Welcome to forex tutorial School......: 2012

Sunday, September 23, 2012

Welcome to forex tutorial blog......: What is Forex?,,,,,,

Welcome to forex tutorial blog......: What is Forex?,,,,,,: If you've ever traveled to another country, you usually had to find a currency exchange booth at the airport, and then exchange the ...

What is Forex?,,,,,,

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If you've ever traveled to another country, you usually had to find a currency exchange booth at the airport, and then exchange the money you have in your wallet (if you're a dude) or purse (if you're a lady) or man purse (if you're a metrosexual) into the currency of the country you are visiting.
You go up to the counter and notice a screen displaying different exchange rates for different currencies. You find "Japanese yen" and think to yourself, "WOW! My one dollar is worth 100 yen?! And I have ten dollars! I'm going to be rich!!!" (This excitement is quickly killed when you stop by a shop in the airport afterwards to buy a can of soda and, all of a sudden, half your money is gone.)
When you do this, you've essentially participated in the forex market! You've exchanged one currency for another. Or in forex trading terms, assuming you're an American visiting Japan, you've sold dollars and bought yen.
Before you fly back home, you stop by the currency exchange booth to exchange the yen that you miraculously have left over (Tokyo is expensive!) and notice the exchange rates have changed. It's these changes in the exchanges rates that allow you to make money in the foreign exchange market.
The foreign exchange market, which is usually known as "forex" or "FX," is the largest financial market in the world. Compared to the measly $22.4 billion a day volume of the New York Stock Exchange, the foreign exchange market looks absolutely ginormous with its $5 TRILLION a day trade volume. Forex rocks our socks!
Let's take a moment to put this into perspective using monsters...
The largest stock market in the world, the New York Stock Exchange (NYSE), trades a volume of about $22.4 billion each day. If we used a monster to represent NYSE, it would look like this...

Read more: http://www.babypips.com/school/what-is-forex.html#ixzz27JTY6nN6

ou hear about the NYSE in the news every day... on CNBC... on Bloomberg...on BBC... heck, you even probably hear about it at your local gym. "The NYSE is up today, blah, blah". When people talk about the "market", they usually mean the stock market. So the NYSE sounds big, it's loud and likes to make a lot of noise. But if you actually compare it to the foreign exchange market, it would look like this...

Read more: http://www.babypips.com/school/what-is-forex.html#ixzz27JTfLFgM

Check out the graph of the average daily trading volume for the forex market, New York Stock Exchange, Tokyo Stock Exchange, and London Stock Exchange:

Read more: http://www.babypips.com/school/what-is-forex.html#ixzz27JTlOPBe

The currency market is over 200 times BIGGER! It is HUGE! But hold your horses, there's a catch!
That huge $5 trillion number covers the entire global foreign exchange market, BUT retail traders (that's us) trade the spot market and that's about $1.49 trillion. So you see, the forex market is definitely huge, but not as huge as the media would like you to believe.
Do you feel like you already know what the forex market is all about? We're just getting started! In the next section we'll reveal WHAT exactly is traded in the forex market.

Read more: http://www.babypips.com/school/what-is-forex.html#ixzz27JUM6qOu

Secret tips of forex maney making.......

Make pips

Keep pips

Repeat

If you can repeatedly do these three things, then you're on your way to being a superstar forex trader! But we warn you, it's no cakewalk.
Remember when you were but a little teeny weeny bopper attending grade school?
No?

Well, let us take you through the whole schooling jungle again, but we're doing it FX-Men style.
You'll start schooling by rolling into pre-school with your chocolate milk and snack pack. This is where you'll learn the basics of the forex industry.
Pip Diddy, a former super underwear and sock model and now a fundamental analysis specialist, will take you through Kindergarten where you'll learn the different types of analysis.
If you pass, you'll join the big boys and girls in elementary school where Big Pippin, the coolest cat in the forex block, will teach you all you need to know about technical analysis. But don't worry, we still have nap time in Grade 1. If you pass Grade 1, the next year you'll enter Grade 2, and so on, all the way to the end of the summer school.
Forex newbie carrying forex books

Wait. What's that?
Summer school?
Yep. Summer school.
To make sure you are fully prepared for high school and the awkward challenges you will face, we've added summer school classes to at least help ease your academic transition.
As for trying to get a date for the prom, we can't help you there. Even Dr. Pipslow is still looking for one. And he's 600 years old. Too bad he's forgotten that his prom already happened 583 years ago but we feel bad breaking the news to him.
So....shhhhhhhh. It'll be our little secret.
Aside from dating drama, try not to get senioritis in Grade 12.
Why?
Because our high school goes up to Grade 14! That's how Forex Gump, a former senior macroeconomics professor at Pipvard University and now a blogger of all things related to economics, likes it.

If you've done well throughout grade school and high school, you get a full scholarship to our college! All expenses paid!
We won't even require you to fill out any applications or write essays. That's right....we like to hand out scholarships just as much as we like to hand out cute bunnies to Cyclopip for him to eat.
Our curriculum here at the New School of Pipsology will make a bold attempt to cover all aspects of forex trading.
You will learn how to identify trading opportunities, how to time the market (aka smart guessing), and when to take profits or close a trade.
But that's still not all folks. There's more! After Forex Gump explains the tricks of the trade, you'll head over to the Sophomore part of the school, where Dr. Pipslow, an ancient and revered trader of currencies, will share his nuggets on everything you need to know about the psychology of trading.
Once you finish all your courses and you already feel like you're the next forex trading superstar, Forex Ninja, our resident spy and one of the master traders, will keep you on your toes and remind you of the dangers of the forex jungle.
Forex trading isn't easy, but with a lot of studying and hard work, you can become a successful trader.
So grab your security blanket and favorite teddy bear and let's head over to Pre-Schoo

Read more: http://www.babypips.com/school/?gclid=COfhkqDty7ICFUsb6wodn0UARw#ixzz27IjTuU7I

History of forex trading.................

History
- Foreign exchange earnings date back centuries, to the time when explorers and merchants traveled to distant foreign lands and bartered their goods for items of value from the native population.
Significance
- Foreign exchange earnings are one of the most significant factors affecting the profitability of thousands of companies around the world. Many of them earn more in foreign countries than they do in their own domestic market.
Geography
- Major multinational companies have operations in almost every country in the world, often allowing them to earn profits in dozens of different foreign currencies.
Size
- Foreign earnings account for almost half the profits made by many multi-billion-dollar global companies like Coca Cola, Pepsi, and Procter and Gamble.
Benefits
- The primary benefit of foreign earnings is that companies and countries are not exclusively dependent on domestic consumption. Earning profits in foreign countries helps them to diversify risks and expand opportunities.

ABOEUT FOREX,,,,FAQ...5

Question: What is the difference between FOREX and Futures?

Answer:

Currencies are the money that represent the monetary system from different countries. For example; the Japanese Yen, Canadian dollar, Brazilian Real, Swiss Franc, etc. Futures trading of currencies is done in trading pits, where you are trading those currencies today, but for future prices. FOREX trading is trading actual currencies at today’s exchange rate with banks. All trades are done through brokers or market makers.

ABOEUT FOREX,,,,FAQ...4

Question: How do you make money trading currencies?

Answer:

Currencies are traded on a pip system. A pip is another word for a point in the currency trading arena. Traders are trying to capture points. Depending on the currency, each point is worth a different amount. For example; the British Pound is worth about $10 per point that is traded per lot. If you trade 1 lot and capture 40 points, you just made $400. If you trade 10 lots and capture 40 points, you just made $4,000.00, etc.

ABOEUT FOREX,,,,FAQ...3

Question: What is a margin account?

Answer:

A margin account is a bond account. It is like a savings account. Before you can trade, you need to place a certain amount of money in what is called a margin account. You are guaranteeing other traders that you can pay them if you lose. That account is overseen by your broker. He monitors your account when you trade. He usually will not allow you to risk more than what is in your margin account. The margin account exists so, as you win on a daily basis, they have a place to deposit your money. Conversely, when you lose, they have an account to withdraw the money.

ABOEUT FOREX,,,,FAQ...2

Question: How is currency traded?

Answer:

All currency trading is traded in amounts called LOTS. Each lot has a different amount of currency. For example; a Swiss Franc lot has 125,000 Swiss Francs in it. A trader does not buy lots in order to buy and sell it or trade it. A trader opens a margin account, enabling him the right to trade it.

ABOUT FOREX,,,FAQ,,,,1

Is it possible for me to become a successful Professional Trader?

Simply stated, each country has its own currency. Currency trading occurs when one country’s currency is traded for another country’s currency at the prevailing exchange rate.

Forex Trading : Advice and Tips for beginners.............

If you are new to Forex trading, then there are a number of indicators you need to remember to ensure that you trade only on the right currencies.
Through the course of this guide we will detail: what Forex is, how it works, how to trade successfully… essentially everything you need to know to make your transition into Forex trading every bit of the achievement you want it to be.

Tips to Make Money Fast in Forex.....................

forex money making tips

This is all about making a fortune with Forex. Most traders just go with the flow and make average gains, with this article you will learn what makes some traders stand out and a lot richer than others!
We are going to assume that you know how to trade, and has quite an experience in trading.
With simple changes in your trade selection, money and risk management, and mindset, you can change that average gains into larger ones!
Fast money is in Forex, it is a lifestyle. here is it how its done.

Tip 1 . Embrace Changeability and Risk With a Smile
Forex systems have instability.
If you cannot manage and calculate your risk, then don't ever think about trading in Forex. Many traders back away from forex because of this ( why do you even traded in the first place?). But taking manageable risks has its rewards.
It's just simple, you know what your losing if ever it doesn't work out, yet what you gain is unpredictable but sure is high! That is what I call excitement, my friend.
To a well-educated Forex trader, this is something you shouldn't be afraid of, might as well embrace it.

Tip 2. Trade Less, gain more
Most traders think that if they don't trade, another door has closed, or miss some move. The tendency, they trade frequently. Most of the trades that come big come a few times in a year. Focus on the trades that make the really big gains. Be alert, and informed.

Tip 3. Diversify is a no-no
Most Investors accept the fact that diversification can make money fast - in reality it does exactly the opposite.

Tip 4. Money and Risk Management
This article has been concentrating on the Big gains, because this is your money, so every penny should be controlled, this is where money management kicks in.
Control your risks, but increase your chances of success:
- Give yourself staying power by buying options at or in the money, this prevents you from getting stopped out. Many traders lose not by the market direction, but because they were stopped out by a instable move, and options will give you staying power.
- Keep your stop in its original position - until the move is well in profit, before moving it up.
- Trading fast and selectively - have the courage to trade when you feel it is good. and enjoy the cash.

Tip 5. Compound growth has its benefits
The way to make money fast in forex, is to understand the power of compound growth. For example, if you target 50% a year in your trading, you can grow an initial $20,000 account, to over a million dollars, in under 10 years.
Break the norm, and gain more. Follow
some of these tips and make your way into the big gains!

Forex Trading System for Onlin Currency Exchange........................

Earning through forex market can be healthier affair if one knows few tips about this market. This means educating yourself in various financial areas. Know what is forex market is point to point. The value of currency in all the countries of the world change time to time so one must keep an eye on all these to get the maximum output from forex market.
Without any prior knowledge of foreign market trading and investment, landing into forex market is not advisable. If one land without any knowledge it will be like inviting the risk factor in this kind of trading.

How to right away Trade Like You Have Decades of Forex Trading knowledge....................

Today i will share tips about making money in forex,,,,,,,,,,

Earnestly examine forex signals if you are not yet trading profitably, bonk constricted contribute, or fair don't hump often term to dedicate to your forex trading.

From the naive one net mail a day difference to the forex mentor who sits with you all day holding your power as you dealing, a portfolio of forex swap alerts can be virtually uncommitted and can alter you into a juicy mercantile instantly.

If same us you've ever analysis a understand and settled your own trades, you leave virtually certainly acquire also sat in lie of your screen wonder if you were doing the right thing.

Questions suchlike "bed I entered this transactions too tardy?" and "am I trading in the honorable itinerary (longish when I should be truncate)" module certainly screw entered your obey.

How umpteen times love you wished you had an proficient merchandiser with decades of participate guiding your trades, safekeeping you out of serious trades, and pointing you towards trades with a higher calculate of success ?

We were sure in that spot umpteen times in the wee days, but ever imagined the spending of having an skilled on assistance would far dominate any redundant profits we mightiness eliminate. It turns out we were quite evil.

There are frequent services gettable, known variously as forex signals, forex alerts, or forex tips.

Trading signals amount in a tracheophyte of formats, suited to how over much of your day you can devote to trading. And yes beware, there are loads of scams out there too, but we'll guide you how to avoid them, and we'll nonstop you towards the amended ones.

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In their simplest meeting a forex trading signaling leave beam you a forex sleepless email rest a day database class set ups for the close 24 hours

bye,,,,,,,,if you have any question just comment,,,,

Algorithmic trading…………………………

Algorithmic trading

Algorithmic trading or automated trading is also know as Algo, Black-Box or Robo trading. It represents the use of electronic platforms for entering trading orders (such as Long and Short) with an algorithms that are deciding on aspects like timing, price or quantity of the order and initiating the orders without human intervention.
Hight Frequency Trading (HTF) is a special class of algorithmic trading in which application makes decisions and initiates orders automatically. Decisions are based on electronically received informations before human traders even process the information they observe. This kind of trading dramatically change the microstructure of market, particularly in the liquidity way.
According to Aite Group (Financial services industry research), in 2006, third of all United States and Europen Union stock trades were driven by automated applications (algorithms).
Of course, one of the main issues regarding Algorithmic Trading is difficulty in determing how profitable is this kind of trading. In August 2009, TABB Group (Financial Services industry research firm) released a report estimating that 300 securities firms that specialize in Algorithmic Trading took (roughly) US$21 billion in profits in 2008.
HFT and Algorithmic Trading become the subject of public debate since the “US Securities and Exchange Commission” along with “Commodity Futures Trading Commission” said that they contributed to some of the volatility during the “2010 Flash Crash” when the Dow Jones suffered second largest intraday point swing ever to that date (though prices has been quickly recovered).
Algorithmic trading Strategy’s
Algorithmic strategies are implemented by using modern programming languages. Increasingly, the algorithms that are used by larger brokerages and asset managers are written to the FIX Protocol’s Algorithmic Trading Definition Language (FIXatdl). It allows firms to receive orders and exactly specify how electronic orders should be expressed. Orders that are built using these algorithms can be transmitted via FIX Protocol.
Some of strategies that are used by Algorithmic Trading are:
Trend following – Here system aims to work on market trend mechanism and take benefit from both sides of market, enjoying the profits from ups and downs of the stock or futures market.
Pair Trading – A market neutral strategy that enables traders to profit from ant market conditions: uptrend, downtrend or sidewise movement. It is categorized as “Statistical Arbitrage” and “Convergence Trading Strategy”.
Delta neutral strategies – In finance, it describes a portfolio of related financial securities. Portfolio’s value, due to small changes in underlying security, remains unchanged. Such portfolio contains of options and their corresponding underlying securities such positive and negative delta components offset, resulting in the portfolio’s value being insensitive to changes in the value of the underlying security.
Arbitrage – Is the practice of taking advantage of price difference between two of more markets. Also, when used by academics, an arbitrage consists of transaction that involves no negative cash flow at any state and positive cash flow in at least one state. In simple terms, Arbitrage is the possibility of risk-free profit at zero cost.
Mean Reversion – A mathematical methodology sometimes used in stock investing but it also can be applied to other processes. Idea is that, deviations from the average price are expected to revert to the average.
Scalping – Represents a method of arbitrage of small price gaps that are created by the spread of bid and ask. This method requires quick position establishing and liquidating, usually within minutes or seconds.
Most of the Algorithmic Trading strategies belongs to “cost-reduction” category. Mainly because large orders are broken down into smaller orders and are entered into the market over time. This is basic strategy that is also called “Iceberging”. An algorithms that are designed with main purpose to find hidden or “Iceberg” orders are called “Stealth” (developed by the Deutsche Bank)

What is the leverage?……

hi, friends today i will share about leverage of forex trade …..

What is the leverage?

Leverage is a loan provided to an investor in order to trade huge amounts of foreign exchange currency. If for example an investor is trading with a leverage of 1:100, he has the opportunity to trade $1,000 by making use of only $10 of his own funds. In essence, the investor has made a use of a loan amounting to $990 i.e 99% of the total value required for a trade of $1,000. It is usual for forex brokers to charge interest on the borrowed amount. However Agea does not charge any interest.
An investor can profit in the forex market by the use of leverage but on the other hand leverage can work against investors. If the currency underlying a trade moves in the expected direction then investors will make much larger profits than they would have if they did not have any leverage but if the currency moves in the opposite direction then leverage will greatly amplify the potential losses. Forex brokers close out open trades as soon as the investors’ available balance reaches 0(zero), so you cannot lose more than the funds held in your forex account.

thanks for being with us

Forex Glossary……........

hi friends today i will share witi you forex glossary it will help you to trade in forex….

Forex Glossary

Traders often chat with one another about a variety of topics related to financial markets, giving their perspectives and discussing trading ideas and current moves on the markets. While communicating with each other they often use slang to express their thoughts in a shorter form. Some of the most popular slang is listed below.
Choose a starting letter
A    B    C    D    E    F    G    H    I    J    K    L    M    N    O    P    Q    R    S    T    U    V    W    Y    Z
A
1.    API / API Trading: Application Programming Interface / Trading done through an API
2.   Appreciation: A currency strengthening in response to market demand
3.    Arbitrage: The purchase or sale of an instrument and simultaneous taking of an equal and opposite position in a related market, in order to take advantage of small price differentials between markets. Arbitrage exists as a result of market inefficiencies. People who engage in arbitrage are called arbitrageurs
3.   Ask (Offer) Price: The price at which sellers are willing to sell a currency pair
4.    Aussie: Slang term used to refer to the Australian dollar.
5     . AUD: Australian Dollar
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B
6.    Balance of payments: The difference between the amount of exports and imports of a country in a specified period of time. A negative balance of payments means that more money is flowing out of the country than coming in.
7.    Bank of Japan (BOJ): Japan’s Central bank
8.    Bank of Canada (BOC): Canada’s Central bank
9.    Bank of England (BOE): England’s Central bank
10.    Base currency: The first currency listed in a currency pair.
11. Basis point: A unit that is equal to 1/100th of 1% (0.01%)
12.    Bear Market: A market in which prices decline sharply in a contest of widespread pessimism.
13.    Bearish: A bearish investor believes that a particular security, sector, or the overall market is about to fall.
14.     Beta: A figure that indicates the historical propensity of a stock price to move with the stock market as a whole.
15.   Bid Price: The price a buyer is willing to pay for a security.
16.   Book: The summary of a trader’s or desk’s total positions.
17.   Breakout: The movement of a price out of an established trading range.
18.   Bretton Woods: An agreement signed in 1944.
19.   BRICs: An acronym for Brazil, Russian, India, and China.
20. Broker: A firm or an individual that acts as an intermediary, putting together buyers and sellers for a fee or commission.
3.    Broker/Dealer: An individual or firm in the business of buying and selling securities for itself and others.
14.     Bollinger Band: A technical analysis tool that can be used to measure the highness or lowness of the price relative to previous trades.
Bullish: A bullish investor believes that a particular security, sector, or the overall market is about to rise.
Bull Market: A market characterized by rising prices.
Bull Trap: Any technically unconfirmed move to the upside that encourages investors to be bullish. Usually precedes important declines and often fools those who do not wait form confirmation by other indicators.
Bundesbank: Germany’s Central bank, also called Buba.
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C
Cable: Term used to refer to the GBP/USD rate.
CAD: Canadian Dollar.
Call Option: An agreement that gives an investor the right, but not the obligation, to buy a stock, bond, commodity, or other instrument at a specified price within a specific time period.
Candlestick Chart: A candlestick chart is a style of bar-chart used primarily to describe price movements of a security, derivative, or currency over time. Candlesticks are usually composed of the body (black or white), and an upper and a lower shadow (wick): the area between the open and the close is called the real body, price excursions above and below the real body are called shadows. The wick illustrates the highest and lowest traded prices of a security during the time interval represented. The body illustrates the opening and closing trades. If the security closed higher than it opened, the body is white or unfilled, with the opening price at the bottom of the body and the closing price at the top. If the security closed lower than it opened, the body is black, with the opening price at the top and the closing price at the bottom.
Carry Trade: A carry trade is a strategy in which an investor borrows money at a low interest rate in order to invest in an asset that is likely to provide a higher return.
CBOE: Chicago Board Options Exchange, world’s largest options exchange.
CBOT: Chicago Board of Trade, world’s oldest futures and options exchange.
Cost of Carry: Expenses incurred for helding a position.
Central Bank: A nation’s principal monetary authority which regulates the money supply and credit, issues currency, and manages the rate of exchange.
CFDs: Contracts for difference.
CFTC: U.S. Commodity Futures Trading Commission, an independent agency of the United States government that regulates futures and option markets.
CHF: Swiss Franc.
CME: Chicago Mercantile Exchange.
CNY: China Yuan Renminbi.
Collateral: Something given to secure a loan or as a guarantee of performance.
Contagion: A negative occurrence in one market, industry, or country that impacts other markets, industries, or countries.
Commission: Transaction fee charged by a broker.
Counterparty: The other partecipant in a financial transaction.
Correlation: A statistical term that.
CPI: Core Price Index, monthly measure of the change in the prices of a defined basket of consumer goods.
Currency: Any form of money, coin and paper money, issued by a central bank or a government.
Currency Pair: The two currencies in a foreign exchange transaction. The first currency of a currency pair is called the base currency, and the second currency is called the quote/counter currency.
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D
Day Trader: A trader who tries to profit from short-term price movements, often taking and closing a position within the same trade day.
Dealer: A firm or an individual that acts as a principal and stands ready to buy and sell for its own account.
Deficit: A negative balance of trade or payments.
Deflation: The opposite of inflation. A decrease in the price of goods and services in an economy.
Demo account: A demo account is a practice account that allows investors to understand the trading platform and the market.
Depreciation: The loss of value of a country’s currency with respect to another one.
Derivative: A financial contract whose value is based on an underlying asset such as a stock or bond, a commodity, a market index etc.
Devaluation: A decrease in the exchange rate for a currency as a result of central bank intervention. The opposite of Revaluation.
Dividend: A share of the profits received by a stockholder.
Dovish: A docile, gentle tone. Statements perceived to be dovish can give indications of weakness in a currency or in a monetary policy.
Dow Jones: One of the most closely watched and important stock market indexes.
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E
ECN: Electronic Communication Network. An electronic system that brings buyers and sellers together for the electronic execution of trades.
Economic calendar: A calendar used by traders for the purpose of tracking the occurrence of market-moving events.
Economic indicator: A government issued statistic that indicates current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.
EFSF: European Financial Stability Facility, a special purpose vehicle (SPV) financed by members of the eurozone to combat the European sovereign debt crisis.
ETF: Exchange Traded Funds.
Euro: The official currency of the eurozone. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.
European Central Bank (ECB): The Central Bank of the European Union. It administers the monetary policy of the 17 EU Eurozone member states.
Exotic Currency: A thinly traded currency.
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F
Federal Reserve (Fed): The Central Bank of United States.
First in first out (FIFO): All positions opened within a particular currency pair are liquidated in the order in which they were originally opened.
FOMC: Federal Open Market Commitee.
Foreign Exchange (Forex): An over-the-counter market where buyers and sellers conduct foreign exchange transactions.
Forward Contract: A non-standardized contract between two parties to buy or sell an asset at a specified future time at a price agreed today.
Fundamentals: The macro economic factors that are accepted as forming the foundation for the relative value of a currency, these include inflation, growth, trade balance, government deficit, and interest rates.
Fundamental Analysis: Analysis based on economic and political factors.
Futures Contract: A standardized contract between two parties to exchange a specified asset of standardized quantity and quality for a price agreed today with delivery occurring at a specified future date.
FX: Abbreviation for Foreign Exchange (Forex).
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G
G7: The meeting of the finance ministers from a group of seven industrialized nations.
G8: A forum, created by France in 1975, for the governments of seven major economies: Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.
G20: A group of finance ministers and central bank governors from 20 major economies: 19 countries plus the European Union, which is represented by the President of the European Council and by the European Central Bank.
GBP: Great Britain Pound.
Gold: A precious metal.
Gold Standard: A monetary system in which the standard economic unit of account is a fixed mass of gold.
Gross Domestic Product (GDP): The market value of all final goods and services produced within a country in a given period. GDP per capita is often considered an indicator of a country’s standard of living, even if it is now often replaced by the Gini Index.
Gross National Product (GNP): The market value of all products and services produced in one year by labor and property supplied by the residents of a country.
Good Till Cancelled Order (GTC): An order that will stay in the market until you cancel it and it is the default order duration type.
GTD (Good Till Date): An order that will stay in the market until a date you specify.
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H
Hawkish: An aggressive tone.
Head and Shoulder: A technical analysis term used to describe a chart formation.
Hedge: The purchase or sale of options or futures contracts as a temporary substitute for a transaction to be made at a later date. Usually it involves opposite positions in the cash or futures or options market.
Hedge funds: Funds available only to sophisticated investors like wealthy individuals and institutions that utilise wide range of investment strategies and methods.
Hedging: A hedging transaction is one whose main aim is to protect an asset or liability against a fluctuation in the foreign exchange rate rather than profit from the exchange rate fluctuations.
Hyperinflation: A period of extreme inflation.
HKD: Hong Kong Dollar.
HUF: Hungarian Forint.
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I
IDR: Indonesian Rupiah.
ILS: Israeli New Shequel.
INR: Indian Rupee.
IMF: International Monetary Fund.
Inflation: A sustained increase in the general level of prices for goods and services.
Intervention: Action by a central bank to alter the value of its currency by entering the market.
In-the-money: Situation in which an option’s strike price is below the current market price of the underlier (for a call option) or above the current market price of the underlier (for a put option).
IOC (Immediate Or Cancel): An order that will be executed immediately (if other order conditions are met) or cancelled.
ISDA: International Swaps and Derivatives Association.
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J
JPY: Japanese Yen.
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K
Kiwi: Slang for the New Zealand Dollar.
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L
Lagging indicators: Economic indicators that change after the overall economy has changed. In some cases a lagging indicator can become a leading indicator or vice versa. Lagging indicators are not helpful to predict future economic activity.
Leading indicators: Economic indicators used to predict future economic activity.
Leverage: The ability to control large dollar amounts of a commodity with a comparatively small amount of capital. Some brokers offer leverage starting from 1:1 up to 1:500.
LIBOR: London Interbank Offered Rates. An interest rate at which banks can borrow funds, in marketable size, from other banks in the London interbank market. The LIBOR is fixed on a daily basis by the British Bankers’ Association.
Limit order: A limit order is an order to buy below the current price, or sell above the current price. For example, if an instrument is trading at 129.34 / 129.38 and you believe the market will rise, you could place a limit order to buy at 129.28. If executed, this will give you a long position at 129.28, which is 10 pips better than if you had just used a market order. The disadvantage of the limit order is that if the instrument moves straight up from 129.34 / 129.38 your limit at 129.28 will never be filled and you will miss out on the profit opportunity even though your view on the direction was correct. Opening a position with a limit order is usually appropriate if you believe that the market will remain in a range before moving in your anticipated direction, allowing the order to be filled first.
Liquidity: The ability to sell or buy a currency pair without causing an impact on the price.
Loonie: Slang for Canadian Dollar.
Long position: The purchase of a security, currency or commodity with the expectation of an increase in the market price. The opposite of a short position.
Lot: The standard transaction size in a forex transaction.
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M
Major pairs: The most traded currency pairs in the world.
Margin: Collateral in cash or other securities the trader has to deposit with the forex broker to cover some or all of the value of traded currencies in the forex account.
Margin Call: A request from a broker or dealer for additional funds or other collateral to guarantee performance on a position that has moved against the customer.
Maturity: The date of expiry or settlement of a financial instrument.
MetaTrader 4: An online trading platform created by Metaquotes.
Monetary Policy: Actions taken by a Central Bank to influence the money supply or interest rates.
The total amount of money available in an economy at a specific time.
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N
NFA: National Futures Association.
NFP: Non Farm Payroll.
NZD: New Zealand Dollar.
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O
Over the Counter (OTC): Any transaction that is not conducted over an exchange.
Overnight Position: A position not closed at the end of the trading day and held overnight.
Order: An instruction to execute a trade at a specific price.
Overvalued: A security that is trading above its perceived value.
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P
Pip: Pip or point is the smallest increment in a currency pair.
POMO: Permanent Open Market Operations, The purchase or sale of Treasury securities on an outright basis to add or drain reserves available in the banking system.
Profit Taking: Closing a position in order to secure a gain.
Purchasing Power Parity (PPP): A condition between countries where an amount of money has the same purchasing power in different countries.
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Q
Quantitative Analysis: An analysis technique applying mathematics stochastic calculus to finance.
Quantitative Easing (QE): An unconventional monetary policy used by central banks to stimulate the national economy when conventional monetary policy has failed.
Quote: An indicative market price.
Quote Currency: The second currency quoted in a currency pair in forex.
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R
Rally: Recovery in prices after a period of sharp declines.
Range: The difference between the highest and lowest price of a currency pair during a given trading period.
Rate: Price at which a currency can be purchased or sold against another currency.
RBA: Reserve Bank of Australia.
RBNZ: Reserve Bank of New Zealand.
Recession: A general slowdown in economic activity.
Reserve Currency: A currency that is held in significant quantities by many governments and institutions as part of their foreign exchange reserves.
Resistance: A technical analysis term that refers to a price level in a stock, currency or commodity where selling pressure is likely to exceed the buying pressure, forming a top or ceiling that blocks further upside movements in the instrument. The opposite of Support.
Retail Foreign Exchange Dealer (RFED): An individual or organization which acts, or offers to act, as a counterparty to an off-exchange foreign currency transaction with a person who is not an eligible contract participant.
Retail Sales: A measure of consumer spending over a given period of time.
Revaluation: An increase in the exchange rate for a currency as a result of central bank intervention. The opposite of Devaluation.
Rollover: The net interest return on a currency position held by a trader.
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S
SEC: Security and Exchange Commission.
SEK: Swedish Krona.
Settlement: Actual physical exchange of one currency for another.
SGD: Singapore Dollar.
Short position: The sale of a borrowed security, currency or commodity with the expectation of a decline in the market price. The opposite of Long Position.
Short Squeeze: When prices of a stock, currency or commodity futures contracts start to move up sharply forcing shorters to cover.
Slippage: The difference between the expected price of a trade and the price at which the trade has been executed.
Spot Contract: An agreement to buy or sell an asset today.
Spot Market: A physical market in which foreign currencies and commodities are bought and sold for cash at the current market price, settled “on the spot” and delivered immediately.
Spot Price: The current market price.
Spread: The difference between the bid and offer prices.
Stagflation: Slow economic growth accompanied by a high rate of inflation.
Sterling: Slang for Great Britain Pound.
Stop loss: A stop-loss order ensures a particular position is automatically liquidated at a predetermined price in order to limit potential losses should the market move against a trader’s position.
STP: Straight Through Processing.
Strike price: The price at which an option contract can be exercised. In case of a call option, the option owner can purchase the underlying security or commodity, in case of a put option he can sell it.
Support: A technical analysis term that refers to a price level in a stock, currency or commodity where buying pressure is likely to exceed the selling pressure, forming a bottom or floor that blocks further downside movements in the instrument. The opposite is Resistance.
Swap: A currency swap is the simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate.
SWIFT: Society for Worldwide Interbank Financial Telecommunication.
Swissy: Slang for the Swiss Franc.
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T
Technical Analysis: The study of the price that reflects the supply and demand factors of a currency. Common methods are flags, trend-lines spikes, bottoms, tops, pennants, patterns and gaps.
Thin Market: A market characterized by low liquidity.
Tick: The minimum price movement of a security.
Trend: The direction of a price movement.
TRY: Turkish New Lira.
Turnover: The total money value of all executed transactions in a given time period.
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U
Underlying Asset: The underlying asset of a derivative is an asset, basket of assets, index or even another derivative, on which the price of the derivative depends.
Undervalued: A security that is trading below its perceived value. Opposite of Overvalued.
Unemployment rate: The percentage of the total labor force that is unemployed but actively seeking an occupation.
Uptick: A transaction occuring at a price above the price of the last transaction. In the United States, the uptick rule has been reintroduced in 2009 after the subprime crisis. The uptick rule refers to a trading restriction that disallowed short selling of securities except on an uptick.
USD: United States Dollar.
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V
Volatility: How much a price fl Germany’s Central bank, also called Buba. uctuates over a period of time.
VIX: A popular measure of the implied volatility of S&P 500 index options.
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W
World Bank: An international financial institution that provides loans to developing countries. One of the five institutions created at the Bretton Woods Conference in 1944.
World Trade Organization (WTO): An organization that intends to supervise and liberalize international trade. WTO replaced the General Agreement on Tariffs and Trade (GATT).
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Y
Yard: Slang for a billion.
Yield:The rate of return of an investment, expressed as a percentage.
Yield Curve: A curve that shows the relationship between yields and maturity dates of similar bonds at a given point in time

indicator,,,NonFarm Payroll……

NonFarm Payroll

This is a primary economic indicator followed by traders. Non-Farm Payroll (NFP) measures the change in the number of employed people during a month, excluding:
Government employees
Private household employees
Employees of non-profit organizations that provide assistance to individuals
Farming sector
A report is released monthly; usually in the first Friday of the month at 8.30am Eastern Time by the United States Department of Labor / Bureau of Labor Statistics.
Non-farm payroll is included in the monthly Economic Situation report (or Jobs Report) and affects not only Foreign exchange but also the bond market and the stock market. It is used by policy makers since job creation plays an important role in consumer spending.
The Economic Situation report also includes estimates on the average work week and the average weekly earnings of all non-farm workers.
To read the latest Economic Situation Report, please go to:
http://www.bls.gov/news.release/pdf/empsit.pdf

Carry trades,,,,,,,,,,,,,,,,,,,,

Carry trades

- Taking Advantage of Interest Rate Differentials
Carry trade consists on borrowing one currency that has a low interest rate in order to purchase another with a higher interest rate, taking advantage of the interest rate differential. This strategy can be highly profitable, especially if high leverage is used.
An example of Carry Trade is borrowing Japanese Yen (usually a low-yielding currency) to invest on Australian Dollars (a high-yielder)

Financial Instruments………….

Hi,friendz

today i will share about financial instrument in forex ….

Financial Instruments

According to IAS 32, a financial instrument is “a contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.”

A financial asset is any asset that is:
cash
an equity instrument of another entity
a contractual right:
to receive cash or another financial asset from another entity; or
to exchange financial assets or financial liabilities with another entity under conditions that are potentially favorable to the entity; or
a contract that will or may be settled in the entity’s own equity instruments and is:
a non-derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments
a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose the entity’s own equity instruments do not include instruments that are themselves contracts for the future receipt or delivery of the entity’s own equity instruments
puttable instruments classified as equity or certain liabilities arising on liquidation classified by IAS 32 as equity instruments
A financial liability is any liability that is:
a contractual obligation:
to deliver cash or another financial asset to another entity; or
to exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavorable to the entity; or
a contract that will or may be settled in the entity’s own equity instruments and is:
a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments or
a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose the entity’s own equity instruments do not include: instruments that are themselves contracts for the future receipt or delivery of the entity’s own equity instruments; puttable instruments classified as equity or certain liabilities arising on liquidation classified by IAS 32 as equity instruments
Financial instruments can also be categorized in two groups:
Cash instrument
Cash instruments are financial instruments whose value is determined directly by markets.
Derivative instruments
Derivative instruments are financial instruments which derive their value from the value and characteristics of one or more underlying entities such as an asset, index, or interest rate. They can be divided into exchange-traded derivatives and over-the-counter (OTC) derivatives.
Alternatively, financial instruments can be categorized by “asset class” depending on whether they are equity based (reflecting ownership of the issuing entity) or debt based (reflecting a loan the investor has made to the issuing entity). If it is debt, it can be further categorized into short term (less than one year) or long term.
The financial instruments/assets we will analyze are:

Currencies
Commodities
Gold
Silver
Platinum
Palladium
Indices
Futures
Options
Bonds
Stocks
Investment Funds
Exchanged Traded Funds (ETFs)
Exchanged Traded Commodities (ETCs

Thursday, September 20, 2012

Introduction to forex,,,,,part 2,,,

Euro Crosses

EUR/CHF - Euro/Swiss franc
EUR/JPY - Euro/Japanese yen
EUR/GBP - Euro/British pound
EUR/CAD - Euro/Canadian dollar
EUR/AUD - Euro/Australian dollar
EUR/NZD - Euro/New Zealand dollar

Currency Pairs

Currency pairs and currencies are often referred to by nicknames by traders rather than their symbolic nomenclature. These are some common examples:
Currencies

Currency Nickname

- Australian dollar (AUD) Aussie
- British pound (GBP) Cable / Sterling
- Canadian dollar (CAD) Loonie
- New Zealand dollar (NZD) Kiwi
- Swiss franc (CHF) Swissy
- U.S. dollar (USD) Buck / Greenback

Currency Pairs

Currency Nickname

GBP/USD (British Pound/US Dollar) Cable
EUR/USD (Euro/US Dollar) Euro or Fiber
USD/CHF (Swiss Franc/US Dollar) Swissy
USD/CAD (US Dollar/ Canadian Dollar) Loonie
AUD/USD (Australian Dollar/US Dollar) Ozzie
EUR/GBP (Euro/British Pound) Chunnel
USD/JPY (US Dollar/Japanese Yen) Yen

*Table taken from Wikipedia (latest data can be obtained from the Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity,
http://www.bis.org/publ/rpfxf10t.pdf)
Most traded currencies by value

Currency distribution of global foreign exchange market turnover[1]

Rank   Currency   ISO 4217      code   Symbol   daily share (%)
1   United States dollar         USD   $                       84.9%
2   Euro                        EUR   €                       39.1%
3   Japanese yen         JPY   ¥                       19.0%
4   Pound sterling         GBP   £                       12.9%
5   Australian dollar         AUD   $                       7.6%
6   Swiss franc         CHF   Fr                       6.4%
7   Canadian dollar         CAD   $                       5.3%
8   Hong Kong dollar         HKD   $                       2.4%
9   Swedish krona         SEK   kr                       2.2%
10   New Zealand dollar         NZD   $                       1.6%
11   South Korean won         KRW   ?                       1.5%
12   Singapore dollar         SGD   $                       1.4%
13   Norwegian krone         NOK   kr                       1.3%
14   Mexican peso         MXN   $                       1.3%
15   Indian rupee         INR   $                        0.9%
16   Other                                              12.2%
                                                         total    ............200%

The ISO Code of the most known currencies:

AUD - Australian dollar
BRL - Brazilian real
CAD - Canadian dollar
CHF - Swiss Franc
CNY - Chinese Yuan
DKK - Danish krone
EUR - Euro
GBP - British Pound
HKD - Hong Kong dollar
HUF - Hungarian forint
IDR - Indonesian rupiah
ILS - Israeli new sheqel
INR - Indian rupee
JPY - Japanese yen
MXN - Mexican peso
MYR - Malaysian ringgit
NOK - Norvegian krone
NZD - New Zealand dollar
PKR - Pakistani rupee
PLN - Polish zloty
RON - Romanian new leu
RUB - Russian rouble
SEK - Swedish krona
SGD - Singapore dollar
TRY - Turkish lira
USD - United States dollar
ZAR - South African rand

Introduction to forex......part 1,,

HI,friends to day i will share about forex who are beginner in forex they have to know about this,,,,,,,,,,,,,

Currency Pairs

Currencies are traded in pairs. A currency pair is the quotation of the relative value of a currency unit against the unit of another currency.
base currency: The first currency of a currency pair is called the base currency,
quote or counter currency: the second currency is called the quote, or counter, currency.
Currency pairs are written by concatenating the ISO currency codes (ISO 4217) of the base currency and the quote currency, separating them with a slash character.
Example: GBP/USD
GBP -> base currency
USD -> quote/counter currency
According to the average daily trading volume and to the liquidity we distinguish between: Majors,
Minors
and Exotic Pairs.
Major pairs
The most traded currency pairs in the world are called the Majors.
They involve Euro, US dollar, Japanese yen, Pound sterling, Australian dollar, Canadian dollar and the Swiss franc etc.
The Majors are:
EUR/USD - Euro/US dollar
USD/JPY - US dollar/Japanese Yen
GBP/USD - British Pound/US dollar
AUD/USD - Australian dollar/US dollar
USD/CHF - US dollar/Swiss franc
USD/CAD - US dollar/Canadian dollar
These currency pairs have high liquidity and represent more than 80% of the total Forex volume.
Minor Pairs
The Minor Currency Pairs ("Minors”) consist of those currencies traded less actively than the Majors, although their economies are still significant and they also tend to be active in international trade.
Exotic Pairs
The Exotic Pairs ("Exotics") are those pairs that are from emerging economies rather than from developed/industrialized nations. This includes:

USD/TRY - US dollar/Turkish lira
EUR/TRY - Euro/Turkish lira
USD/ZAR - US dollar/South African rand
EUR/ZAR - Euro/South African rand
USD/CNY - US dollar/Chinese Yuan
USD/INR - US dollar/Indian Rupee
USD/MXN - US dollar/Mexican peso
USD/SGD - US dollar/Singapore dollar
etc.

Currency pairs that are not paired versus the dollar are called "Currency crosses" or simply "Crosses". Pairs that involve the euro are often called "Euro Crosses".
Currency Crosses

GBP/CAD - British pound/Canadian dollar
GBP/CHF - British pound/Swiss franc
GBP/JPY - British pound/Japanese yen
GBP/NZD - British pound/New Zealand dollar
GBP/AUD - British pound/Australian dollar
CAD/JPY - Canadian dollar/Japanese yen
AUD/JPY - Australian dollar/Japanese yen
AUD/CAD - Australian dollar/Canadian dollar
AUD/NZD - Aussie dollar/New Zealand dollar
AUD/CHF - Australian dollar/Swiss franc
NZD/JPY - New Zealand dollar/Japanese yen
CHF/JPY - Swiss franc/Japanese yen

etc.

bye....

Pages

Sunday, September 23, 2012

History

Significance

Geography

Size

Benefits

Thursday, September 20, 2012