Asia Session – February 25, 2010 1:49 AM
February 25, 2010
Risk aversion was once again the central theme today in Asia as cross yen pairs and risk currencies slid to the advantage of the US Dollar and Japanese Yen. The day was dominated by a few news stories that proved a detriment to risk here in Asia, including a story that the EU bailout of Greece is currently in jeopardy due to the Greek Deputy Prime Minister making verbal attacks at “Nazi” Germany. Besides claiming that the Nazis stole gold reserves from the Greek central Bank after the occupation, the Deputy Prime Minister also claimed that Italy has been actively “cooking its books” to deceive the EU. Not only did this alienate other EU nations from Greece, it was also the first nail in the risk appetite coffin in Asia. Full text »
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New York Session – February 24, 2010 6:12 PM
February 24, 2010
The NY session brought about a rollercoaster ride in the currency market, on the heels of what was a rather lackluster overnight session. Bernanke came out on the dovish side but was perhaps a little less forceful than the market had anticipated in terms of the outlook for the Fed target rate. It was actually more of the same as the Chairman basically said that the Fed target rate will remain low for an “extended period” of time. He also reaffirmed that the recent increase in the discount window rate was not a shift in policy. The bid tone to equities on Bernanke’s confirmation that the punchbowl will indeed remain in place initially helped EUR/USD stretch gains towards 1.3625/30. In the end, this would prove but another in a long list of short-squeezes as the pair promptly collapsed nearly -100 pips into a NY close by the 1.3535 zone. The rally in the equity space did help gold (XAU/USD) carve out an intraday bottom at 90 and the precious metal should now see better momentum buyers on a break above the 98 zone. This also kept the so-called commodity currencies supported despite what was an overall US dollar positive tone. Full text »
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Euro Heads Higher in Forex Trading
February 24, 2010
Currency trading with the euro
The euro is heading higher in forex trading on the currency market today, due mostly to U.S. dollar weakness.
With the Greeks on strike against austerity measures suggested by the Greek government and European Union policymakers as a way to bring the financial issues in Athens under control, it seems surprising that the euro would be doing well in forex trading. It should also weigh on the euro that gold prices are lower.
Really, though, a lot of the success has more to do with the surprise jump in the U.S. stock market, and the disappointment from dollar bulls about what Ben Bernanke has to say about U.S. economic fundamentals. Apparently, Bernanke isn’t ready to push forward with monetary policy tightening, and that is removing some of the recent support for the dollar in currency trading.
See Also
- Looking for Currency Trading Clues
Forex trading on the currency market
Bernanke Insists that the Economy is Not Ready to Sustain Itself
February 24, 2010
U.S. dollar falls in forex trading
Yesterday, the U.S. dollar was seeing a bit of a rally. At that point, it was all about risk aversion. Today, the story is a bit different. Right now, it’s all about U.S. economic fundamentals.
Federal Reserve Chair Ben Bernanke is testifying before Congress today and tomorrow, and today he said that the economy is not yet sustainable. So, even though there was a boost to the discount rate last week, the Fed isn’t ready to really tighten monetary policy yet.
As a result of these remarks, the U.S. dollar is lower in forex trading. Dollar bulls are disappointed that monetary tightening will not be happening anytime soon, and the euro has been waiting for a chance for a few days now.
It will be interesting to see how things go from here, and what Ben Bernanke has to say about economic progress in further testimony — and what he plans to do in order to exit from economic stimulus while limiting inflation.
See Also
- Economic News and the Currency Market
Forex trading news and information
Trading Psychology- Accepting the Risk
February 24, 2010
Trading psychology is the most important aspect of a trader’s success.
Trading Psychology- Accepting the Risk
Accepting the risk of each trade is not easy, especially for inexperienced traders. Of course, there are some steps we can take to make it easier to accept the risk. First, it is very important to plan out each trade. This means we should know where we will enter the trade, place our stop, and place our take profit level(s). That way there are no decisions that need to be made once the position is entered. The human brain will view information differently once that position is entered and it thinks much more clearly before the position is entered. Additionally, if we know the distance between the entry and the stop, we know exactly how much capital we are risking. This is important because it is impossible to accept a risk when we do not know how large the risk is. After entering the pre-planned trade, emotion is inevitable, but at least it won’t impact the result of the trade.
London Session – February 24, 2010 5:57 AM
February 24, 2010
Yesterday’s drop in the US consumer confidence indicator has significantly soured the mood in the market. Equity indices are down across the board and oil prices have given up some of their recent gains as the market faces the likelihood that the US recovery is still on shaky ground. The JPY surged in early London hours with EUR/JPY falling back to 121.60 before bouncing. USD/JPY remains below last night’s close near 90.10. Full text »
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Asia Session – February 24, 2010 1:36 AM
February 24, 2010
The name of the game to start Asia today was risk aversion, as a culmination of poor US consumer confidence, soft equity markets, dovish BoE comments and a downgrade of four Greek banks put a touch of fear back into the markets. The moves in Asia kept both the Dollar and Yen close to their highest New York levels despite a gradual sell off as the day progressed. Some of the buying in risk was attributed to a new 0 billion Japanese “toushin” which in essence is a mutual fund, this one being focused primarily on emerging markets. Full text »
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New York Session – February 23, 2010 5:44 PM
February 23, 2010
The flavor in NY trading was decidedly risk off. The US dollar continued to benefit from the flight to safety and poor economic data coupled with a very healthy 2-year Treasury auction helped to support the buck’s gains. US consumer confidence fell off the face of the earth in February to print a measly 46.0 after a 56.5 read the prior month. The market was looking for a solid 55.0 read, so the surprise was palpable indeed. The internals of the report were also ominous as both the expectations and current situation components declined – not good news for consumer spending going forward. If that wasn’t bad enough, the labor differential (jobs plentiful minus jobs hard to get) dipped to -44.1 from -42.1 and suggests that the improvement we saw in the US unemployment rate to 9.7% in January could have been a statistical anomaly. In other words, the potential for a grind back to a double-digit jobless rate should not be discounted. Full text »
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Traders from more than 14 countries compete for $50,000 in cash
February 23, 2010
GFT contest leader up more than 200 percent so far…Traders from more than 14 countries are competing in the GFT Trading Challenge, where the leader is up more than 200. Mean while, second and third place traders are battling close at 186 percent and 185 percent, respectively. Other competitors participating in the Challenge include Poland, Germany, Andorra (leader), Australia, France and the United Kingdom. The top 25 leaderbooard can be viewed here (the percentage ranges from 75 to 236 percent)
Yen Moves Higher in Forex Trading
February 23, 2010
Currency trading with the Japanese yen
The yen is moving higher in forex trading on the currency market today, gaining against all major currencies. Indeed, even though the U.S. dollar is making solid gains in currency trading, it is still falling to the yen.
With risk aversion the name of the game today, it is no surprise that the yen is gaining the upper hand in forex trading. Many carry trades are unwinding as risk appetite fades.
The yen is up against the pound and the euro in forex trading. The yen broke a little lower against the U.S. dollar earlier, but now the yen is even gaining against the greenback in currency trading.
See Also
- Currency Trading with the Yen
Forex trading on the currency market
