Tuesday, April 26, 2011


Recently, I wrote about the Euro getting set to replace the U.S. dollar as an international carry trade and as a reserve. The truth is "nothing just happens over night" a series of events would be required to make this happen, some of which would test the ability of the Euro to be a carry trade and check for lapses.
Well, this week the Euro has shown some strong resistance to news that should have pulled it down. The EMU yearly debt/GDP ratio with Greece leading the pack, followed by Ireland, Portugal and then Spain. Joel Kruger a strategist with Daily Fx, reported in his analysis that the debt for the Euro zone soared to a record high of 85.1% in 2010 from 79.3% in 2009. Amazingly, the Euro was unmoved on the news.
In performance, the Euro's relative performance against the USD on Tuesday stood at 0.23% at about 11.00GMT, while rallying to a 16 month peak before lossing momentum for the uptrend just above 1.4650.
How about enriching the vigilant investor,speculator and bankers all alike in exchange for their support in a quest for approval? the pair of EUR/USD might have resumed its bullish uptrend runs. Over the coming weeks, the next critical resistance by the 2009 highs at 1.5145 now looks open for profiting, so if you're trading and hoping to bank some profit of at least 500 pips, so long there is no break and close back below 1.4155 which would negate the bullish uptrend runs, then this is your opportunity.
Presently, daily studies reveals that there is enough room for the pair to run in this direction, a move which is well supported in case of any setback.
If for any reason you dont believe that this might eventually happen, why not check out the list of variouse institutions, ACBs buying the pair EUR/USD for diversification purposes, leverage names, Eastern European, middle eastern and russian keen buyers, this should prove something to any serious trader.
The time is high for changes, the Euro is geared up and ready to coastal along, will you be a part of the trend or would you rather go against it? Remember the saying,"the trend is your friend".

Thursday, April 21, 2011


Performances of the pair EUR/USD in the forex market is revealing some interesting concept for investors and traders alike.
The poor performance of the U.S. dollar as against its other counterpart in the forex market is making the dollar a useful currency in carry trade because of its lower exchange. So that the dollar is fast becoming a dear to international traders for the cheaper exchange making trading alot easier. Meanwhile, the Euro on the other hand is raising in value making it hard to comeby and expensive for international trade.
Huh! a woe of two currency i'ld say, but what effect would the low value on the dollar have on the U.S. economy?

Sunday, April 17, 2011


There is a wave of events crouping across the globe that is very disturbing.
The pair of EUR/USD closed at around 1.4480 two weeks ago rather than moving ahead on the bulls afterward, a chain of events before the closing of trading week ended 15/04/2011, the pair closed within the range of the previouse week at about 1.4425 lossing 55pips in between the two weeks.
soverign debts are eating into the fabrics of the currencies rendering them unsafe for investments, but really what then can safe on a rainy day if the currencies are not safe even enough to claim some pips in themselves?
Where does the investors, bankers and speculators alike seek safety? can the Euro really become a safe haven for the investors? the dollar is fast eroding its ability to shield from loses with the Feds printing more money to protect the US economy from colapse.
The leaders of financial industry are gathering to pave a new way to channel the course of event for the future but will they be able to achieve their goal and implement their objective?.

Sunday, April 10, 2011


Profit or trade pitfall is a common issue among some traders. The feeling is good when your trade nets in profit on any pair you trade. Most newbeses traders and pros some times make the mistake of leaving a trade unclose over the weekends when the trade is in the money.
It is not all trades that can be left unclose. For instance, you've been having a series of bad trades for a while now but luck enough you got on the band wagon when a pair was trading in the money and you net some pips say 150pips in a single trade, now you're feeling cool with yourself about the new profit line and you're so confident that the trade will continue even when the market resumes. One fact you need to understand about the forex market is, no one and I mean no one can accurately predict the price action of the market the next moment, because you were able to score those pips after you got a signal that told you that the market will move 230 pips dont necessarily implies that the market will actually move those 230 pips before it reverses its action.
Price action have been studied over and over and all there exists for these studies are the formulars that came up afterwards.
These are the types of trades that can be left over the weekends.
LONG TERM TRADES: If your trade did not start when the pair took a major reversal either for the bulls or bear, then you definitely want to close every trade that has net you some good pips.
STRATEGIC TRADES: If your trade is not structure after some time tested trading method or automated trader which is able to close unwanted moves against your position or a method that guarranteed that the moves of the market is well provided for or that has an entry and exit strategy included.
You must know that over the weekends alot of activities happens during the weekend which the market must factor into the new weeks trade, hence, you have GAPS which leads to a jump away from the previous close price and the new opening price. So you definitely want to avoid such traps and save yourself the pitfall.
*CARRYOVER COST: Every trading platform charge a cost for trades left over the weekends, such trade cost is deducted immediately the trading day starts again and usually, this cost is usually minimal or negligible when you have a trade in the money.
Trading platforms are designed to earn the operators some good money and whether you lose or profit, the platform will make money off your trades, so why incure losses when you can protect yourself and make profit.


How do you compensate for losses when you ought be profitting? If you were trading off some currency other than the EUR/USD then i beg to say that you just missed some cool 200 pips plus last friday. Events from the past week had indicated that the EUR/USD was on the verge of a major bullish breakout, with price pushing aggressively above trend defining resistance line 1.4215 set from record high in mid july 2008. A breakout above this line further exposed the upsides at 1.4400. The pair broke above 1.4290 on friday soaring high to a one year high closing the move at the end of the day at 1.4480.
EUR/USD posted the highest weekly close since December 2009 raising for the second week in a row and posted a gain of more than 200 pips.
Trading forex is fun most especially when you know what to do when trading and keeping in touch with the spate of events globally.
For some weeks now, the Eurozone has been engulfed with the bail out issue initially from Greece, then Ireland and now Portugal. These bail outs when considered has its root in corruption by Government officials running these countries like private entreprises. The question is who gets to bear the effects of these bail outs?
If you are trading the pair you need understand how such major issues will impact on the pair, then consider the fiscal policies of the Eurozone.
About the time the Portugese Government made the appeal for the bail out the Euro rate hike impacted positively on the pair driving the Euro higher.
In the coming weeks ahead if quality fiscal policies merged with good fundamentals are employed, the Euro may just be gearing up for a move towards the 1.50 boundary.
You definitely dont want be hedging in the wrong pair.