Saturday, August 15, 2009
Euro Rises for 3rd Day on Optimism Europe’s Contraction Slowed
The euro also advanced against 13 of the 16 major currencies before a U.S. report that may show retail sales gained for a third month, prompting investors to seek higher- yielding assets. South Korea’s won led Asian currencies higher after the Federal Reserve acknowledged that the worst U.S. recession since the 1930s may be ending, helping shore up demand for riskier assets. “I expect growth in the euro-zone economy will be very high” later this year and that should benefit the euro, said Adam Carr, a senior economist at ICAP Australia Ltd. in Sydney. “I will be surprised if we didn’t see something positive in the second half of this year.” The euro strengthened to $1.4224 as of 11:06 a.m. in Tokyo from $1.4188 yesterday in New York. The 16-nation currency rose to 136.47 yen from 136.32 yen. The yen was at 95.96 per dollar from 96.06. The won rose 0.8 percent to 1,236.60 per dollar.
Morning Forex Overview
The euro rose against the yen and the dollar in Asia Thursday as firm Asian share markets spurred demand for the riskier euro.
Overnight comments by the Federal Reserve also led to a more optimistic economic outlook among traders, nudging them to take more risks and buy the single currency, dealers said. The euro's near-term direction is slightly upward, they added.
Regional share markets were broadly higher. As of 0530 GMT Japan's benchmark Nikkei 225 Stock Average index was up 1.0%, while stock markets in South Korea, India and Australia also gained.
Some Japanese banks sold the dollar for the yen due to redemptions of dollar-denominated bonds, traders said.
The Euro tested USD1.4100 before bouncing hard on USD weakness in the US session, shrugging off the FOMC report to finish above USD1.4200. June Industrial Production fell -0.6% vs. 0.3% forecast. EURJPY had a wild day trading in a 3 yen range on the change in risk appetite. EURGBP remained supported on GBP weakness.
British pound propped up by a weaker US dollar despite bearish sentiment in their country. Bank of England said inflation will stay below its 2 percent target as its economy undergoes a "slow and protracted" recovery. UK Central bank Governor Mervyn King said it is "more likely than not" that inflation will slow below 1 percent this year and unemployment reached a 14-year high. Thus, UK interest rates are expected to remain on hold for a while.
The Australian dollar reversed course Thursday, rallying as risk appetite regained lost ground while long-dated bond futures were sold. Spurring the risk-buying mood in Asia was a relatively optimistic outlook from the U.S. Federal Reserve, which didn't extend it's bond buying program and said the economy's contraction is slowing.
Market expectation
The euro is marginally higher against the dollar, yen and UK pound as short-term Asian investors buy on higher risk tolerance.
EURUSD reported offers placed between USD1.4265/70 able to contain the early GDP react driven rally, with underlying tone remaining firm. Rate currently trades around USD1.4257 after touching fresh intraday highs at USD1.4268 (50% USD1.4448/1.4086). Above USD1.4270 may open a move on toward USD1.4280/85.
For Pound offers seen placed above USD1.6585 through to USD1.6600, a break to open a move on toward USD1.6615/20 ahead of stronger level at USD1.6650. Support now seen placed at USD1.6550, a break below USD1.6540 to open a deeper move back toward USD1.6510/00.
Attention now turns to U.S. retail sales data at 1230 GMT and second-quarter earnings from Wal-Mart Stores Inc. later in the day to gauge whether consumption is recovering in the U.S.
The euro could rise toward JPY138.00 and USD1.4300, if those figures come in better than expected, adding to the positive outlook for the U.S. economy, dealers said.
European stock markets are expected to open higher Thursday, as investors react with optimism to the latest comments from the Federal Reserve about the strength of the U.S. economy, the world's largest.
Overnight comments by the Federal Reserve also led to a more optimistic economic outlook among traders, nudging them to take more risks and buy the single currency, dealers said. The euro's near-term direction is slightly upward, they added.
Regional share markets were broadly higher. As of 0530 GMT Japan's benchmark Nikkei 225 Stock Average index was up 1.0%, while stock markets in South Korea, India and Australia also gained.
Some Japanese banks sold the dollar for the yen due to redemptions of dollar-denominated bonds, traders said.
The Euro tested USD1.4100 before bouncing hard on USD weakness in the US session, shrugging off the FOMC report to finish above USD1.4200. June Industrial Production fell -0.6% vs. 0.3% forecast. EURJPY had a wild day trading in a 3 yen range on the change in risk appetite. EURGBP remained supported on GBP weakness.
British pound propped up by a weaker US dollar despite bearish sentiment in their country. Bank of England said inflation will stay below its 2 percent target as its economy undergoes a "slow and protracted" recovery. UK Central bank Governor Mervyn King said it is "more likely than not" that inflation will slow below 1 percent this year and unemployment reached a 14-year high. Thus, UK interest rates are expected to remain on hold for a while.
The Australian dollar reversed course Thursday, rallying as risk appetite regained lost ground while long-dated bond futures were sold. Spurring the risk-buying mood in Asia was a relatively optimistic outlook from the U.S. Federal Reserve, which didn't extend it's bond buying program and said the economy's contraction is slowing.
Market expectation
The euro is marginally higher against the dollar, yen and UK pound as short-term Asian investors buy on higher risk tolerance.
EURUSD reported offers placed between USD1.4265/70 able to contain the early GDP react driven rally, with underlying tone remaining firm. Rate currently trades around USD1.4257 after touching fresh intraday highs at USD1.4268 (50% USD1.4448/1.4086). Above USD1.4270 may open a move on toward USD1.4280/85.
For Pound offers seen placed above USD1.6585 through to USD1.6600, a break to open a move on toward USD1.6615/20 ahead of stronger level at USD1.6650. Support now seen placed at USD1.6550, a break below USD1.6540 to open a deeper move back toward USD1.6510/00.
Attention now turns to U.S. retail sales data at 1230 GMT and second-quarter earnings from Wal-Mart Stores Inc. later in the day to gauge whether consumption is recovering in the U.S.
The euro could rise toward JPY138.00 and USD1.4300, if those figures come in better than expected, adding to the positive outlook for the U.S. economy, dealers said.
European stock markets are expected to open higher Thursday, as investors react with optimism to the latest comments from the Federal Reserve about the strength of the U.S. economy, the world's largest.
Germany, France exit recession early
German gross domestic product rose by 0.3 percent in the second quarter, bringing an end to the country's deepest recession since World War Two and boosting hopes of recovery in the broader euro zone. French GDP also grew by 0.3 percent in the second quarter. The consensus in a Reuters poll of economists had predicted a 0.3 percent quarterly contraction in both countries. "The data is very surprising. After four negative quarters France is finally coming out of the red," French Economy Minister Christine Lagarde told RTL radio. Germany suffered a calamitous 3.5 percent contraction in the first quarter of this year to cap four quarters of decline while the French economy shrank by 1.3 percent.
Euro hits 1-week high vs dollar after EZ Q2 GDP
Euro zone gross domestic product contracted only 0.1 percent in April-June against the first three months of the of 2009, when the quarterly fall was 2.5 percent, estimates from the European Union's statistics office Eurostat showed [ID:nLD440556]. The euro EUR rose as high as $1.4281 according to electronic trading platform EBS, its strongest since last Friday. The pair traded around $1.4255 before the announcement.
U.S. Unemployment Claims Increased to 558,000
Featured Advertiser (ForexDistrict) - Seasonally adjusted initial claims were 558,000 in the week ending August 8, recording an increase of 4,000 from the previous week's revised figure of 554,000, a report by the U.S. Department of Labor showed today. The four-week moving average, a better gauge of initial claims, estimated an increase of 8,500 to 565,000. Initial claims were lower than expectations for the second week of August as analysts had expected the number around the 548,000 range. A key component of the report edged lower, albeit remaining at record highs. During the week ending August 1 a decrease of 141,000 was reported with the figure falling near the 6.0 million mark at 6,202,000. The largest increases in initial claims for the week ending August 1 were in Alabama, Washington, Nebraska, Kentucky, and Delaware, while the largest decreases were in California, Michigan, Tennessee, Florida, and Georgia. By Manuel F. Ramirez. Edited by Juan P. Bejarano Related Stories:
Retail Sales in U.S. Unexpectedly Fell as Job Losses Mounted
Sales at U.S. retailers unexpectedly fell in July, the first decline in three months, as concern over jobs and stagnant incomes caused consumers to cut back on other items after taking advantage of the cash-for-clunkers program. The 0.1 percent decrease followed a revised 0.8 percent gain in June that was larger than previously estimated, Commerce Department figures showed today in Washington. Purchases excluding automobiles fell 0.6 percent, also more than anticipated.
New Zealand Q2 retail sales gain, backing low rates
Sales volumes, which strip out price movements, rose 0.4 percent in the April to June period over the previous quarter, seasonally adjusted, with core, ex-auto, sales up 0.2 percent, official data showed on Friday. A Reuters poll forecast no change in sales volumes. The data was seen pointing to the economy starting to emerge from recession that started early last year, but not requiring any change to the central bank's low rate policy. 'It's the sort of thing that leaves the Reserve Bank (of NZ) where it is, reducing the odds of a rate cut,' said Bank of NZ senior economist Craig Ebert.
Morning Forex Overview
The euro and dollar fell against the yen in Asia Friday as weak Chinese stocks and lower U.S. long-term interest rates prompted players to sell those units for the Japanese currency.
Japanese exporters joined in the selling on a regular settlement day, dealers said, while the dollar came under further pressure ahead of the redemption of U.S. Treasurys on August 17.
With the outlook for Chinese share prices remaining grim, the euro and dollar are expected to continue heading southward against the yen, traders said.
Short-term foreign exchange market players have recently grown sensitive to movements in Chinese share markets, amid concerns that weaker-than-expected Chinese growth may drag on a global recovery. A slumping Shanghai Composite index, down 2.4% in early afternoon trade, again triggered a selloff in risk sensitive currencies such as the euro.
Meanwhile, the dollar stood at JPY95.22 compared to JPY95.36 late Thursday in New York. The greenback had fallen against the yen overnight, after U.S. retail sales data marked a 0.1% drop in July, disappointing expectations for a 0.8% rise. Sentiment remained negative in Asia, dealers said.
Euro rose to a one-week high at USD1.4328 against the greenback on Thursday as the euro zone's two biggest economies unexpectedly returned to growth in the second quarter of the year. In Germany, Europe's largest economy, gross domestic product rose surprisingly by 0.3% in the second quarter.
The British pound rebounded even though the UK unemployment rate jumped to 7.8 percent during the second quarter, the highest rate in 14 years, up from 7.1 percent during the first quarter. Yesterday, Bank of England in its inflation report indicated that rates will not be raised for some time.
A bullish economic outlook from the central bank sent the Australian dollar to 11 month highs in Asia Friday before renewed jitters on the Shanghai stock exchange sparked a bout of profit taking.
Market expectation
The euro is under some pressure on Friday, as the slump in the Chinese stock markets dents risk appetite more broadly in Asia.
EURUSD bids seen placed between USD1.4255/50, a break below to open a deeper move toward USD1.4245/40 with further interest tucked in close behind at USD1.4235/30. Below here and rate can ease toward USD1.4220/10. Asian account offers noted at USD1.4295, with Swiss accounts sell interest seen at USD1.4315 ahead of stops placed on a break of USD1.4320.
EURGBP closed in NY at stg0.8618, the rate nudging up to stg0.8622 in early Asian trade (NY high stg0.8623) before easing back to stg0.8604. Rate currently trades around stg0.8618 into early Europe. Offers seen placed from stg0.8622 through to stg0.8630, a break to open a move on toward stg0.8640/45 ahead of stg0.8650/55. Support stg0.8605/00, a break to allow for a deeper move toward stg0.8590/85 ahead of stg0.8575/70.
Currency market reactions to data and other events could continue to be rather fickle for some time yet, given the still-rampant uncertainties relating to growth and also the low-liquidity summer environment, Said analysts.
Analysts said there's scope for the local unit to resume its climb higher if U.S. consumer confidence numbers due later surprises on the upside.
Japanese exporters joined in the selling on a regular settlement day, dealers said, while the dollar came under further pressure ahead of the redemption of U.S. Treasurys on August 17.
With the outlook for Chinese share prices remaining grim, the euro and dollar are expected to continue heading southward against the yen, traders said.
Short-term foreign exchange market players have recently grown sensitive to movements in Chinese share markets, amid concerns that weaker-than-expected Chinese growth may drag on a global recovery. A slumping Shanghai Composite index, down 2.4% in early afternoon trade, again triggered a selloff in risk sensitive currencies such as the euro.
Meanwhile, the dollar stood at JPY95.22 compared to JPY95.36 late Thursday in New York. The greenback had fallen against the yen overnight, after U.S. retail sales data marked a 0.1% drop in July, disappointing expectations for a 0.8% rise. Sentiment remained negative in Asia, dealers said.
Euro rose to a one-week high at USD1.4328 against the greenback on Thursday as the euro zone's two biggest economies unexpectedly returned to growth in the second quarter of the year. In Germany, Europe's largest economy, gross domestic product rose surprisingly by 0.3% in the second quarter.
The British pound rebounded even though the UK unemployment rate jumped to 7.8 percent during the second quarter, the highest rate in 14 years, up from 7.1 percent during the first quarter. Yesterday, Bank of England in its inflation report indicated that rates will not be raised for some time.
A bullish economic outlook from the central bank sent the Australian dollar to 11 month highs in Asia Friday before renewed jitters on the Shanghai stock exchange sparked a bout of profit taking.
Market expectation
The euro is under some pressure on Friday, as the slump in the Chinese stock markets dents risk appetite more broadly in Asia.
EURUSD bids seen placed between USD1.4255/50, a break below to open a deeper move toward USD1.4245/40 with further interest tucked in close behind at USD1.4235/30. Below here and rate can ease toward USD1.4220/10. Asian account offers noted at USD1.4295, with Swiss accounts sell interest seen at USD1.4315 ahead of stops placed on a break of USD1.4320.
EURGBP closed in NY at stg0.8618, the rate nudging up to stg0.8622 in early Asian trade (NY high stg0.8623) before easing back to stg0.8604. Rate currently trades around stg0.8618 into early Europe. Offers seen placed from stg0.8622 through to stg0.8630, a break to open a move on toward stg0.8640/45 ahead of stg0.8650/55. Support stg0.8605/00, a break to allow for a deeper move toward stg0.8590/85 ahead of stg0.8575/70.
Currency market reactions to data and other events could continue to be rather fickle for some time yet, given the still-rampant uncertainties relating to growth and also the low-liquidity summer environment, Said analysts.
Analysts said there's scope for the local unit to resume its climb higher if U.S. consumer confidence numbers due later surprises on the upside.
European Consumer Prices Fell More Than Estimated in July
Prices in the 16-member euro region fell 0.7 percent from the year-earlier month after declining 0.1 percent in June, the European Union statistics office in Luxembourg said today. The decline exceeded the 0.6 percent estimate published on July 31 and the median forecast of 30 economists surveyed byBloomberg News. In the month, prices declined 0.7 percent. Companies from Carrefour SA to Unilever have offered discounts to encourage consumers to spend just as a 39 percent drop in oil prices over the past year is pushing down inflation. The European Central Bank on Aug. 6 kept its Key interest rate at a record low to support the economy, with President Jean-Claude Trichet saying inflation will turn positive later this year.
Afternoon Forex Overview
The U.S. dollar slipped versus the Japanese yen and was little changed versus the euro Friday after the government said its consumer price index was unchanged in July, as analysts expected and easing concerns about inflation.The dollar bought JPY94.86, down from JPY95.32 in North American trade late Thursday.Japan's currency had been advancing throughout the session, though, garnering support on its safe-haven status.Among the three most traded currencies - yen, euro and dollar - the yen is seen as the safest bet now.Recovery in the U.S. appears under question as the dollar again nears its lowest levels of 2009 versus the euro. The July U.S. retail sales report disappointed Thursday, and could drive economists to revise third quarter U.S. gross domestic products lower.U.S. consumer prices fell last month at their fastest annual pace since 1950, an indication that inflation isn't a threat to the economy or the Federal Reserve - likely to keep U.S. interest rates and the yield on the dollar low.Market expectationEURUSD ebbing lower as euro-yen provides weight and as pair tracks cable lower, US stock futures easing lower and perhaps offering some risk-related pressure as well. Backdrop of chatter of upbeat US IP data ahead perhaps also giving the greenback a boost here, though traders struggling to nail down good correlations in this market. Euro holding marginally above the overnight low at USD1.4253, talk of bids around USD1.4245.Pound slowly squeezing lower extends correction away from pre CPI release recovery highs at USD1.6606 to USD1.6578 at writing. As mentioned earlier next support noted at USD1.6560, a break here may open a deeper move toward USD1.6545/40 with stops below.EURGBP extends corrective pullback through support at stg0.8600, the rate posting fresh intraday lows at stg0.8594 but seen meeting support from reported demand placed between stg0.8595/90. A break here may open a deeper move toward stg0.8585/80. Move seen as sterling picks up decent demand interest and cable edging back above USD1.6600.The yen may also be recovering from recent losses after the Democratic Party of Japan's signaled earlier this week it might tolerate a rising yen if it wins in an election this month, reflecting a view that a strong currency might eventually benefit the ailing economy.
"The cost of living in the U.S. was unchanged in July, underscoring the Federal Reserve’s view that inflation will be contained. The flat reading matc
"The cost of living in the U.S. was unchanged in July, underscoring the Federal Reserve’s view that inflation will be contained. The flat reading matched the median forecast of economists surveyed by Bloomberg News and followed a 0.7 percent increase in June, data from the Labor Department showed today in Washington. Excluding food and energy costs, the so-called core index rose 0.1 percent, also as anticipated.
U.S. Factory Output Likely Rose in July as Auto Plants Reopened
U.S. industrial production probably rose for the first time in nine months after mid-year retooling at automakers and as a federal “cash-for-clunkers” program spurred demand for cars, economists said before reports today. Output at manufacturers, mines and utilities climbed 0.4 percent, erasing the previous month’s decline, according to the median forecast in a Bloomberg News survey ahead of today’s report from the Federal Reserve. Other data may show the cost of living was unchanged in July while consumer confidence rose this month.
U.S. Industrial Production Rose in July as Auto Plants Opened
"U.S. industrial production rose for the first time in nine months in July after mid-year retooling at automakers and as a federal “cash-for-clunkers” program spurred demand for cars.The 0.5 percent increase in output at manufacturers, mines and utilities was more than forecast and followed a 0.4 percent decline in June, Federal Reserve figures showed today in Washington. Capacity utilization, the proportion of plants in use, rose from its lowest since record-keeping began in 1967.
FriAug 14
FriAug 14
2:45am
EUR
French Prelim Non-Farm Payrolls q/q
-0.5%
-0.7%
-1.1%
5:00am
EUR
CPI y/y
-0.7%
-0.6%
-0.6%
5:00am
EUR
Core CPI y/y
1.3%
1.4%
1.4%
8:30am
CAD
Manufacturing Sales m/m
1.9%
0.0%
-4.9%
8:30am
CAD
New Motor Vehicle Sales m/m
-0.6%
-0.9%
0.4%
8:30am
USD
Core CPI m/m
0.1%
0.1%
0.2%
8:30am
USD
CPI m/m
0.0%
0.0%
0.7%
9:15am
USD
Capacity Utilization Rate
68.5%
68.2%
68.1%
9:15am
USD
Industrial Production m/m
0.5%
0.4%
-0.4%
9:55am
USD
Prelim UoM Consumer Sentiment
63.2
69.1
66.0
9:55am
USD
Prelim UoM Inflation Expectations
2.8%
2.9%
2:45am
EUR
French Prelim Non-Farm Payrolls q/q
-0.5%
-0.7%
-1.1%
5:00am
EUR
CPI y/y
-0.7%
-0.6%
-0.6%
5:00am
EUR
Core CPI y/y
1.3%
1.4%
1.4%
8:30am
CAD
Manufacturing Sales m/m
1.9%
0.0%
-4.9%
8:30am
CAD
New Motor Vehicle Sales m/m
-0.6%
-0.9%
0.4%
8:30am
USD
Core CPI m/m
0.1%
0.1%
0.2%
8:30am
USD
CPI m/m
0.0%
0.0%
0.7%
9:15am
USD
Capacity Utilization Rate
68.5%
68.2%
68.1%
9:15am
USD
Industrial Production m/m
0.5%
0.4%
-0.4%
9:55am
USD
Prelim UoM Consumer Sentiment
63.2
69.1
66.0
9:55am
USD
Prelim UoM Inflation Expectations
2.8%
2.9%
Aug 13
ThuAug 13
2:00am
EUR
German Prelim GDP q/q
0.3%
-0.2%
-3.5%
2:45am
EUR
French Prelim GDP q/q
0.3%
-0.3%
-1.3%
3:15am
CHF
PPI m/m
0.0%
0.1%
0.0%
4:00am
EUR
ECB Monthly Bulletin
5:00am
EUR
Flash GDP q/q
-0.1%
-0.5%
-2.5%
8:30am
USD
Core Retail Sales m/m
-0.6%
0.2%
0.5%
8:30am
USD
Retail Sales m/m
-0.1%
0.8%
0.8%
8:30am
USD
Unemployment Claims
558K
545K
554K
8:30am
USD
Import Prices m/m
-0.7%
-0.3%
2.6%
10:00am
USD
Business Inventories m/m
-1.1%
-0.9%
-1.2%
10:30am
USD
Natural Gas Storage
63B
71B
66B
6:45pm
NZD
Retail Sales m/m
0.1%
-0.3%
0.7%
6:45pm
NZD
Core Retail Sales m/m
-0.4%
-0.6%
1.5%
7:30pm
AUD
RBA Gov Stevens Speaks
7:50pm
JPY
Monetary Policy Meeting Minutes
7:50pm
JPY
Tertiary Industry Activity m/m
0.1%
-0.3%
-0.3%
2:00am
EUR
German Prelim GDP q/q
0.3%
-0.2%
-3.5%
2:45am
EUR
French Prelim GDP q/q
0.3%
-0.3%
-1.3%
3:15am
CHF
PPI m/m
0.0%
0.1%
0.0%
4:00am
EUR
ECB Monthly Bulletin
5:00am
EUR
Flash GDP q/q
-0.1%
-0.5%
-2.5%
8:30am
USD
Core Retail Sales m/m
-0.6%
0.2%
0.5%
8:30am
USD
Retail Sales m/m
-0.1%
0.8%
0.8%
8:30am
USD
Unemployment Claims
558K
545K
554K
8:30am
USD
Import Prices m/m
-0.7%
-0.3%
2.6%
10:00am
USD
Business Inventories m/m
-1.1%
-0.9%
-1.2%
10:30am
USD
Natural Gas Storage
63B
71B
66B
6:45pm
NZD
Retail Sales m/m
0.1%
-0.3%
0.7%
6:45pm
NZD
Core Retail Sales m/m
-0.4%
-0.6%
1.5%
7:30pm
AUD
RBA Gov Stevens Speaks
7:50pm
JPY
Monetary Policy Meeting Minutes
7:50pm
JPY
Tertiary Industry Activity m/m
0.1%
-0.3%
-0.3%
Aug 12
WedAug 12
12:30am
JPY
Revised Industrial Production m/m
2.3%
2.4%
2.4%
1:00am
JPY
BOJ Monthly Report
2:45am
EUR
French CPI m/m
-0.4%
-0.4%
0.1%
4:30am
GBP
Claimant Count Change
24.9K
25.3K
21.5K
4:30am
GBP
Average Earnings Index 3m/y
2.5%
2.3%
2.3%
4:30am
GBP
Unemployment Rate
7.8%
7.7%
7.6%
5:00am
EUR
Industrial Production m/m
-0.6%
0.3%
0.6%
5:30am
GBP
BOE Gov King Speaks
5:30am
GBP
BOE Inflation Report
8:30am
CAD
Trade Balance
-0.1B
-0.6B
-1.1B
8:30am
CAD
NHPI m/m
-0.2%
0.0%
-0.1%
8:30am
USD
Trade Balance
-27.0B
-28.4B
-26.0B
10:30am
USD
Crude Oil Inventories
2.5M
0.7M
1.7M
2:00pm
USD
Federal Budget Balance
-180.7B
-175.0B
-94.3B
2:15pm
USD
FOMC Statement
2:15pm
USD
Federal Funds Rate
<0.25%
<0.25%
<0.25%
6:17pm
NZD
Business NZ Manufacturing Index
49.7
46.5
6:48pm
NZD
FPI m/m
0.6%
2.8%
9:00pm
AUD
MI Inflation Expectations
3.5%
3.2%
12:30am
JPY
Revised Industrial Production m/m
2.3%
2.4%
2.4%
1:00am
JPY
BOJ Monthly Report
2:45am
EUR
French CPI m/m
-0.4%
-0.4%
0.1%
4:30am
GBP
Claimant Count Change
24.9K
25.3K
21.5K
4:30am
GBP
Average Earnings Index 3m/y
2.5%
2.3%
2.3%
4:30am
GBP
Unemployment Rate
7.8%
7.7%
7.6%
5:00am
EUR
Industrial Production m/m
-0.6%
0.3%
0.6%
5:30am
GBP
BOE Gov King Speaks
5:30am
GBP
BOE Inflation Report
8:30am
CAD
Trade Balance
-0.1B
-0.6B
-1.1B
8:30am
CAD
NHPI m/m
-0.2%
0.0%
-0.1%
8:30am
USD
Trade Balance
-27.0B
-28.4B
-26.0B
10:30am
USD
Crude Oil Inventories
2.5M
0.7M
1.7M
2:00pm
USD
Federal Budget Balance
-180.7B
-175.0B
-94.3B
2:15pm
USD
FOMC Statement
2:15pm
USD
Federal Funds Rate
<0.25%
<0.25%
<0.25%
6:17pm
NZD
Business NZ Manufacturing Index
49.7
46.5
6:48pm
NZD
FPI m/m
0.6%
2.8%
9:00pm
AUD
MI Inflation Expectations
3.5%
3.2%
Aug 11
TueAug 11
1:00am
JPY
Household Confidence
39.4
39.2
37.6
2:00am
EUR
German Final CPI m/m
0.0%
-0.1%
-0.1%
2:00am
EUR
German WPI m/m
-0.5%
0.1%
0.9%
2:45am
EUR
French Gov Budget Balance
-86.6B
-88.7B
3:19am
JPY
BOJ Press Conference
4:30am
GBP
Trade Balance
-6.5B
-6.3B
-6.2B
4:34am
GBP
DCLG HPI y/y
-10.7%
-11.8%
-12.7%
8:15am
CAD
Housing Starts
132K
143K
138K
8:30am
USD
Prelim Nonfarm Productivity q/q
6.4%
5.2%
0.3%
8:30am
USD
Prelim Unit Labor Costs q/q
-5.8%
-2.3%
-2.7%
10:00am
USD
IBD/TIPP Economic Optimism
50.3
47.4
46.3
10:00am
USD
Wholesale Inventories m/m
-1.7%
-1.0%
-1.2%
7:50pm
JPY
CGPI y/y
-8.5%
-8.8%
-6.7%
9:00pm
AUD
Westpac Consumer Sentiment
3.7%
9.3%
9:30pm
AUD
Wage Price Index q/q
0.8%
0.8%
0.8%
1:00am
JPY
Household Confidence
39.4
39.2
37.6
2:00am
EUR
German Final CPI m/m
0.0%
-0.1%
-0.1%
2:00am
EUR
German WPI m/m
-0.5%
0.1%
0.9%
2:45am
EUR
French Gov Budget Balance
-86.6B
-88.7B
3:19am
JPY
BOJ Press Conference
4:30am
GBP
Trade Balance
-6.5B
-6.3B
-6.2B
4:34am
GBP
DCLG HPI y/y
-10.7%
-11.8%
-12.7%
8:15am
CAD
Housing Starts
132K
143K
138K
8:30am
USD
Prelim Nonfarm Productivity q/q
6.4%
5.2%
0.3%
8:30am
USD
Prelim Unit Labor Costs q/q
-5.8%
-2.3%
-2.7%
10:00am
USD
IBD/TIPP Economic Optimism
50.3
47.4
46.3
10:00am
USD
Wholesale Inventories m/m
-1.7%
-1.0%
-1.2%
7:50pm
JPY
CGPI y/y
-8.5%
-8.8%
-6.7%
9:00pm
AUD
Westpac Consumer Sentiment
3.7%
9.3%
9:30pm
AUD
Wage Price Index q/q
0.8%
0.8%
0.8%
Aug 10
MonAug 10
1:00am
JPY
Economy Watchers Sentiment
42.4
43.4
42.2
2:00am
JPY
Prelim Machine Tool Orders y/y
-72.2%
-72.8%
2:45am
EUR
French Industrial Production m/m
0.3%
-0.1%
2.8%
4:30am
EUR
Sentix Investor Confidence
-17.0
-26.0
-31.3
7:01pm
GBP
BRC Retail Sales Monitor y/y
1.8%
1.4%
7:01pm
GBP
RICS House Price Balance
-8.1%
-9.4%
-17.6%
9:30pm
AUD
NAB Business Confidence
10
4
10:00pm
CNY
Industrial Production y/y
10.8%
11.5%
10.7%
10:00pm
CNY
CPI y/y
-1.8%
-1.7%
-1.7%
10:00pm
CNY
Fixed Asset Investment ytd/y
32.9%
34.2%
33.6%
10:00pm
CNY
NBS Press Conference
10:00pm
CNY
PPI y/y
-8.2%
-8.3%
-7.8%
10:00pm
CNY
Retail Sales y/y
15.2%
15.1%
15.0%
10:50pm
CNY
Trade Balance
10.6B
10.1B
8.3B
10:53pm
JPY
Monetary Policy Statement
10:53pm
JPY
Overnight Call Rate
0.10%
0.10%
0.10%
1:00am
JPY
Economy Watchers Sentiment
42.4
43.4
42.2
2:00am
JPY
Prelim Machine Tool Orders y/y
-72.2%
-72.8%
2:45am
EUR
French Industrial Production m/m
0.3%
-0.1%
2.8%
4:30am
EUR
Sentix Investor Confidence
-17.0
-26.0
-31.3
7:01pm
GBP
BRC Retail Sales Monitor y/y
1.8%
1.4%
7:01pm
GBP
RICS House Price Balance
-8.1%
-9.4%
-17.6%
9:30pm
AUD
NAB Business Confidence
10
4
10:00pm
CNY
Industrial Production y/y
10.8%
11.5%
10.7%
10:00pm
CNY
CPI y/y
-1.8%
-1.7%
-1.7%
10:00pm
CNY
Fixed Asset Investment ytd/y
32.9%
34.2%
33.6%
10:00pm
CNY
NBS Press Conference
10:00pm
CNY
PPI y/y
-8.2%
-8.3%
-7.8%
10:00pm
CNY
Retail Sales y/y
15.2%
15.1%
15.0%
10:50pm
CNY
Trade Balance
10.6B
10.1B
8.3B
10:53pm
JPY
Monetary Policy Statement
10:53pm
JPY
Overnight Call Rate
0.10%
0.10%
0.10%
Aug 9
Aug 9
Filter
vbmenu_register("calfilters");
Date
5:34pm
Currency
Impact
Detail
Actual
Forecast
Previous
Chart
SunAug 9
7:50pm
JPY
Core Machinery Orders m/m
9.7%
2.8%
-3.0%
7:50pm
JPY
Bank Lending y/y
2.1%
2.4%
7:50pm
JPY
Current Account
1.80T
1.42T
1.02T
7:50pm
JPY
M2 Money Stock y/y
2.7%
2.6%
2.5%
9:30pm
AUD
Home Loans m/m
1.1%
1.9%
2.2%
Filter
vbmenu_register("calfilters");
Date
5:34pm
Currency
Impact
Detail
Actual
Forecast
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SunAug 9
7:50pm
JPY
Core Machinery Orders m/m
9.7%
2.8%
-3.0%
7:50pm
JPY
Bank Lending y/y
2.1%
2.4%
7:50pm
JPY
Current Account
1.80T
1.42T
1.02T
7:50pm
JPY
M2 Money Stock y/y
2.7%
2.6%
2.5%
9:30pm
AUD
Home Loans m/m
1.1%
1.9%
2.2%
Wednesday, August 5, 2009
Forex Worldwide Markets
Forex is a buying and selling system also referred to as FX or foreign market exchange. Those concerned in the foreign exchange markets are some of the largest businesses and financial institutions from around the world. They deal in multiple currencies from many nations to produce a balance as some are going to gain money and those who fall down. The basics of forex are similar to the form of dealing found in any country, only much bigger and complex. Forex buying and selling involves individuals, currencies and trades from around the world, between every last country.
Different currency rates happen and change every day so the measure of the dollar on one particular day of trading might be different on the next trading day. Forex trading can be hard to keep track of so you must dedicate yourself to keep an eye out on your funds, especially if you have invested a great amount of them, there is a chance you could lose it all. Primarily, trading in the forex exchange occurs in Tokyo in New Your and in London as well as several other spots around the globe.
The types of currency that are commonly traded are the Swiss franc, the Australian dollar, the British pound, the Japanese yen, the Eurozone euro, and the United States dollar. You can cross-trade currencies and you can intermingle one currency trade to another in order to attain supplemental interest and monetary gains.
The regions included where forex trading will start at one hour then shut down as other markets start to open shop. This is seen also in the stock exchanges from around the world, as different time zones are processing orders while making other transactions during various times. What happens in forex trading in a certain country might create various results in another forex exchange as time zones dictate the opening and closing of forex markets. The exchange rates will be varied between forex exchanges, and brokers and day traders alike will want to know the rate changes for each new day before committing money.
The stock exchange is primarily measured on products, prices, and other factors within businesses that could alter the cost of shares. If someone knows what is going to happen before the general public, it is often known as inside trading, using business secrets to purchase or sell stocks on that information — which is punishable by law. There is very little, if any at all inside information in the markets of forex. The monetary trades, buys and sells are all a part of the forex market but very little is based on business secrets, but much more dependent on the status of the currency, economy of any given country.
Code are given to each type of currency on the forex market exchange so no confusion exists when knowing which currency one is investing with at the time. EUR is the symbol for the euro and the US dollar is known as the USD. The GBP is the British pound and the Japanese yen is known as the JPY. If you want to get involved in the forex market and want to contact a brokerage then you should have no problems finding and online brokerage where you can investigate the type of exchanges and profile ahead of throwing your money down the drain.
Forex is a buying and selling system also referred to as FX or foreign market exchange. Those concerned in the foreign exchange markets are some of the largest businesses and financial institutions from around the world. They deal in multiple currencies from many nations to produce a balance as some are going to gain money and those who fall down. The basics of forex are similar to the form of dealing found in any country, only much bigger and complex. Forex buying and selling involves individuals, currencies and trades from around the world, between every last country.
Different currency rates happen and change every day so the measure of the dollar on one particular day of trading might be different on the next trading day. Forex trading can be hard to keep track of so you must dedicate yourself to keep an eye out on your funds, especially if you have invested a great amount of them, there is a chance you could lose it all. Primarily, trading in the forex exchange occurs in Tokyo in New Your and in London as well as several other spots around the globe.
The types of currency that are commonly traded are the Swiss franc, the Australian dollar, the British pound, the Japanese yen, the Eurozone euro, and the United States dollar. You can cross-trade currencies and you can intermingle one currency trade to another in order to attain supplemental interest and monetary gains.
The regions included where forex trading will start at one hour then shut down as other markets start to open shop. This is seen also in the stock exchanges from around the world, as different time zones are processing orders while making other transactions during various times. What happens in forex trading in a certain country might create various results in another forex exchange as time zones dictate the opening and closing of forex markets. The exchange rates will be varied between forex exchanges, and brokers and day traders alike will want to know the rate changes for each new day before committing money.
The stock exchange is primarily measured on products, prices, and other factors within businesses that could alter the cost of shares. If someone knows what is going to happen before the general public, it is often known as inside trading, using business secrets to purchase or sell stocks on that information — which is punishable by law. There is very little, if any at all inside information in the markets of forex. The monetary trades, buys and sells are all a part of the forex market but very little is based on business secrets, but much more dependent on the status of the currency, economy of any given country.
Code are given to each type of currency on the forex market exchange so no confusion exists when knowing which currency one is investing with at the time. EUR is the symbol for the euro and the US dollar is known as the USD. The GBP is the British pound and the Japanese yen is known as the JPY. If you want to get involved in the forex market and want to contact a brokerage then you should have no problems finding and online brokerage where you can investigate the type of exchanges and profile ahead of throwing your money down the drain.
Tuesday, August 4, 2009
Problems for Gold Traders with the Gold Fix
The gold fix is a good guide to the value of gold at one moment in time, and is designed to allow gold traders to trade gold at a fair price.
And, if you are a gold trader with enough money to be involved at the level of the gold fix, it can be efficient: Since there’s such a large pool of liquidity available at one time, as long as there is not excessively large demand or supply, the price should be fair.
The gold fix does create some problems for gold traders, however.
* First, it is only set twice a day, which can be a problem for gold traders who are trading gold on the world’s various markets all day long.
* Second, the cost of entering the market is high through the gold fix: Since physical delivery and storage of the gold has to be arranged, and can be costly, there is very little enthusiasm anywhere for small quantities, and the smallest trade size is somewhere around $500,000. Although a gold trader may be able to find an intermediary that will take a smaller order and aggregate it up with other orders from gold traders, the intermediary will likely charge you a fee for doing so, which can reduce your profits.
* More important, perhaps, is that there may be a conflict of interest in the gold fix. Let’s say you’re a gold trader and you want to buy gold, so you go to one of the LBMA members, a producer, involved in the gold fix. This member must acts in two roles: He must get a bargain price for your gold trade, but he also must get a high selling price for himself. And this is happening a lot, with many gold traders and dealers. Think about what happens if most customers are buyers, and a producer on the LBMA knows this it. It would benefit him not to declare as a seller until the price quoted by the chair has gone up a bit.
The gold fix is a good guide to the value of gold at one moment in time, and is designed to allow gold traders to trade gold at a fair price.
And, if you are a gold trader with enough money to be involved at the level of the gold fix, it can be efficient: Since there’s such a large pool of liquidity available at one time, as long as there is not excessively large demand or supply, the price should be fair.
The gold fix does create some problems for gold traders, however.
* First, it is only set twice a day, which can be a problem for gold traders who are trading gold on the world’s various markets all day long.
* Second, the cost of entering the market is high through the gold fix: Since physical delivery and storage of the gold has to be arranged, and can be costly, there is very little enthusiasm anywhere for small quantities, and the smallest trade size is somewhere around $500,000. Although a gold trader may be able to find an intermediary that will take a smaller order and aggregate it up with other orders from gold traders, the intermediary will likely charge you a fee for doing so, which can reduce your profits.
* More important, perhaps, is that there may be a conflict of interest in the gold fix. Let’s say you’re a gold trader and you want to buy gold, so you go to one of the LBMA members, a producer, involved in the gold fix. This member must acts in two roles: He must get a bargain price for your gold trade, but he also must get a high selling price for himself. And this is happening a lot, with many gold traders and dealers. Think about what happens if most customers are buyers, and a producer on the LBMA knows this it. It would benefit him not to declare as a seller until the price quoted by the chair has gone up a bit.
Getting Your Gold Fix by Trading Gold?
One way to trade gold is to make a deal directly with another gold trader. This, essentially, is what gold traders do when they trade over the counter (OTC), which is a computerized off-floor securities exchange. Essentially, you go the store and see the price one seller is offering, but don’t know what prices other stores are offering at that very moment.
To help make gold trade pricing transparent—essentially, to provide the entire world with the current price of gold—an entity called the London Bullion Market Association (LBMA) sets the standard benchmark for the price of gold.
The LBMA is comprised of major international banks and bullion dealers—that is, entities that own gold—and loosely overseen by the Bank of England.
Twice a day, at 10 a.m. and 3 p.m. London time, five of the LBMA’s members meet to conduct what amounts to a private auction. At that meeting—called the London gold fixing—the chair of the meeting quotes a price of gold. The other members scramble to determine if they (and the customers they are representing) are buyers or sellers at that price. If there are more buyers than sellers, or more sellers and buyers, the chair quotes another price. When the buyers and sellers reach equilibrium, the benchmark price of gold, called the “gold fix,” is established and published widely, both in newspapers and on the Internet.
The gold fix can be very helpful: It gives gold traders an idea of the fair price of gold, at least at twice-a-day intervals. But there are problems with the gold fix, including timing, barriers to entry and conflicts of interest. If you are a gold trader or simply think you might like to trade gold, please see “Problems for Gold Traders with the Gold Fix” for more information.
One way to trade gold is to make a deal directly with another gold trader. This, essentially, is what gold traders do when they trade over the counter (OTC), which is a computerized off-floor securities exchange. Essentially, you go the store and see the price one seller is offering, but don’t know what prices other stores are offering at that very moment.
To help make gold trade pricing transparent—essentially, to provide the entire world with the current price of gold—an entity called the London Bullion Market Association (LBMA) sets the standard benchmark for the price of gold.
The LBMA is comprised of major international banks and bullion dealers—that is, entities that own gold—and loosely overseen by the Bank of England.
Twice a day, at 10 a.m. and 3 p.m. London time, five of the LBMA’s members meet to conduct what amounts to a private auction. At that meeting—called the London gold fixing—the chair of the meeting quotes a price of gold. The other members scramble to determine if they (and the customers they are representing) are buyers or sellers at that price. If there are more buyers than sellers, or more sellers and buyers, the chair quotes another price. When the buyers and sellers reach equilibrium, the benchmark price of gold, called the “gold fix,” is established and published widely, both in newspapers and on the Internet.
The gold fix can be very helpful: It gives gold traders an idea of the fair price of gold, at least at twice-a-day intervals. But there are problems with the gold fix, including timing, barriers to entry and conflicts of interest. If you are a gold trader or simply think you might like to trade gold, please see “Problems for Gold Traders with the Gold Fix” for more information.
Why Trade Gold Instead of Investing in Gold?
Gold has been considered a valuable physical
asset for thousands of years, but many people
shy away from buying it because they think they
can only do so by investing. But there is
another option: trading gold.
The most obvious way to invest in gold is to buy gold in its physical form—that is, bars and coins. The problem with buying gold in its physical form is that doing so involves considerable transportation and storage costs. Moreover, physical gold is relatively illiquid, so it is meant for buy-and-hold gold investors only.
Another option, also in the investing category, is investing in gold stocks, such as mining companies, either individually or through mutual funds. While these investments provide investors with exposure to the gold and are more liquid than physical gold, they don’t offer the pure gold exposure many gold traders demand. Moreover, at times gold stocks will move down with the market as a whole when there is no problem with the company or with gold as an asset, and that can add a level of risk to your investment.
Another option is a gold-related exchange-traded fund (ETF). ETFs are pools of investments that trade on an exchange like stocks. Typically, gold ETFs are intended to track a percentage of an ounce of gold, so in that sense they are a way to trade physical gold. While ETFs can be good for speculators who wish to buy gold or sell it short, there are downsides. You don’t have title to the underlying asset—the gold itself—and administrative fees may be unappealing to some investors.
You can invest in a paper representation of gold, such as futures and options. Futures and options are contracts or options to buy or sell a specific security or commodity (such as gold) at a specific price at a specific time. Futures contracts are used to trade gold in the short-term; rarely does a gold trader take delivery of the gold. While trading gold with a futures contract does have “counterparty” risk—the possibility that the person on the other side of the contract won’t deliver—the fact that gold contracts are traded on established exchanges minimize the possibility of losing money when trading gold.
Gold has been considered a valuable physical
asset for thousands of years, but many people
shy away from buying it because they think they
can only do so by investing. But there is
another option: trading gold.
The most obvious way to invest in gold is to buy gold in its physical form—that is, bars and coins. The problem with buying gold in its physical form is that doing so involves considerable transportation and storage costs. Moreover, physical gold is relatively illiquid, so it is meant for buy-and-hold gold investors only.
Another option, also in the investing category, is investing in gold stocks, such as mining companies, either individually or through mutual funds. While these investments provide investors with exposure to the gold and are more liquid than physical gold, they don’t offer the pure gold exposure many gold traders demand. Moreover, at times gold stocks will move down with the market as a whole when there is no problem with the company or with gold as an asset, and that can add a level of risk to your investment.
Another option is a gold-related exchange-traded fund (ETF). ETFs are pools of investments that trade on an exchange like stocks. Typically, gold ETFs are intended to track a percentage of an ounce of gold, so in that sense they are a way to trade physical gold. While ETFs can be good for speculators who wish to buy gold or sell it short, there are downsides. You don’t have title to the underlying asset—the gold itself—and administrative fees may be unappealing to some investors.
You can invest in a paper representation of gold, such as futures and options. Futures and options are contracts or options to buy or sell a specific security or commodity (such as gold) at a specific price at a specific time. Futures contracts are used to trade gold in the short-term; rarely does a gold trader take delivery of the gold. While trading gold with a futures contract does have “counterparty” risk—the possibility that the person on the other side of the contract won’t deliver—the fact that gold contracts are traded on established exchanges minimize the possibility of losing money when trading gold.
The History of Trading Gold
To understand the value of trading gold, it
helps to know the history of this commodity,
which has been considered a valuable
physical asset for thousands of years.
Since its discovery, gold—because of its
rarity and difficulty to mine—has been
considered a currency and an investment,
used to create political power and settle trades.
In 1946, after World War II ended, the Bretton Woods conference fixed the price of gold at $35 per ounce—and created a gold standard in the United States, meaning that gold backed the U.S. dollar. With the price of gold fixed, trading gold was pointless.
In 1971, the United States, under the leadership of President Nixon, abandoned this system, paving the way for gold trading (although central banks around the world still hold gold for use in times of emergency). This action culminated in 1974, when the United States lifted a 41-year ban on the private ownership of gold by U.S. citizens, allowing individuals to profit from trading gold.
In the nine years following the abandonment of the gold standard, gold prices skyrocketed, rising 2,200% in U.S. dollar terms and peaking higher than $800 in 198—much to the glee of gold traders around the world. But trading gold wasn’t as easy as it seemed: This gold market rally was followed by a 19-year bear market for gold, when gold prices dropped as low as $260 in 1999, much to the gold traders’ chagrin. But the gold market, like other markets, is cyclical, and gold surpassed $800 per ounce again in 2007. In March 2008, gold reached an all-time high of $1002.80, although in real terms—that is, adjusted for inflation—that was well below the $850 peak reached in 1980.
Although it is impossible for gold traders to predict gold prices, we do know one thing: Volatility is the new reality when it comes to trading gold. But that is not necessarily bad: Gold traders can benefit from upturns as well as downturns by buying long or shorting gold. The key to successfully trading gold is finding the trend amid the volatility. In subsequent articles, we will offer tips for doing so.
To understand the value of trading gold, it
helps to know the history of this commodity,
which has been considered a valuable
physical asset for thousands of years.
Since its discovery, gold—because of its
rarity and difficulty to mine—has been
considered a currency and an investment,
used to create political power and settle trades.
In 1946, after World War II ended, the Bretton Woods conference fixed the price of gold at $35 per ounce—and created a gold standard in the United States, meaning that gold backed the U.S. dollar. With the price of gold fixed, trading gold was pointless.
In 1971, the United States, under the leadership of President Nixon, abandoned this system, paving the way for gold trading (although central banks around the world still hold gold for use in times of emergency). This action culminated in 1974, when the United States lifted a 41-year ban on the private ownership of gold by U.S. citizens, allowing individuals to profit from trading gold.
In the nine years following the abandonment of the gold standard, gold prices skyrocketed, rising 2,200% in U.S. dollar terms and peaking higher than $800 in 198—much to the glee of gold traders around the world. But trading gold wasn’t as easy as it seemed: This gold market rally was followed by a 19-year bear market for gold, when gold prices dropped as low as $260 in 1999, much to the gold traders’ chagrin. But the gold market, like other markets, is cyclical, and gold surpassed $800 per ounce again in 2007. In March 2008, gold reached an all-time high of $1002.80, although in real terms—that is, adjusted for inflation—that was well below the $850 peak reached in 1980.
Although it is impossible for gold traders to predict gold prices, we do know one thing: Volatility is the new reality when it comes to trading gold. But that is not necessarily bad: Gold traders can benefit from upturns as well as downturns by buying long or shorting gold. The key to successfully trading gold is finding the trend amid the volatility. In subsequent articles, we will offer tips for doing so.
Why invest in gold?
Gold, a precious metal popular in jewelry, is also a
widely used investment. In fact, as investors have
become more knowledgeable about gold investing,
gold trading platforms (particularly online gold trading
platforms) have proliferated, making it easier than
ever to invest in gold.
There are two reasons to consider investing in gold:
A) Historically, gold has been considered a safe haven in times of economic, geopolitical and financial instability. Inflation and currency devaluation are also positive environments for gold, because it holds its value.
B) Gold investing allows investors to gain financially from increasing gold prices (or decreasing gold prices, in the case of short sellers, but more about that later).
Some of those beneficial gold-investing conditions are present today Including:
First, the world economy has slowed dramatically, with the United States in the midst of a downturn unlike any seen since the Great Depression.
Second, political skirmishes continue around the world: This is evidenced by large numbers of workers in China’s Pearl River Delta region being out of work and the growing problem of drug cartels in Mexico close to many of the manufacturing centers. Furthermore, countries such as the Ukraine are facing problems with their economy that could stall further advances in democratic reform. Even wealthy regions of the world such as the middle east are facing economic problems as a result of the drop in oil prices.
Finally, there are the financial markets, which have plummeted in 2008 and 2009: On February 23, 2009, the Dow Jones Industrial Average and the S&P 500 Index both plummeted to near 12-year lows. Investors are concerned.
At the same time, gold traders are a bit mystified because the S&P/Citigroup Gold & Precious Metals Index, a widely used measure of gold prices, is down 45.46% as of December 31, 2008.
But this simply means there is considerable room for improvement—and significant opportunities for gold investors. Just consider the ratio between the Dow/Gold Ratio, which is calculating by dividing the Dow Jones Industrial Average by the price of an ounce of gold. In the past century, many major economic crises—including the Great Depression and World War II—caused the Dow/Gold Ratio to plummet. So, a low Dow/Gold Ratio is widely considered an indicator of how bad a recession is. And during bad recessions, many investors have tried to preserve their assets by investing in gold, thereby driving up the price of gold. As of February 2009, the Dow/Gold Ratio was below 8, which is historically very low.
How can you take advantage of these conditions? You can do so by trading gold. In subsequent articles we’ll explain how. Many gold trading platforms exist, making it easy to trade gold online.
Gold, a precious metal popular in jewelry, is also a
widely used investment. In fact, as investors have
become more knowledgeable about gold investing,
gold trading platforms (particularly online gold trading
platforms) have proliferated, making it easier than
ever to invest in gold.
There are two reasons to consider investing in gold:
A) Historically, gold has been considered a safe haven in times of economic, geopolitical and financial instability. Inflation and currency devaluation are also positive environments for gold, because it holds its value.
B) Gold investing allows investors to gain financially from increasing gold prices (or decreasing gold prices, in the case of short sellers, but more about that later).
Some of those beneficial gold-investing conditions are present today Including:
First, the world economy has slowed dramatically, with the United States in the midst of a downturn unlike any seen since the Great Depression.
Second, political skirmishes continue around the world: This is evidenced by large numbers of workers in China’s Pearl River Delta region being out of work and the growing problem of drug cartels in Mexico close to many of the manufacturing centers. Furthermore, countries such as the Ukraine are facing problems with their economy that could stall further advances in democratic reform. Even wealthy regions of the world such as the middle east are facing economic problems as a result of the drop in oil prices.
Finally, there are the financial markets, which have plummeted in 2008 and 2009: On February 23, 2009, the Dow Jones Industrial Average and the S&P 500 Index both plummeted to near 12-year lows. Investors are concerned.
At the same time, gold traders are a bit mystified because the S&P/Citigroup Gold & Precious Metals Index, a widely used measure of gold prices, is down 45.46% as of December 31, 2008.
But this simply means there is considerable room for improvement—and significant opportunities for gold investors. Just consider the ratio between the Dow/Gold Ratio, which is calculating by dividing the Dow Jones Industrial Average by the price of an ounce of gold. In the past century, many major economic crises—including the Great Depression and World War II—caused the Dow/Gold Ratio to plummet. So, a low Dow/Gold Ratio is widely considered an indicator of how bad a recession is. And during bad recessions, many investors have tried to preserve their assets by investing in gold, thereby driving up the price of gold. As of February 2009, the Dow/Gold Ratio was below 8, which is historically very low.
How can you take advantage of these conditions? You can do so by trading gold. In subsequent articles we’ll explain how. Many gold trading platforms exist, making it easy to trade gold online.
Gold ends down but off 5-wk lows, eyes US data
NEW YORK/LONDON (Reuters) - Gold ended 1 percent lower on Wednesday as the dollar climbed, oil prices feel and U.S. stocks rose, denting the precious metal’s appeal.
Gold was at 918.80/920.30 by New York’s last quote at 2:15 p.m. EDT, down from $928.45/929.65 late in New York on Monday.
Gold’s decline was “pretty much forex related, and oil is coming down,” said senior Commerzbank trader Michael Kempinski. “We need to see come stronger commodities in general, and a stronger euro, to push gold higher again.”
The dollar rose to its highest level in a month against major currencies, pressuring bullion prices. Gold tends to move in the opposite direction of the U.S. currency, as it is often bought as an alternative investment.
Declining oil prices also dragged gold, as signs of weakening demand for crude and a rising dollar outweighed the supply threat linked to tensions in Iran and Nigeria. U.S. crude futures ended $2.54 lower at $122.19 a barrel.
Gold also dipped as U.S. stocks ticked up, dampening interest in the precious metal as an alternative investment.
“When crude oil goes down, gold also goes down with the stock market going up. Everyone is watching that correlation,” said Adam Hewison, president of MarketClub.com in Annapolis, Maryland.
Hewison said gold should find support at current levels, but the $905 to $912 an ounce area represented a key support area. Should bullion fail to hold there, prices could test the lows set in June below $860 an ounce, he said.
Absent significant moves in oil and the dollar, gold prices should remain rangebound, analysts said, with physical buying muted during the low-demand summer season and exchange-traded funds’ holdings steadying after recent gains.
U.S. gold futures for August delivery settled down $11.20, or 1.2 percent, at $916.50 an once on the COMEX division of New York Mercantile Exchange.
Gold traders awaited release of U.S. economic data this week, including GDP numbers on Thursday and nonfarm payross, construction spending and auto sales data on Friday. These reports could have a significant impact on the dollar.
Traders also looked ahead to Wednesday’s oil inventory data from the U.S. Department of Energy.
“The consensus is looking for another drop of crude oil inventories, which might provide some support for crude oil and thus also for gold,” said Dresdner Kleinwort analyst Peter Fertig.
Among other precious metals, spot platinum hit its highest level in almost a week at $1,775 an ounce, then retreated to end at $1739.00, down from $1,739.00/1,759.00, down from $1,763.00/1,783.00 late in New York on Monday.
Spot palladium was at $380.50/388.50, unchanged from late in New York on Monday. Silver fell to $17.35/17.41 an ounce from $17.46/17.52 late in New York on Monday.
NEW YORK/LONDON (Reuters) - Gold ended 1 percent lower on Wednesday as the dollar climbed, oil prices feel and U.S. stocks rose, denting the precious metal’s appeal.
Gold was at 918.80/920.30 by New York’s last quote at 2:15 p.m. EDT, down from $928.45/929.65 late in New York on Monday.
Gold’s decline was “pretty much forex related, and oil is coming down,” said senior Commerzbank trader Michael Kempinski. “We need to see come stronger commodities in general, and a stronger euro, to push gold higher again.”
The dollar rose to its highest level in a month against major currencies, pressuring bullion prices. Gold tends to move in the opposite direction of the U.S. currency, as it is often bought as an alternative investment.
Declining oil prices also dragged gold, as signs of weakening demand for crude and a rising dollar outweighed the supply threat linked to tensions in Iran and Nigeria. U.S. crude futures ended $2.54 lower at $122.19 a barrel.
Gold also dipped as U.S. stocks ticked up, dampening interest in the precious metal as an alternative investment.
“When crude oil goes down, gold also goes down with the stock market going up. Everyone is watching that correlation,” said Adam Hewison, president of MarketClub.com in Annapolis, Maryland.
Hewison said gold should find support at current levels, but the $905 to $912 an ounce area represented a key support area. Should bullion fail to hold there, prices could test the lows set in June below $860 an ounce, he said.
Absent significant moves in oil and the dollar, gold prices should remain rangebound, analysts said, with physical buying muted during the low-demand summer season and exchange-traded funds’ holdings steadying after recent gains.
U.S. gold futures for August delivery settled down $11.20, or 1.2 percent, at $916.50 an once on the COMEX division of New York Mercantile Exchange.
Gold traders awaited release of U.S. economic data this week, including GDP numbers on Thursday and nonfarm payross, construction spending and auto sales data on Friday. These reports could have a significant impact on the dollar.
Traders also looked ahead to Wednesday’s oil inventory data from the U.S. Department of Energy.
“The consensus is looking for another drop of crude oil inventories, which might provide some support for crude oil and thus also for gold,” said Dresdner Kleinwort analyst Peter Fertig.
Among other precious metals, spot platinum hit its highest level in almost a week at $1,775 an ounce, then retreated to end at $1739.00, down from $1,739.00/1,759.00, down from $1,763.00/1,783.00 late in New York on Monday.
Spot palladium was at $380.50/388.50, unchanged from late in New York on Monday. Silver fell to $17.35/17.41 an ounce from $17.46/17.52 late in New York on Monday.
Trading forex for beginners: introductory guide and tips
One of the most popular trading platforms is the forex trading market. The forex market is one of the most digitalized markets, and is operated completely by phone and online. Users transfer their money from one currency form to another. If traded correctly, this can make profits for the owner of the money as the trades are enacted. Many people like the forex market better than the stock market or other investment platforms because the results are more instantaneous and the market is open all the time. However, trading forex for beginners can be a little overwhelming. There are many processes and systems and charts that are very important to make good trades.
Forex trades are made through an exchange of two separate currencies. This can be something like USD/GBP and so on for almost any currency in the world. The exchanges work because the value of each currency is always changing. When one currency becomes more valuable than it was in the past, this is where the ability to make money comes in. If you purchase a currency when the value is low, when it goes up again, you have made a profit. This is how the forex market works. The pace is very fast, and the currencies are constantly changing values so it can be a very exciting exchange.
When a forex account is opened, you are given a certain amount of money to start with depending on how much you put in. There are also practice accounts that can be used to learn how the system works without risking your actual money. This is a great way to learn how to make trades. Once you have a forex account you study currency trends and fluctuations to determine when to trade in your money for that currency. You can make as many trades as you want for as long as you want. However, there are many forex tips that can help you with the process.
Finding the best forex trading tips is easy, but all the information out there is overwhelming. The best place to start is with the free information. There are many sites online that give step-by-step information and tips to the new forex user. There are blogs, sites, e-books, and many other places where information can be found. Some sites even offer videos of actual trades to outline the steps that make a great trade.
Any bookstore will also have many different books about forex tips and tricks. The best way to decide what book is right for you is to become somewhat familiar with the forex process before heading out to purchase a book. The Š²ŠŃdummiesŠ²ŠŃ books are always a great place to look as they contain a lot of useful information in a simple format. Other than that, books that focus on chart patterns and books that outline how to study forex trends and make trades are all good resources. Some books have been reviewed online, which is a great way to find a good book.
Online there are many programs that can be downloaded to help with the forex process. Some of these help chart patterns and trends, but some other programs actually conduct trades completely on their own. It is important to be careful when looking at such programs. Many of them offer a good amount of tips and help, but some other programs are scams. It is important to find reviews on each program so that you ensure that you obtain a program that will work well with what you want it to do.
Other than these resources, some of the best forex tips come from various lists and sites that offer daily or weekly forex tips. Some sites offer an e-mail newsletter that is full of forex tips. Ask other people who have forex accounts what resources they use to make good trades. All of these tips will help you become great at using your forex account. Just remember that you will probably loose money at first, but you will get it back later. Use your practice account a lot, and remain confident. If you lack confidence, you will not trade wisely. Confidence is one of the number one keys to successful forex traders.
One of the most popular trading platforms is the forex trading market. The forex market is one of the most digitalized markets, and is operated completely by phone and online. Users transfer their money from one currency form to another. If traded correctly, this can make profits for the owner of the money as the trades are enacted. Many people like the forex market better than the stock market or other investment platforms because the results are more instantaneous and the market is open all the time. However, trading forex for beginners can be a little overwhelming. There are many processes and systems and charts that are very important to make good trades.
Forex trades are made through an exchange of two separate currencies. This can be something like USD/GBP and so on for almost any currency in the world. The exchanges work because the value of each currency is always changing. When one currency becomes more valuable than it was in the past, this is where the ability to make money comes in. If you purchase a currency when the value is low, when it goes up again, you have made a profit. This is how the forex market works. The pace is very fast, and the currencies are constantly changing values so it can be a very exciting exchange.
When a forex account is opened, you are given a certain amount of money to start with depending on how much you put in. There are also practice accounts that can be used to learn how the system works without risking your actual money. This is a great way to learn how to make trades. Once you have a forex account you study currency trends and fluctuations to determine when to trade in your money for that currency. You can make as many trades as you want for as long as you want. However, there are many forex tips that can help you with the process.
Finding the best forex trading tips is easy, but all the information out there is overwhelming. The best place to start is with the free information. There are many sites online that give step-by-step information and tips to the new forex user. There are blogs, sites, e-books, and many other places where information can be found. Some sites even offer videos of actual trades to outline the steps that make a great trade.
Any bookstore will also have many different books about forex tips and tricks. The best way to decide what book is right for you is to become somewhat familiar with the forex process before heading out to purchase a book. The Š²ŠŃdummiesŠ²ŠŃ books are always a great place to look as they contain a lot of useful information in a simple format. Other than that, books that focus on chart patterns and books that outline how to study forex trends and make trades are all good resources. Some books have been reviewed online, which is a great way to find a good book.
Online there are many programs that can be downloaded to help with the forex process. Some of these help chart patterns and trends, but some other programs actually conduct trades completely on their own. It is important to be careful when looking at such programs. Many of them offer a good amount of tips and help, but some other programs are scams. It is important to find reviews on each program so that you ensure that you obtain a program that will work well with what you want it to do.
Other than these resources, some of the best forex tips come from various lists and sites that offer daily or weekly forex tips. Some sites offer an e-mail newsletter that is full of forex tips. Ask other people who have forex accounts what resources they use to make good trades. All of these tips will help you become great at using your forex account. Just remember that you will probably loose money at first, but you will get it back later. Use your practice account a lot, and remain confident. If you lack confidence, you will not trade wisely. Confidence is one of the number one keys to successful forex traders.
Making Money With Forex Trading
The foreign exchange market is quickly becoming one of the most popular ways for investors to make some extra money. Also known as the Forex or FX market, it is basically the place where different kinds of currency is traded. Since different currencies hold different values, investors who trade wisely can stand to make rather substantial profits.
In Forex trading, one person trades a quantity of one currency for certain quantities of another. The Forex market is especially attractive to people because it is an ongoing, continuous phenomenon; trading can occur at absolutely any time - 24 hours a day, five days per week. While it helps to have a firm grasp on the essential makeup of the foreign exchange market when trading in it, traders by no means have to be total experts. With a little bit of research and practice, just about anyone can be successful trading in this market.
Everything about the Forex market basically revolves around the Forex rate between two currencies. By studying the Forex rate and keeping a close eye on it, people can take advantage of a falling or rising rate between two currencies. People who participate in this market can choose to invest their money however they want; some choose to focus only on the dynamic between a couple pairs of currencies, while others spread their shares around among many different currencies.
Unlike a traditional market like the stock exchange, there is not a physical, tangible market in the true sense of the word when it comes to Forex. Investors cannot meet at one centralized location to perform their transactions like they would at the New York Stock Exchange. All trading and transactions take place over electronic trading networks and the telephone.
Trading on the foreign exchange market is primarily run by what is known as an interbank market. This is where large corporations, banks, insurance companies and other financial institutions handle and take care of the risks inherent to fluctuations in currencies. How these major institutions trade certain currencies is what basically determines the Forex rate between them - the basis of all foreign exchange market trading.
One of the biggest perks to Forex trading is its high liquidity; large amounts of money can be moved and traded with a minimal price movement. This means that in Forex trading, what you see is pretty much what you get. There are not a lot of hidden fees or other mysterious sums to take into account when trading foreign currencies. This trait of the Forex market is one reason so many people find it easier to deal with than traditional stock exchange markets, and why so many people become so successful at it.
Another reason that Forex trading looks so attractive to investors is its low transaction cost. The cost for most Forex transactions - the spread, or the difference between its buying and selling cost - is built into their price. This increases the transparency of these transactions, adding to their simplicity and the ability for so many people to make real money by engaging in this trading market. Forex truly is much more accessible to larger numbers of people than many other financial markets, and its low transaction cost is a huge reason.
Investors in the Forex market are also quite fond of it due to its good leverage. Forex brokers allow investors to use leverage, or to trade more money than is actually in their account. In this way, Forex can really propel an investor into huge profits, and its also what makes Forex trading so entertaining as well. Using leverage, investors can move much larger sums of money than they otherwise could.
The potential for taking advantage of rising or falling prices is huge in Forex trading. Investors who feel that a particular currency is going to skyrocket can go long and buy a lot of it. By the same token, if an investor feels that a particular currency is going to plummet, they can go short or sell it off. Rules that apply to traditional stock exchanges do not apply to foreign exchange trading, and in many ways that is what makes it so popular.
While the fundamentals of the Forex system can be understood with a little bit of time and practice, the trouble lies in the continuously fluctuating nature of the market. Rates and prices are constantly shifting, mutating and changing; in order to be truly successful in Forex trading, therefore, a person would have to sit in front of their computer all the time to keep an eye on their investments. Most people do not have the time - or the inclination - to do this.
There are many excellent solutions to this issue, however. People who want to get in on the Forex market but understandably lack the time or means to continuously keep track of the many complicated and complex machinations of the system can try using a Forex bot or Forex trading software to manage their transactions for them. Depending on what kinds of currencies an investor usually prefers to trade in, there are plenty of options for software that can handle their trades for them.
When a person is first beginning to learn about Forex, they can purchase a simulation software that will let them practice their hand at Forex trading. This type of software allows a person to use imaginary currency to invest in the Forex market in real time. There is no financial risk to the investor who uses this software; it is strictly to let them get an idea about how the market moves and how the Forex rate can affect different types of currency.
After a person has gotten a better understanding about Forex trading, he can invest in Forex software or a Forex bot that will automatically perform trades for them depending on their specifications. It is possible to get quite adept at understanding the Forex market; one can use Forex software to make a very good profit. However, a person definitely needs to have a decent grasp behind different Forex trading strategies to get the best use out of Forex trading software.
Before putting a lot of time and effort into Forex trading software, it is important to learn some basic Forex trading strategies. A very popular strategy that many Forex traders employ is to try and discern pricing patterns in the Forex rate between two currencies. Using Forex software, these investors track and graph the patterns of the Forex rate over a long period of time. Eventually, a pattern will begin to emerge. The investor then uses this pattern to predict what these currencies will do and how they will behave. Lucrative trades can be made in anticipation of the behavior of these currencies within the Forex trading system.
Prediction and pattern assessment is just one example of many different kinds of Forex trading strategies that people use every day. For every Forex investor, this is generally a different and unique strategy - or blend of strategies. This is also where Forex simulation software can come in handy; people can try their strategies out without risking any real money. If their strategy seems to be fruitful, they can then make a real investment within the actual Forex market.
The best way to come up with a lucrative Forex trading strategy is to focus on a handful of different currencies. This way, an investor can become very familiar with how these currencies behave in the market, and how their Forex rates tend to fluctuate. Many Forex trading strategies revolve around a currency and how it reacts to global events in real time. Some major events in the world can cause a particular currency's rate to rise or fall dramatically. Over time, investors can learn what types of events trigger these movements and capitalize on them.
No matter what strategy an investor chooses to use, the key thing in the Forex market is watching for patterns. Forex trading software and bots are truly the only way to go when it comes to detecting these kinds of patterns and developing strategies. The longer a person studies the Forex market and uses special software, the better and more finely honed their strategies and investments will become. Newcomers must keep these considerations in mind, and over time, they can begin making really good money on the Forex market.
The Forex market and its popularity is sure to continue rising as more and more people discover it. Forex trading software and different Forex strategies all come together to make it possible for virtually anyone to make money on this fluid market. All it takes is a little bit of time and patience, decent Forex software and a sound strategy.
The foreign exchange market is quickly becoming one of the most popular ways for investors to make some extra money. Also known as the Forex or FX market, it is basically the place where different kinds of currency is traded. Since different currencies hold different values, investors who trade wisely can stand to make rather substantial profits.
In Forex trading, one person trades a quantity of one currency for certain quantities of another. The Forex market is especially attractive to people because it is an ongoing, continuous phenomenon; trading can occur at absolutely any time - 24 hours a day, five days per week. While it helps to have a firm grasp on the essential makeup of the foreign exchange market when trading in it, traders by no means have to be total experts. With a little bit of research and practice, just about anyone can be successful trading in this market.
Everything about the Forex market basically revolves around the Forex rate between two currencies. By studying the Forex rate and keeping a close eye on it, people can take advantage of a falling or rising rate between two currencies. People who participate in this market can choose to invest their money however they want; some choose to focus only on the dynamic between a couple pairs of currencies, while others spread their shares around among many different currencies.
Unlike a traditional market like the stock exchange, there is not a physical, tangible market in the true sense of the word when it comes to Forex. Investors cannot meet at one centralized location to perform their transactions like they would at the New York Stock Exchange. All trading and transactions take place over electronic trading networks and the telephone.
Trading on the foreign exchange market is primarily run by what is known as an interbank market. This is where large corporations, banks, insurance companies and other financial institutions handle and take care of the risks inherent to fluctuations in currencies. How these major institutions trade certain currencies is what basically determines the Forex rate between them - the basis of all foreign exchange market trading.
One of the biggest perks to Forex trading is its high liquidity; large amounts of money can be moved and traded with a minimal price movement. This means that in Forex trading, what you see is pretty much what you get. There are not a lot of hidden fees or other mysterious sums to take into account when trading foreign currencies. This trait of the Forex market is one reason so many people find it easier to deal with than traditional stock exchange markets, and why so many people become so successful at it.
Another reason that Forex trading looks so attractive to investors is its low transaction cost. The cost for most Forex transactions - the spread, or the difference between its buying and selling cost - is built into their price. This increases the transparency of these transactions, adding to their simplicity and the ability for so many people to make real money by engaging in this trading market. Forex truly is much more accessible to larger numbers of people than many other financial markets, and its low transaction cost is a huge reason.
Investors in the Forex market are also quite fond of it due to its good leverage. Forex brokers allow investors to use leverage, or to trade more money than is actually in their account. In this way, Forex can really propel an investor into huge profits, and its also what makes Forex trading so entertaining as well. Using leverage, investors can move much larger sums of money than they otherwise could.
The potential for taking advantage of rising or falling prices is huge in Forex trading. Investors who feel that a particular currency is going to skyrocket can go long and buy a lot of it. By the same token, if an investor feels that a particular currency is going to plummet, they can go short or sell it off. Rules that apply to traditional stock exchanges do not apply to foreign exchange trading, and in many ways that is what makes it so popular.
While the fundamentals of the Forex system can be understood with a little bit of time and practice, the trouble lies in the continuously fluctuating nature of the market. Rates and prices are constantly shifting, mutating and changing; in order to be truly successful in Forex trading, therefore, a person would have to sit in front of their computer all the time to keep an eye on their investments. Most people do not have the time - or the inclination - to do this.
There are many excellent solutions to this issue, however. People who want to get in on the Forex market but understandably lack the time or means to continuously keep track of the many complicated and complex machinations of the system can try using a Forex bot or Forex trading software to manage their transactions for them. Depending on what kinds of currencies an investor usually prefers to trade in, there are plenty of options for software that can handle their trades for them.
When a person is first beginning to learn about Forex, they can purchase a simulation software that will let them practice their hand at Forex trading. This type of software allows a person to use imaginary currency to invest in the Forex market in real time. There is no financial risk to the investor who uses this software; it is strictly to let them get an idea about how the market moves and how the Forex rate can affect different types of currency.
After a person has gotten a better understanding about Forex trading, he can invest in Forex software or a Forex bot that will automatically perform trades for them depending on their specifications. It is possible to get quite adept at understanding the Forex market; one can use Forex software to make a very good profit. However, a person definitely needs to have a decent grasp behind different Forex trading strategies to get the best use out of Forex trading software.
Before putting a lot of time and effort into Forex trading software, it is important to learn some basic Forex trading strategies. A very popular strategy that many Forex traders employ is to try and discern pricing patterns in the Forex rate between two currencies. Using Forex software, these investors track and graph the patterns of the Forex rate over a long period of time. Eventually, a pattern will begin to emerge. The investor then uses this pattern to predict what these currencies will do and how they will behave. Lucrative trades can be made in anticipation of the behavior of these currencies within the Forex trading system.
Prediction and pattern assessment is just one example of many different kinds of Forex trading strategies that people use every day. For every Forex investor, this is generally a different and unique strategy - or blend of strategies. This is also where Forex simulation software can come in handy; people can try their strategies out without risking any real money. If their strategy seems to be fruitful, they can then make a real investment within the actual Forex market.
The best way to come up with a lucrative Forex trading strategy is to focus on a handful of different currencies. This way, an investor can become very familiar with how these currencies behave in the market, and how their Forex rates tend to fluctuate. Many Forex trading strategies revolve around a currency and how it reacts to global events in real time. Some major events in the world can cause a particular currency's rate to rise or fall dramatically. Over time, investors can learn what types of events trigger these movements and capitalize on them.
No matter what strategy an investor chooses to use, the key thing in the Forex market is watching for patterns. Forex trading software and bots are truly the only way to go when it comes to detecting these kinds of patterns and developing strategies. The longer a person studies the Forex market and uses special software, the better and more finely honed their strategies and investments will become. Newcomers must keep these considerations in mind, and over time, they can begin making really good money on the Forex market.
The Forex market and its popularity is sure to continue rising as more and more people discover it. Forex trading software and different Forex strategies all come together to make it possible for virtually anyone to make money on this fluid market. All it takes is a little bit of time and patience, decent Forex software and a sound strategy.
Beginners Investor Guide: Stocks
The following guide was created to aid beginner stock market investors in learning all they can about the stock market, why they should invest, and how to get the most out of their investments.
What is the Stock Market?
The stock market is simply a marketplace for the buying an selling of company stock. Companies issue stock, also referred to as shares, as a way of selling partial ownership in that business. Using the stock market, any individual with enough money to do so can buy stock in any company that has shares for sale. Investors purchase shares of companies in the belief that the purchase price will continue to rise, giving those investors a profit when and if the shares are sold.
How are Stock Prices Determined?
Beginner stock investors may hear the term "stock valuation" which is the method used to determine the prices of stocks. The most common of these are Price to Earnings Ratio and a basic valuation of supply and demand.
Price to Earnings Ratio, or P/E Ratio as it is more commonly called, is a fundamental valuation. The P/E Ratio is based on the company's historic ratios and statistics. Using quantifiable characteristics such as these, long term stock prices can be most easily determined.
Simple supply and demand also determines stock value, generally in the short term only. Essentially, when investors wish to purchase a company's stock in large quantities, the price of that stock then rises, making it more attractive and profitable. When investors sell stock in high numbers, stock prices drop.
Why Invest in the Stock Market?
A wise investor attempts to be as financially diversified as possible. Investing in a savings account, money market, CD, or bonds are all wise choices and are very safe locations in which to place money. The stock market is a much more volatile entity than other forms of investments, which allows for the opportunity for great gains along with the risk of great losses.
There are basically two types of investors: those who wish to realize long term profits and those who are after short term gains. Long term investors more often purchase stocks in large quantities and rarely sell their shares soon after purchases are made. These are usually individuals who are saving for retirement or for future generations. Short term investors seek quick turn around on their dollars, purchasing stocks that show promise of raising in price quickly, then selling those stocks for an immediate gain.
Beginner Stock Investors Tips
While investing in the stock market may initially seem to be daunting and even dangerous, it is actually a wise choice to place some savings within the stock market. As long as beginner stock market investors educate themselves before purchasing, they should not have undue reservations about their new assets.
Do not purchase more than is financially feasible. Spending money that one does not have is never a good idea, even when that money is being used as an investment. Also, it is smart to invest first in tax free or tax sheltered accounts like 401(k), IRA, and 529 plans prior to investing in the stock market.
Studying a company prior to making a purchase is a necessity. Be certain that the company has a future ahead of it and has a P/E Ratio that dictates a positive outcome for the investment.
Do not jump on the quick profit band wagon. It is easy to get discouraged when stock prices drop, but that is to be expected when investing in this manner. Do not sell too quickly if the stock(s) purchased is not performing exactly as was anticipated.
Diversify, diversify, diversify. Seek different types of stock in different sectors in order be certain that if a specific industry is struggling, other stocks in the portfolio may perform adequately so as to make up for the losses.
The following guide was created to aid beginner stock market investors in learning all they can about the stock market, why they should invest, and how to get the most out of their investments.
What is the Stock Market?
The stock market is simply a marketplace for the buying an selling of company stock. Companies issue stock, also referred to as shares, as a way of selling partial ownership in that business. Using the stock market, any individual with enough money to do so can buy stock in any company that has shares for sale. Investors purchase shares of companies in the belief that the purchase price will continue to rise, giving those investors a profit when and if the shares are sold.
How are Stock Prices Determined?
Beginner stock investors may hear the term "stock valuation" which is the method used to determine the prices of stocks. The most common of these are Price to Earnings Ratio and a basic valuation of supply and demand.
Price to Earnings Ratio, or P/E Ratio as it is more commonly called, is a fundamental valuation. The P/E Ratio is based on the company's historic ratios and statistics. Using quantifiable characteristics such as these, long term stock prices can be most easily determined.
Simple supply and demand also determines stock value, generally in the short term only. Essentially, when investors wish to purchase a company's stock in large quantities, the price of that stock then rises, making it more attractive and profitable. When investors sell stock in high numbers, stock prices drop.
Why Invest in the Stock Market?
A wise investor attempts to be as financially diversified as possible. Investing in a savings account, money market, CD, or bonds are all wise choices and are very safe locations in which to place money. The stock market is a much more volatile entity than other forms of investments, which allows for the opportunity for great gains along with the risk of great losses.
There are basically two types of investors: those who wish to realize long term profits and those who are after short term gains. Long term investors more often purchase stocks in large quantities and rarely sell their shares soon after purchases are made. These are usually individuals who are saving for retirement or for future generations. Short term investors seek quick turn around on their dollars, purchasing stocks that show promise of raising in price quickly, then selling those stocks for an immediate gain.
Beginner Stock Investors Tips
While investing in the stock market may initially seem to be daunting and even dangerous, it is actually a wise choice to place some savings within the stock market. As long as beginner stock market investors educate themselves before purchasing, they should not have undue reservations about their new assets.
Do not purchase more than is financially feasible. Spending money that one does not have is never a good idea, even when that money is being used as an investment. Also, it is smart to invest first in tax free or tax sheltered accounts like 401(k), IRA, and 529 plans prior to investing in the stock market.
Studying a company prior to making a purchase is a necessity. Be certain that the company has a future ahead of it and has a P/E Ratio that dictates a positive outcome for the investment.
Do not jump on the quick profit band wagon. It is easy to get discouraged when stock prices drop, but that is to be expected when investing in this manner. Do not sell too quickly if the stock(s) purchased is not performing exactly as was anticipated.
Diversify, diversify, diversify. Seek different types of stock in different sectors in order be certain that if a specific industry is struggling, other stocks in the portfolio may perform adequately so as to make up for the losses.
Welcome to the Coins and Currency informational website
Coins and currency are, in simple terms, money and this is what drives a lot of activities. People work for money; they buy things with money and, in many cases, greed is driven by money. There are a lot of things about currency that people do not know; how did currency start and why did each country develop its own type of currency?
In ancient times, there was no currency available to people so a system of bartering was used. This is a system where commodities are traded for each other. Typically, salt, tea, and seeds were the most common items that were traded but this system was clumsy and difficult to use. Bags of salt, of example, are bulky and difficult to trade. Other commodities are perishable making bartering a difficult transaction. Because of the difficulties associated with bartering, a currency system developed.
Around 5000 B.C., the first metal objects were traded in lieu of commodities. These objects were made out of common but semi precious metals that were worth a specific value. By 700 B.C., the Lydians were making their own coins and soon other groups around the world were following suit.
Coins were generally made out of silver and gold and were assigned a value based on how much of the mineral is in it. This is how the value of the coin was determined and, since it was so uncomplicated it rapidly replaced bartering.
It is not known where paper money first originated, but many believe that is was in China at about 950 A.D. Since paper contains no precious minerals, this was the first time that the money itself was not valuable. What makes currency valuable is the public’s attitude that it is worth something and their willingness to accept it. If people don’t think it is worth anything, they will not accept it and money will be worthless; coins and currency have become representative money.
Representative money, by itself, is not worth anything. What makes this money valuable is both the promise of the government and the banks to honor it. This gives the money legitimacy. However, this guarantee was based on the promise to pay equal value for the money in gold or silver.
As the currency systems have evolved over time, it is now called a fiat system. This means that governments have passed laws making it illegal for anyone to refuse to accept the paper currency. For this reason, the term “legal tender” has been added to U.S. currency.
Each country over time has developed a currency system that is their own and has no reason to accept money from another country. They have not backed it so they won’t honor it. There are as many names for the dollar as there are countries; for example, in England it’s the pound, Germany has the deutsche mark, and Japan has the yen. In the United States, the first paper currency was printed in 1862, which was strange timing since the country was in the middle of the civil war and the confederacy was printing its own money. There were only three denominations issued, 5, 10, and 20 dollar bills.
Coins and currency are, in simple terms, money and this is what drives a lot of activities. People work for money; they buy things with money and, in many cases, greed is driven by money. There are a lot of things about currency that people do not know; how did currency start and why did each country develop its own type of currency?
In ancient times, there was no currency available to people so a system of bartering was used. This is a system where commodities are traded for each other. Typically, salt, tea, and seeds were the most common items that were traded but this system was clumsy and difficult to use. Bags of salt, of example, are bulky and difficult to trade. Other commodities are perishable making bartering a difficult transaction. Because of the difficulties associated with bartering, a currency system developed.
Around 5000 B.C., the first metal objects were traded in lieu of commodities. These objects were made out of common but semi precious metals that were worth a specific value. By 700 B.C., the Lydians were making their own coins and soon other groups around the world were following suit.
Coins were generally made out of silver and gold and were assigned a value based on how much of the mineral is in it. This is how the value of the coin was determined and, since it was so uncomplicated it rapidly replaced bartering.
It is not known where paper money first originated, but many believe that is was in China at about 950 A.D. Since paper contains no precious minerals, this was the first time that the money itself was not valuable. What makes currency valuable is the public’s attitude that it is worth something and their willingness to accept it. If people don’t think it is worth anything, they will not accept it and money will be worthless; coins and currency have become representative money.
Representative money, by itself, is not worth anything. What makes this money valuable is both the promise of the government and the banks to honor it. This gives the money legitimacy. However, this guarantee was based on the promise to pay equal value for the money in gold or silver.
As the currency systems have evolved over time, it is now called a fiat system. This means that governments have passed laws making it illegal for anyone to refuse to accept the paper currency. For this reason, the term “legal tender” has been added to U.S. currency.
Each country over time has developed a currency system that is their own and has no reason to accept money from another country. They have not backed it so they won’t honor it. There are as many names for the dollar as there are countries; for example, in England it’s the pound, Germany has the deutsche mark, and Japan has the yen. In the United States, the first paper currency was printed in 1862, which was strange timing since the country was in the middle of the civil war and the confederacy was printing its own money. There were only three denominations issued, 5, 10, and 20 dollar bills.
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