Archive for November 23rd, 2009
GoLearn Forex Analysis 23/11/2009
GBPUSD – A Closer Look by GoLearn Forex
GBP/USD:
Range bound trading continues. It is especially obvious when MA is moving horizontal. Notice on the daily Cable chart below that the 50 SMA has been horizontal since late July while the 100 SMA turned horizontal in late September. The 100 SMA is above 50 SMA which is typical of a falling price environment. Additionally, the last time a complete candle appeared below the 50 SMA price fell an additional 4.54%.
INSERT CHART
If you have been trading support and resistance then you have been very successful recently. The yellow rectangular area indicates upper level resistance. Those who trade pure reversals would look to make short entries there.
Point “A” defined our first high in the range. We make Point “A” the first level of resistance, R1. Points “B” & “C”encroach but never breach R1. These would become Reversal Trades 1 & 2. Point “D” breaches R1 before retracing. Points “E”, “F” and “G” look similar to “A”, “B”, and “C”. Point “H” breaks resistance before retracing its gains.
For Points “B, C, E, F, and G” if you were trading straight S&R you would have fared very nicely. However, for Points “D & H” indicated by the red arches you would have mostly likely been stopped out before picking up the reversal.
With proper risk controls traders will minimize their max loss on every position. A forex trader cannot expect to win on every trade so choosing the best trades and entry points is essential. With the use of Candle patterns, Momentum indicators and Oscillators a trader can time the entry where the lull in momentum begins (blue vertical lines) which may signal a reversal. The Chart below uses the MACD with a histogram to demonstrate falling momentum. The histogram more clearly reveals the convergence of the MACD with the Average. If you wait for 3 full bars with lower highs (red arrows) to form and ensure that price is still at the point of resistance you can avoid tripping a stop loss and possibly end up in another winning forex trade.
INSERT CHART B
Closing in on Official Shopping Season by GoLearn Forex
The DJIA was flat Friday closing the day down just 14.28 points. The week saw the DJIA gain 9/10th of a percent while most Global Equity Markets finished the week in negative territory. The Greenback gained as risk was held in check as the DXY closed above 75.57 in the forex market, for the first time since November 12th.
The Kiwi was the big loser, giving up 3.2% and the cable gave up 1.84% after breaking through near term resistance. The week was marked by global concern over whether the market can sustain their phenomenal 62% gain since the DJIA hit its March lows. Adding to investors worries will be the lack of liquidity in the market through the remainder of the year.
Monday and Tuesday maybe volatile in the Forex Markets as the U.S has Holiday on Thursday. Typically and the preceding Wednesday and following Friday are marked by very light volume days. Friday kicks off the official Holiday shopping season. On the economic data front Canadian Retail Sales are set to print on Monday and PMI in the EUR zone is due out as well. U.S Existing Home Sales will print tomorrow and expect that traders will be watching this closely in light of the poorer than expected new home data that came out last week. A print below expectations should pull even more risk off the table and we would expect the Dollar to strengthen.
Upcoming Forex Events for November 23, 2009
EUR ECB President Trichet Speaks
CAD Core Retail Sales (MoM) Forecast 0.40% Previous 0.50%
CAD Retail Sales (MoM) Forecast 0.60% Previous 0.80%
USD Existing Home Sales Forecast 5.70M Previous 5.57M
Analysis by http://www.golearnforex.net
Daily Review 23/11/2009
USD Dollar (USD)
The Dollar finished the day and the week with gains across the board except against the Yen but fell in the beginning of the trading session on Sunday. The fall in stocks with an increase in risk aversion helped Greenback recover. Wall Street ended Friday in negative. The Dow Jones ended with a loss of 0.14%, The NASDAQ fell by -0.5% and the S&P 500 decreased by -0.32%. The Gold (XAU) rose and closed above the 1050$ an ounce. The Crude Oil closed almost unchanged near the 77.5$ a barrel. Today, The Existing Home Sales expected at 5.7M vs. 5.57M previously.
EURO (EUR)
The Dollar posted gains against the Euro after falling in the last two weeks. The pair is still moving in ranges between the highs of the year at 1.5060 and 1.4800. The rally of the Dollar was not enough on Friday to break below the support. Overall, EUR/USD traded with a low of 1.48 and with a high of 1.4934. Today, The French PMI expected at 55.4 vs. 55.3 previously. The German Manufacturing PMI expected at 51.7 vs. 51.1 previously. The Manufacturing PMI expected at 51.4 vs. 50.7 previously. Also, the ECB President, Jean-Claude Trichet will speak.
EUR/USD – Last: 1.4908
|
Resistance |
1.4900 |
1.4935 |
1.4975 |
|
Support |
1.4800 |
1.4770 |
1.4730 |
British Pound (GBP)
The pair has lost most of the gains achieved during previous days. Due to the forecast of Industrial countries, U.K will keep the interest rate low for extended period till a recovery could be seen. Overall, GBP/USD traded with a low of 1.6460 and with a high of 1.6674. No economic data expected today.
GBP/USD – Last: 1.6505
|
Resistance |
1.6540 |
1.6575 |
1.6620 |
|
Support |
1.6460 |
1.6425 |
1.6355 |
Japanese Yen (JPY)
The Japanese currency still flat in a tight range around 89.00 areas, pair has no clear cues for next trend development. USD/JPY traded with a low of 88.67 and with a high of 89.02. Today, Japanese banks will be closed in observance of Labor Thanksgiving Day.
USD/JPY-Last: 88.83
|
Resistance |
89.15 |
89.40 |
89.65 |
|
Support |
88.80 |
88.60 |
88.30 |
Canadian dollar (CAD)
The Canadian dollar ended lower for a fourth consecutive session, capping off a losing week for the currency in which investor aversion to risk dampened demand for higher-yielding currencies such as the Canadian Dollar. Overall, USD/CAD traded with a low of 1.0613 and with a high of 1.0732. Today, the Core Retail Sales expected at 0.4% vs. 0.5% previously.
USD/CAD – Last: 1.0667
|
Resistance |
1.0785 |
1.0820 |
1.0850 |
|
Support |
1.0655 |
1.0620 |
1.0600 |
Research by http://www.ufxbank.com
Things to be considered while buying forex software
Forex trade deals with the buying and selling of different currencies. As per a survey conducted in the year 2007 the daily turnover of the foreign exchange market is approximately $3.2 trillion. Forex trade has gained immense popularity since the last few years actually from the time it went online. The market is highly liquid and offers the traders the flexibility to trade at anytime. A trader does not require sparing any special hour of the day to trade forex.
Because of the distinctive features of Forex market, it is said to be an almost ideal competition for the state economy. This implies that in contrast to the investments in Wall Street, no brokerage firm, single firm or agency openly weighs the products vended in the foreign exchange market.
The main question is how to begin trading forex. Proper examination and planning are two essential aspects of forex trade. Forex software systems have been designed in order to lower a trader’s burden. The market is flooded with numerous forex trading software having different features. It is essential to choose forex software with great caution, beware of the fraudulent people who try to sell fake software.
Following are a few guidelines that can be used while looking for suitable forex software:
Easy to use: All the forex trading software systems have different features. All of them might look alike but their features and the services rendered by them are different from each other in some respect. It is recommended to purchase forex trading software designed by an actual trader. You must also see to it that the software you are opting for is simple and easy to use.
Security: It is suggested to purchase forex software with a 128 bit SSL encryption. A majority of professionally designed forex software systems are prepared with this feature. This kind of pattern averts your assets from being utilized without your consent. Internet security is quite significant and various forex trading programs are formulated with this significant security feature.
Customer support: While selecting forex software you need to ensure that it offers proper customer support. All good software systems come with unswerving customer support features.
“Trial” Run Features: This is a significant element of information regarding the use Forex trading software application. Most software systems offer the feature of a few trial runs where in you do not need to peril any real money. It is recommended to familiarize with the software prior to starting the trade with real money. At the time of carrying out trial runs, you try to understand how each feature of the software works. It is also a good idea to make use of the “help” or “Introduction” option of the program.
Advertisement
Tags
Recent Posts
- Ringgit, Rupee Lead Increases in Asian Currencies on Enlargement, Rising Rates
- Tropical Tempest Don Figures Off Mexico’s Yucatan on Track for Texas Coastline
- Boehner Wrestles Internal Rivalry on Liability Plan
- Dollar Drops Versus Swiss Franc on Liability Upper Limit Impasse; Yen Pares Gains
- Asian Currencies Fortify to 14-Year Soaring on New Greek Liberate Package