo Bank's strategy products. He also develops and maintains macroeconomic models and a number of trading models, which are designed to profit from co-variations between the Forex and fixed income markets. Mr Karsbøl is regularly appears on major financial news networks and comments several days a week on the financial markets via Saxo Bank's live Market Call webcast. He is a native Danish speaker and is fluent in English.

Expert View

2009-03-31T10:13:00.000-07:00

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2009-03-31T10:09:00.000-07:00

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What is IBFX-Waves?

2009-03-31T08:05:00.000-07:00

IBFX-Waves is a custom indicator that is based upon the Elliott Wave Theory—a method of technical analysis that has been popular in various financial markets since the mid-1970s. Traders in the US stock market have given particular attention to the theory’s belief that market trends and crowd behavior (particularly the crowd’s tendency to push for reversal of price direction after over-ambitious market moves) can be most easily recognized in a basic pattern that accounts for five distinct “waves.” Of course the complete Elliott Wave Cycle extends far beyond just five basic pattern movements, but essentially even the more complex pattern cycles can be accounted for as simple extensions of the five basic waves.