EUR/JPY: Ready for a Top?

One of the strategies in my High Probability Trading eBook is called the Extension Fade. The strategy looks to fade a move after a currency pair has rallied or fallen for a certain number of consecutive days.
According to the eSignal chart below, EUR/JPY is now on its EIGHTH consecutive day of strength. [...]

Chinks in the Euro's Armor

2008 has witnessed a rapid appreciation in the Euro, which recently breached the psychologically important $1.60 barrier. Last week, however, the Dollar dramatically reversed course, leading many traders to speculate that the Euro's best days may be temporarily behind it....

Could 1 Euro Equal 2 US Dollars?

The fourth time is the charm for the Euro as it finally pierces the 1.60 level against the US dollar. Despite slightly better than expected existing home sales in the US, a rebound in house prices, and news that the German Banking Association bailed out Duesseldorfer Hypothekenbank AG after a string of mortgage losses, [...]

AUD Nears Parity

The word "parity" is becoming a mainstay of traders in the forex markets. In 2007, it applied to the Canadian Dollar, which had rallied 70% over the course of five years to reach the mythical 1:1 level against the USD....

In the Financial Papers: Today’s Top Forex News 04.22.08

Here is the “In the Financial Papers Radio Broadcast” (Length: 5:46 minutes). The player should load automatically. Please let me know if you like it. Contact Kathy
In the Financial Papers:
















 
Podcast Covers:
Bank of Canada Cuts Interest Rates by 50bp, Signals More to Come
Bank of England Offers to Acquire Mortgage Securities
Calls for LIBOR Rate Shake-up Grows
German Banking [...]

BOC Cuts Rates

The Bank of Canada has cut its benchmark lending rate by 50 basis points, to 3.0%. The move was widely expected by analysts, although some of them had forecast only a .25% cut. Last week, economic data confirmed a mild...

Are Central Banks Out of Their Minds?

More central banks around the world are using public money to bail out private companies. Are central banks out of their minds? Are they running out of options?
Back in March, the Federal Reserve announced that would be lending banks as much as $200 billion in US Treasuries in exchange for [...]

Vietnam Dong to Slide Further

In the year-to-date, the Vietnamese Dong has fallen by .7%. That may not seem like much, but since the Dong/Dollar exchange rate is approximately 16,000 to 1, every .1% is meaningful. Unfortunately for Vietnam, analysts are predicting that the Dong...

In the Financial Papers: Today’s Top Forex News 04.21.08

Here is the “In the Financial Papers Radio Broadcast” (Length: 6:49 minutes). The player should load automatically. Please let me know if you like it. Contact Kathy
In the Financial Papers:
















 
Podcast Covers:
Bank of America Reports 77% Profit Loss and Sells Part of Stake in Chinese Bank
Smaller Banks Begin to Pay Price for Boomtime Expansion
National City Gets [...]

The Strong Dollar Myth

When asked to discuss the official position of the USA with regard to its currency, Treasury Secretary Henry Paulson typically invokes the "Strong Dollar Policy." According to former Treasury Secretary Paul O'Neill, however, this policy is a "vacuous notion." Mr....

News Trading Calendar 04.20.08 - 04.25.08

1) Our Weekly Trading Calls for News Events have 70% Accuracy
2) Get 2-3 Trade Recommendations Next Week that Aim for 70-100 pips
Don’t Miss Out on Any of the Excitement! Become a Member. Get More Details.
The Full Event Risk Calendar that is categorized into 3 Trading Tiers is for [...]

FXCM Introduces ETF Alternative

Forex Capital Markets (FXCM) recently unveiled a product that represents a viable alternative to currency exchange trade funds. A currency ETF is "index-passive" because it is linked to an index and rises and falls in line with the value of...

April Layoffs Continue to Build

The markets love the Google numbers today and stocks are up strongly. But lets not forget that the layoff tally has been building on a near daily basis. These are only a few of the big layoff announcements this past month. JPMorgan has yet to announce layoffs at Bear Stearns (which currently [...]

G7 Warns of Volatility

For the last few months, EU politicians have whined about the appreciating Euro. Aside from some token comments by the European Central Bank, however, the world failed to pay heed. That changed last week, when the G7 formally and harshly...

Dollar Hits New Record Low, Which is Good for Earnings

The dollar’s impact on US corporate earnings continue! Last night, IBM blew away Wall Street when it reported that its 2008 profit will top its previous projections. Interestingly enough more than half of their 11 percent revenue was due to currency fluctuations!

The dollar matters.
The companies that will do the best this [...]

Yen Carry Trade Under Siege

Volatility levels on JPY/AUD forward contracts recently jumped to 25%, the highest level since the Asian financial crisis of 1997-1998. Combined with other factors, this suggests that the JPY/AUD carry trade, whereby investors borrow in low-yield Yen in order to...

Counting Down to Euro 1.60

Week after week I have called for the EUR/USD to break 1.60. Today, the currency pair hit an all time high and is inching ever so closer to that target. It will just be a matter of time before that level is broken at which time intervention risk will increase substantially. Hot [...]

USD May be Nearing Bottom

The USD continues to dominate conversation in forex circles, as investors ponder whether the currency will fall further or whether it has already sunk as low as it can go. One commentator recently encapsulated the debate into six factors, three...

The Impact of Food Prices Beyond the Developed World

I am a big believer that the next big shock to the global economy is not the weakness of the US economy, but skyrocketing food prices.
My good friend Shirley is a relief worker for Trocaire out of Mozambique, Africa and through her, poverty and hunger is an issue particularly dear to my heart.
When [...]

Economists: Euro Correction Inevitable

In a research note, two economists from Morgan Stanley predicted that the Euro will soon come crashing down, failing in its bid to rival the Dollar as a viable reserve currency. They observed that in the beginning of the decade,...

Johnson and Johnson’s Earnings is Proof of Why the US Government Really Wants a Weaker Dollar

Strong Earnings from Johnson and Johnson is one today’s biggest stories. Although sales have increased in all 3 of its units (medical devices, consumer products and pharmaceuticals), if not for the weakness of the US dollar, drug sales would have actually declined.
Revenues increased 7.7 percent in the first quarter with currency moves contributing 5.1 [...]

The Future of FX

For a recent article, EuroMoney Magazine pulled together some of the top currency analysts on Wall Street for a comprehensive discussion on the state of forex. The conversation zigs and zags, covering such varied topics as volatility, interest rates, trading...

Why Consumers May Need to Get Use to $110+ Oil

Oil prices are ripping higher this morning. 24 hours after the US retail sales report told us that gasoline receipts is the ONLY reason why the value of consumer spending increased last month, today’s rise in oil leads us to wonder how much more pain can the average consumer bear?
McCain’s Proposal = 2 Big [...]

RMB at Record Low

The lack of fanfare not withstanding, the Chinese Yuan, or RMB, continues to appreciate against the USD. This week, it crossed the psychologically important barrier of 7 RMB/Dollar, a level last seen in the 1990's. Since its revaluation nearly three...

Fox Business 04.14.08 - 04.18.08

I’m a Feature Guest on Fox Business’ Opening Bell this week. As a result my postings will be reduced to one a day. There will also be no In the Financial Papers (sorry!) since I have to leave for their studios at 7:30am and I’m not back in the office until 10:30am. [...]

ECB Holds Rates

The European Central Bank (ECB) has decided to hold its benchmark interest rate at 4%. Despite signs that the EU economy is slowing, inflation is hovering around 3.5%, and the ECB has announced that its priority will be to maintain...

In the Financial Papers: Today’s Top Forex News 04.11.08

**I will be a Featured Guest Fox Business’ Opening Bell 4/14-4/18 (9am-10am ET), so there will be no In the Financial Papers next week!
Here is the “In the Financial Papers Radio Broadcast” (Length: 7:15 minutes). The player should load automatically. Please let me know if you like it. Contact Kathy
In the Financial Papers:
















 
Podcast Covers:
Dollar Sells [...]

Retail Appeal of Forex Grows

With average daily turnover of $3 Trillion, the foreign exchange markets are the largest financial markets in the world. Despite boasting such impressive volume and liquidity characteristics, forex is nonetheless considered extremely risky, and thus viewed as the bastion of...

What Does it Mean When Trichet Uses Price Stability 7 Instead of 8 Times?

In his Godfather like tone, ECB President Trichet told the markets that “the sentiment of the Governing Council is the same as last time, so if there is any interpretation that it goes in another direction, it is a wrong interpretation.”
=
Trichet is one of the few central bankers whose words are as [...]

Central Bank of Japan Appoints Leader

For several months, the Central Bank of Japan had been leaderless, creating a situation that was politically and economically awkward. Finally, after much debate, Masaaki Shirakawa, a former academic and veteran central banker, was appointed. It is unclear what effect...

Why G7 Meetings Matter

There is no time better than the present to recognize the dollar’s weakness. With the April 11 G7 meeting of Finance Ministers and Central Bankers just days away, government officials around the world have the power to stop the dollar from falling. But will they? Over the past 30 years, G7 meetings [...]

USD: Where is it Headed?

The last week has seen a spate of positive developments in the financial markets, including reassurances by several bulge bracket investment banks that their respective capital positions are in strong and in no need of shoring up. As a result,...

What Drove the US Dollar to a Record Low

Those who may have hoped for a recovery in the US dollar have been sorely disappointed. The greenback hit a record low against the Euro and it will just be a matter of time before the EUR/USD hits 1.60. Before you know it, we’ll be talking about the possibility of one Euro [...]

Forex Leads Equities

In recent months, the credit crunch has ignited a global trend towards risk aversion. As a result, a correlation has developed between equities, which serve as a proxy for risk, and certain currencies. The Forex Blog previously covered the link...

In the Financial Papers: Today’s Top Forex News 04.10.08

Here is the “In the Financial Papers Radio Broadcast” (Length: 5:15 minutes). The player should load automatically. Please let me know if you like it. Contact Kathy
In the Financial Papers:
















 
Podcast Covers:
ECB Leaves Interest Rates at 6 Year Highs
BoE Cuts Interest Rates by 25bp to 5.00%
US Dollar Hits Record Low
Dollar Breaches 7 Chinese Yuan
Inflation, Inflation, Inflation

USD: Worst Quarter in 4 Years

In the first three months of 2008, the USD notched its worst quarterly performance since 2004, falling over 8%. During the same period, the Dollar lost 10% of its value against the Japanese Yen and 6.4% against a broad basket...

Have Foreclosures Hit an Extreme?

As traders we know that when Main Street latches onto something, it usually means the top. Growing foreclosures have been one of the biggest concerns of Wall Street and with real estate brokerages now giving Foreclosure Bus Tours, it leads us to wonder whether foreclosures have hit a peak.

According to the following ARM schedule [...]

Barclays Introduces Carry Trade ETN

Through its trademark iPATH line of funds, Barclays Bank recently introduced a new ETN designed to mimic the carry trade. In accordance with this strategy, this note is linked to the performance of the Barclays Intelligent Carry Index, which aims...

Increasing the Accuracy of News Trading for FX Traders

On Wall Street Knowledge I$ Money
In the Currency Market Making Money Means Profiting From The News Of The Day
…But Where Can The Retail Trader Find The Edge To Make The Right Decision?
Every Week, Kathy Lien and Boris Schlossberg Publish Their Proprietary Event Risk Calendar Making Calls on Key Market Moving Economic Data of the Day [...]

Fundamentals Harm Emerging Market Currencies

Since the inception of the credit crunch, one of the themes in forex markets has been the surprising strength of the Dollar. Despite growing economic uncertainty, the US is still viewed as a relatively safe place to invest. On the...

British Pound: UK Housing Market Problems Worsen

** I miss everyone’s emails and comments. If you agree with me or even if you don’t, feel free to drop me an email or better yet, comment on the posts!
Last week, I indicate that the British pound could break 2.0 if disaster hits UK mortgage lenders. The currency is now trading below [...]

In the Financial Papers: Today’s Top Forex News 04.01.08

Here is the “In the Financial Papers Radio Broadcast” (Length: 06:39 minutes). The player should load automatically. Please let me know if you like it. Contact Kathy
In the Financial Papers:
















 
Podcast Covers:
UBS Faces Large Writedown, CEO Steps Down
Americans Delay Retirement as Housing Stocks Swoon
RBA Leaves Rates Unchanged, Dovish Comments
Japanese Tankan Much Weaker than Expected 4 years
German [...]

Japan (Also) Mulls Intervention

Yesterday, the Forex Blog reported that the risk of intervention in forex markets is growing, in order to prop up an ailing Dollar. The focus of the post was on the Euro, which is hovering below the record high of...

How Bad are US Stocks Doing?

US stocks have fallen over 7 percent since the beginning of the year. For US traders, investors and anyone with a 401k, this certainly feels like a bear market.
However, the performance of US stocks isn’t nearly as bad as the performance of equities in many other countries around the world. According [...]

The Rising Threat of Intervention

Last week, the Euro retreated from the record high of $1.60 that it achieved earlier in the week. Policymakers are still concerned, however, and are perhaps using this lull to come up with a plan of action should the Dollar...

Choosing Forex Software The Easy Way

Choosing forex software for your specific needs can be a minefield. There are so many different types and most of them do different things or different combinations of things. It becomes a little difficult to keep up with it all!

But there is no need to panic. Choosing forex software need only be as difficult as you make it and in fact can be a pretty easy decision with a little key information. Here are a few tips to help you on your decision.

Define Your Purpose.

Knowing exactly what you want to do is the key to choosing the correct software. Have one goal in mind for your purchase and you can’t really go wrong. But what should that be?

Well, most people are going to want their software to perform a specific task.

The most common tasks that are important to a foreign exchange trader are charting, forecasting and trading. Ok, that might be a little simplified, but these are the logical tasks that can be aided by having some good quality software help in the process.

Luckily these tasks are the most common that forex software provides help with.

Forex charting software will take the historical data that you provide it with to then display charts which you can use in your trading decision making process. Many foreign exchange traders rely on charts to make trading decisions and most of those charts are made with charting software. Getting some solid charting software can save you a lot of time and heart-ache and help with your trading decisions.

Trading software usually just keeps track of your trades on the market. It basically gives you a historical view of how you are doing. Again, it is only as good as the data you feed it so make sure your data is accurate. Some trading software will even help in the process of the trade by communicating with certain forex services online.

Forecasting software also uses historical data to help predict foreign exchange trends so that you can make better decisions with regard to your trades. There is some overlap with Charting Software in this category as charting software could also be partially regarded as forecasting software. This type of software is a big gun in the arsenal of a lot of the top forex traders so it is a good idea to get the best rather than the cheapest software in this category.

With these forex software types in mind, it is important that you define exactly what you want from your own software purchase and make your decision accordingly.

Some foreign exchange software will take care of all of the tasks above whereas other software will only be built for one specific purpose.

Knowing your own forex needs is the key.