Another <b>Forex Trading strategies</b> tip Blog: Today's Forex And Forex Trading News<BR><BR>

Featured Forex Trading Article

The First Commercially Available Stock Trading "Robot" Which Earns $346.77 Per Week

Intro to Forex Fundamental Analysis

The best course of action to take sometimes isn�t clear until you�ve listed and considered your alternatives. The following paragraphs should help clue you in to what the experts think is significant.

FOREX traders almost always rely on analysis to make plan their trading strategies. There are two basic types of FOREX analysis � technical and fundamental. This article will look at fundamental analysis and how it used in FOREX trading.

Fundamental analysis refers to political and economic conditions that may affect currency prices. FOREX traders using fundamental analysis rely on news reports to gather information about unemployment rates, economic policies, inflation, and growth rates.

Fundamental analysis is often used to get an overview of currency movements and to provide a broad picture of economic conditions affecting a specific currency. Most traders rely on technical analysis for plotting entry and exit points into the market and supplement their findings with fundamental analysis.

Currency prices on the FOREX are affected by the forces of supply and demand, which in turn are affected by economic conditions. The two most important economic factors affecting supply and demand are interest rates and the strength of the economy. The strength of the economy is affected by the Gross Domestic Product (GDP), foreign investment and trade balance.

Indicators

Various indicators are released by government and academic sources. They are reliable measures of economic health and are followed by all sectors of the investment market. Indicators are usually released on a monthly basis but some are released weekly.

Most of this information comes straight from the Forex Fundamental Analysis pros. Careful reading to the end virtually guarantees that you�ll know what they know.

Two of the most important fundamental indicators are interest rates and international trade. Other indicators include the Consumer Price Index (CPI), Durable Goods Orders, Producer Price Index (PPI), Purchasing Manager�s Index (PMI), and retail sales.

Interest Rates - can have either a strengthening or weakening effect on a particular currency. On the one hand, high interest rates attract foreign investment which will strengthen the local currency. On the other hand, stock market investors often react to interest rate increases by selling off their holdings in the belief that higher borrowing costs will adversely affect many companies. Stock investors may sell off their holdings causing a downturn in the stock market and the national economy.

Determining which of these two effects will predominate depends on many complex factors, but there is usually a consensus amongst economic observers of how particular interest rate changes will affect the economy and the price of a currency.

International Trade � Trade balance which shows a deficit (more imports than exports) is usually an unfavourable indicator. Deficit trade balances means that money is flowing out of the country to purchase foreign-made goods and this may have a devaluing effect on the currency. Usually, however, market expectations dictate whether a deficit trade balance is unfavourable or not. If a county habitually operates with a deficit trade balance this has already been factored into the price of its currency. Trade deficits will only affect currency prices when they are more than market expectations.

Other indicators include the CPI � a measurement of the cost of living, and the PPI � a measurement of the cost of producing goods. The GDP measures the value of all goods and services within a country, while the M2 Money Supply measures the total amount of all currency.

There are 28 major indicators used in the United States. Indicators have strong effects on financial markets so FOREX traders should be aware of them when preparing strategies. Up-to-date information is available on many websites and many FOREX brokers supply this information as part of their trading service.

Take time to consider the points presented above. What you learn may help you overcome your hesitation to take action.

By Matthew at http://forex-resource-pro.com/

Forex Snippets

foreign exchange calculator

Forex, FX and the Forex market are some common abbreviations for the Foreign Exchange market. Actually it is the largest financial market in the world, where money is sold and bought freely. In its present condition the Forex market was launched in the seventies, when free exchange rates were introduced, and only the participants of the market determine the price of one currency against the other proceeding from demand and supply. As far as the freedom from any external control and free competition are concerned, the Forex market is a perfect market.
More info on Forex software

foreign exchange risk

Yes, but as a position trader I never use tight stops. Same goes for trailing stops. All very far away from the market not to be taken out by meaningless market noises. Initial stop is always 1% of my total equity, and never commit the whole position at a go but always scale in and scale out.
You can avoid your problem in most cases by leaving the market always by trailing stops, i.e., do not set the profit target. So, any winning trade must be held as long as market does not tell you to leave by hitting your trailing stops. When you enter the market by market signals and leave by stops or trailing stops, it solves the most difficult part of decision making process rather easier for traders.

USD/JPY HINTS
One of the silly rules of thumb in USD/JPY trading is it rarely moves 700-800 pips in a row without 200 pips or more correction in the middle and it almost always retraces back to 350 pips advance point from the start of its 700-800 pips move. All because of liquidity problem in Yen market.
More info on Forex software

foreign exchange student

The Commodity Futures Modernization Act of 2000 (CFMA) made clear that the CFTC has jurisdiction and authority to investigate and take legal action to close down a wide assortment of unregulated firms offering or selling foreign currency futures and options contracts to the general public. The CFTC also has jurisdiction to investigate and prosecute foreign currency fraud occuring in its registered firms and their affiliates. The CFTC issued an advisory in 2001 that discussed these CFMA amendments to the Commodity Exchange Act (CEA), 7 USC 1, et seq.
More info on Forex trading

Forex Trading News From Around The World

European Mid Morning Update 31st March 2008

Mon, 31 Mar 2008 03:21:02 -0500
Incubation conditions are perfect…

Releases from Europe:
Prior Revised
Swiss SECO 2008 GDP Forecasts +1.7% +1.5%

February Forecast Actual
French Producer Prices (MoM) +0.5% +0.4%
French Producer Prices (YoY) +4.9% +4.9%
Italian PPI (MoM) +0.5% +0.7%
Italian PPI (YoY) +5.2% +5.7%
Euro-zone M3 (YoY) 11.5% 11.3%

No surprises from the European data releases so far this morning but there’s plenty to come albeit that nothing is likely to spring much of a surprise. Italian PPI was a touch firmer than forecasts which will keep Trichet vigilant but more emphasis will be placed on this week’s CPI numbers.

The Dollar consequently has remained within Friday’s ranges with the market beginning to give up hope that something will push the boundaries today.

The following economic releases are due today:

March
Euro-zone CPI (Est) (YoY) +3.3%
Italian CPI (P) (MoM) +0.3%
Italian CPI (P) (YoY) +3.1%
Euro-zone Business Climate Indicator 0.70
Euro-zone Consumer Confidence -12.0
Euro-zone Economic Confidence 100.0
Euro-zone Industrial Confidence 1.0
Euro-zone Services Confidence 10.0
U.S. Chicago PMI 46.5

The week has begun relatively quietly with subdued numbers from both Australia and Japan. The latter faces a stronger test tomorrow when the BOJ’s Tankan report is expected to show a substantial decline in corporate outlook as the combination of a stronger Yen and weaker demand threatens to force a hemorrhaging of the country’s export strength.

There are even one or two suggestions of softening in Europe also as the retail PMI’s provided a soggy outlook caused by consumer’s reactions to the threat of higher food and energy prices eating into their wealth.

Recessions are commonly a result of consumers protecting their wealth as they react to destabilizing factors around them. Right now we are seeing how higher credit spreads, tighter credit requirements and ballooning prices provide a spreading dis-ease. Indeed the symptoms are infectious.

The Fed and the U.S. administration have already reacted to this by cutting rates and forcing through fiscal and mortgage plans. The rest of the world has looked on and declared that they are not in the same boat.

Indeed, right now they are right. However, just 10 months ago the U.S. would have said the same. The onset of the symptoms has been more rapid than expected in the States.

While the ECB appears to remain aloof it is quite aware of the risks. It continues to inject liquidity when required and has pulled back sharply from a tightening in monetary policy. It may emit an air of confidence but its actions belay more caution.

If the rest of the world is going to catch the same dis-ease from the States it will come through the consumer. Oil prices and inflation provide the incubation conditions. Combined with persistent tight credit conditions, any lack of confidence in the consumer is going to stem the blood flow from industry.

We can’t say with any confidence that a collapse will occur. However, Japan is already very vulnerable with the strong Yen and reduced export demand. Any LBO failures in Europe and the result could be more devastating that SARS, bird flu and AIDS.

Note important support and resistance areas:

USDJPY EURUSD USDCHF GBPUSD
Res: 100.37-64 1.5901-07 1.0064-08 2.0028-48
Res: 99.80-15 1.5815-37 1.0005-23 1.9910-40

Spt: 98.81-30 1.5725-40 0.9910-15 1.9816-48
Spt: 98.37-54 1.5655-82 0.9846-79 1.9733-56