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5 good Forex trading habits

The foreign exchange market, also known as Forex, is full of traders looking to profit from the fluctuating exchange rates of foreign currencies. Whether you're a day trader or simply trade in your spare time, there are several simple ways to improve your success in this prosperous market. By engaging in five easy habits you can make the most of the market while remembering to protect your assets.

Short-term Forex trades versus long-term Forex trades

In the Forex market - also known as the foreign exchange market - traders buy and sell foreign currencies and make money off of the variations in exchange rates. Some traders make short-term trades on a daily basis, while others hold their positions for much longer before making their transaction. Depending on the amount you're willing to risk and the amount of time you have to spend on making trades, you can choose to engage in long-term trading, also called position trading, or short-term trading, often referred to as day trading.

The myths of Forex trading

The Forex market, also known as the foreign exchange market or just FX, is a worldwide financial market where people buy and sell foreign currencies and benefit from discrepancies in exchange rates. The foreign exchange market is one of the largest financial markets in the world and it is estimated that USD 3.5 trillion is traded via this platform every day.


The top 5 trading currencies in the Forex Market- Forex - Forex Trading

The top 5 trading currencies in the Forex Market

Currencies are traded for profit on the Forex Market, with traders speculating on the value of international currencies before exchanging one for another. Opening each day in Australia and closing in New York, Forex operates across international time zones, trading currencies 24/7.

Read on for more on currency trading and the top five Forex traded currencies …

Who trades currencies?

Banks, businesses and individuals each use Forex to trade currencies.

Why trade currencies?

Traders speculate on fluctuations in international currency values to make a profit by trading currencies on the Forex market.

Loonie and Aussie Share Downward Bond

In yesterday’s post (Tide is Turning for the Aussie), I explained how a prevailing sense of uncertainty in the markets has manifested itself in the form of a declining Australian Dollar. With today’s post, I’d like to carry that argument forward to the Canadian Dollar.

Tide is Turning for the Aussie

“Australia is about to enter a boom that should last decades…The Australian dollar is unlikely to go back to where it was, and manufacturing will shrink in importance to the economy, perhaps even faster than it has been.” This, according to Martin Parkinson, Treasury Minister of Australia. While 30 years from now, Mr. Parkinson’s prognosis might probe to be accurate, I’m not so sure it applies to the period 3 months from now. Here’s why:

Emerging Market Currencies Brace for Correction

“It was the spring of hope, it was the winter of despair,” begins Charles Dickens’ The Tale of Two Cities. In 2011, the winter of despair was followed by the spring of uncertainty. Due to the earthquake/tsunami in Japan, the continued tribulations of Greece, rising commodity prices, and growing concern over the global economic recovery, volatility in the forex markets has risen, and investors are unclear as to how to proceed. For now at least, they are responding by dumping emerging market currencies.

NO QE3: What are the Implications for the Dollar?

The verdict is nearly in; there will be no QE3. The second round of quantitative easing (“QE2”) will expire at the end of this month, and while it will not be unwound for quite some time, the Fed has indicated that it will not be followed by yet another round. The question on the minds of forex traders, of course, is what does this mean for the Dollar?

Swiss Franc is the Only Safe Haven Currency

According to conventional market wisdom, there are three safe haven currencies: the Swiss Franc, Japanese Yen, and US Dollar. It is to these currencies that investors flock whenever there is a crisis, or merely an outbreak of uncertainty, and for much of the period following the collapse of Lehman Brothers, the three were closely correlated. As you can see from the chart below, however, one of these currencies has begun to distinguish itself from the other two, leading some to argue that there is now only one true safe haven currency: the Swiss Franc.

Is it Possible to Trade Forex Part-time?

This week, I came across an article in the San Francisco Gate (which, incidentally, has really ramped up its forex coverage over the last year) that addressed this very topic. Given that part-time forex traders probably outnumber those that practice the craft full-time, such an article was long overdue.

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