The greenback fell against the majors at the start of the week, tumbling just shy of the 1.29-level against the euro and dropping toward 1.5176 versus the sterling. The US equity market extended Friday’s gains with the Dow Jones up by over 3.6% and the Nasdaq advancing by more than 4% by afternoon trading amid a bailout plan to inject $20 billion into Citigroup and guarantee over $300 billion in toxic assets.

The housing market continues to struggle with existing home sales in October posting a 3.1% decline to 4.98 million units, down from 5.18 million units a month earlier. Several key reports are due out on Tuesday including Q3 preliminary GDP, Q3 PCE, September Case-Shiller home prices, November consumer confidence, and the Richmond Fed survey. The US economy is estimated to have contracted by 0.5% in Q3 while the Conference Board’s consumer confidence survey is estimated to slip to 37.9.


Euro Rallies, Shrugs off Dismal Data
Economic conditions in the Eurozone remain bleak with data from Germany revealing further deterioration. Germany’s October Ifo sentiment survey plunged by more than expected to its lowest level in nearly 16-years at 85.8 versus calls for a slide to 88.7 from 90.2 a month earlier. The expectations component tumbled to 77.6 from 81.4 while the current conditions index fell to 94.8 from 99.9 a month earlier. The drop in the Ifo sentiment survey was its sixth consecutive monthly decline and underscores the dour outlook for the Eurozone’s largest economy. Ifo President Sinn said, “The economic downturn has hardened and will now also affect the labor market”. With Germany’s economy already in recession, the latest data raises fears of a deep and prolonged recession and will likely prompt the ECB to ease rates aggressively at the coming meetings.

Pair: EUR/USD
Position: BUY
Entry Price: 1.3065
Target Price: 1.3155 (+95 PIPS)
Stop Loss: 1.2865 (-200 PIPS)
Remarks: To Be Posted Later

EUR/USD continued its upward trend for the past few days, especially during the last hours of trading for the day. It broke its 1.30 mark, and still going strong in an uptrend. And as I was saying yesterday, the EUR/USD will have a small correction, and it happened at around 100 pips more or less before it went straight up again.

My Forex Trading Journey Nov 13

Good day dear visitor, how's trading going on for you? I suffered some losses today. Market went the other way and my open positions we're hit by stop losses. But I managed to recover and recoup some of my losses and gain a little more, making my total profit to 10.76%

no. of trading days: 4
platform/broker: fxcm
initial capital: $5,000.00
pair: eur/usd
leverage: 1:400
trading system: pivot point/grid systems (with sma/ema, rsi) for short/medium/long term trends
money management: 1% and 0.5% total capital per trade
open trade/s: 1
open order/s: 0
equity: $5,543.82
floating p/l: -$6.00
ending balance: $5,537.82
gain percentage: 10.76%

What is a Spot Market?
A spot market is any market that deals in the current price of a financial instrument.

Which Currencies Are Traded?
The most popular currencies along with their symbols are shown below:

Symbol Country Currency
USD United States Dollar
EUR Euro members Euro
JPY Japan Yen
GBP Great Britain Pound
CHF Switzerland Franc
CAD Canada Dollar
AUD Australia Dollar
NZD New Zealand Dollar

Forex currency symbols are always three letters, where the first two letters identify the name of the country and the third letter identifies the name of that country’s currency.

When Can Currencies Be Traded?
The spot FX market is unique within the world markets. It’s like a Super Wal-Mart where the market is open 24-hours a day. At any time, somewhere around the world a financial center is open for business, and banks and other institutions exchange currencies every hour of the day and night with generally only minor gaps on the weekend.

The foreign exchange markets follow the sun around the world, so you can trade late at night (if you’re a vampire) or in the morning (if you’re an early bird). Keep in mind though, the early bird doesn’t necessarily get the worm in this market - you might get the worm but a bigger, nastier bird of prey can sneak up and eat you too…

Time Zone New York GMT

Tokyo Open 7:00 pm 0:00
Tokyo Close 4:00 am 9:00

London Open 3:00 am 8:00
London Close 12:00 pm 17:00

New York Open 8:00 am 13:00
New York Close 5:00 pm 22:00

The Forex market (OTC)
The Forex OTC market is by far the biggest and most popular financial market in the world, traded globally by a large number of individuals and organizations. In the OTC market, participants determine who they want to trade with depending on trading conditions, attractiveness of prices and reputation of the trading counterpart.

Why Trade Foreign Currencies?
There are many benefits and advantages to trading Forex. Here are just a few reasons why so many people are choosing this market:

* No commissions.
No clearing fees, no exchange fees, no government fees, no brokerage fees. Brokers are compensated for their services through something called the bid-ask spread.

* No middlemen.
Spot currency trading eliminates the middlemen, and allows you to trade directly with the market responsible for the pricing on a particular currency pair.

* No fixed lot size.
In the futures markets, lot or contract sizes are determined by the exchanges. A standard-size contract for silver futures is 5000 ounces. In spot Forex, you determine your own lot size. This allows traders to participate with accounts as small as $250 (although we explain later why a $250 account is a bad idea).

* Low transaction costs.
The retail transaction cost (the bid/ask spread) is typically less than 0.1 percent under normal market conditions. At larger dealers, the spread could be as low as .07 percent. Of course this depends on your leverage and all will be explained later.

* A 24-hour market.
There is no waiting for the opening bell - from Sunday evening to Friday afternoon EST, the Forex market never sleeps. This is awesome for those who want to trade on a part-time basis, because you can choose when you want to trade--morning, noon or night.

* No one can corner the market.
The foreign exchange market is so huge and has so many participants that no single entity (not even a central bank) can control the market price for an extended period of time.

* Leverage.
In Forex trading, a small margin deposit can control a much larger total contract value. Leverage gives the trader the ability to make nice profits, and at the same time keep risk capital to a minimum. For example, Forex brokers offer 200 to 1 leverage, which means that a $50 dollar margin deposit would enable a trader to buy or sell $10,000 worth of currencies. Similarly, with $500 dollars, one could trade with $100,000 dollars and so on. But leverage is a double-edged sword. Without proper risk management, this high degree of leverage can lead to large losses as well as gains.

* High Liquidity.
Because the Forex Market is so enormous, it is also extremely liquid. This means that under normal market conditions, with a click of a mouse you can instantaneously buy and sell at will. You are never "stuck" in a trade. You can even set your online trading platform to automatically close your position at your desired profit level (a limit order), and/or close a trade if a trade is going against you (a stop loss order).

* Free “Demo” Accounts, News, Charts, and Analysis.
Most online Forex brokers offer 'demo' accounts to practice trading, along with breaking Forex news and charting services. All free! These are very valuable resources for “poor” and SMART traders who would like to hone their trading skills with 'play' money before opening a live trading account and risking real money.

* “Mini” and “Micro” Trading:
You would think that getting started as a currency trader would cost a ton of money. The fact is, compared to trading stocks, options or futures, it doesn't. Online Forex brokers offer "mini" and “micro” trading accounts, some with a minimum account deposit of $300 or less. Now we're not saying you should open an account with the bare minimum but it does makes Forex much more accessible to the average (poorer) individual who doesn't have a lot of start-up trading capital.

What Tools Do I Need to Start Trading Forex?
A computer with a high-speed Internet connection and all the information on this site is all that is needed to begin trading currencies.

What Does It Cost to Trade Forex?
An online currency trading (a “micro account”) may be opened with a couple hundred bucks. Do not laugh – micro accounts and its bigger cousin, the mini account, are both good ways to get your feet wet without drowning. For a micro account, we'd recommend at least $1,000 to start. For a mini account, we’d recommend at least $10,000 to start.

To read more about forex, visit www.babypips.com