Best Times To Trade Currencies

Forex is a 24 hour market and there will be good setups for profitable trades in the Asian, European and US sessions. It pays to look at historical price data on forex charts to see what time of the day you could be watching the market and what time you could be doing something else. The aim is to trade when the average trading range is worthwhile and stay out of the market when price is in a narrow sideways range.

There are good online and downloadable tools at forex market hours

The market opens on Monday morning in Wellington New Zealand .8 am Wellington time is 8pm GMT,9pm BST,4pm EDT (Sunday evening New York time)

MARKET OPEN TIMES

(Summer Northern Hemisphere)

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The market closes for the week at 4pm EDT on Friday.

where BST is British Summer time ,EDT is Eastern Daylight Time USA.Check your local time at http://forex.timezoneconverter.com

The most active pairs during the London session are EURUSD with 39% of the trading volume, GBPUSD with 23%, USDJPY with 17%, USDCHF with 6% and USDCAD with 5%.

New York is the second largest forex market place. The busiest time is 8am to noon EST. News releases can result in a volatile market.

Sometimes volatility is low in the Tokyo session and sometimes good moves occur. The USDJPY is the most active pair with 78% of the volume followed by EURUSD with 15% and EURJPY with 5%.

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Practice Forex Trading

The selling was sparked in Asian trade overnight after reports yesterday that the Korean central bank plans to diversify its reserves away from the US dollar. A spokesman for the Bank of Korea was quoted as saying in a report to parliament that as foreign exchange reserves increase, the central bank "will expand its investment into non-government papers, which carry relatively high yields, and diversify the currencies in which it invests"

How to trust your forex setup?

For a successful start at forex, you have to trust and feel confident about yourself because you alone will be the cause of your success or failure in this business. No one has to go to college to know the ins and outs of trading. Everything needs practice including forex.
However, getting in this business with a lot of money and very little knowledge will lead you to a downfall, even if you try to recover in a few months after your first failure. On wrong move could be following a demo account. This type of “practice tool” can’t really be reliable especially for big players who use millions in trading.
The only reason for this is that you can only learn about the basics of forex trading. Unless you get a “hands-on” about forex and get on the “real” thing, then that is where you’ll learn more about trading.
On the other hand, the best benefit that you can get for forex demo accounts is that you can try them with small amount of real money and less fee to pay for education. You just have to have a lot of patience to take time to learn from setting your trade up and the more you repeat the process, the more you’ll learn from the trading business.
When going to real money account, be disciplined and follow rules you build when trading in demo account… Remember - greed and fear are natural, therefore think over every and any decision you did not plan before going into position.

http://forex-trading-on.net/2008/11/11/how-to-trust-your-forex-setup/

How does the interest rate trend affect the Forex market?

Last week the Forex market is affected by both U.S bonds auction and interest rate. Because the auction market is not vulgar, in addition with the decrease of the U.S bond rate, it will reduce the possibility of the increase of interest rate and loan, it will increase the value of the U.S dollar against other currencies. The Forex market will be affected by the retails sale, the manufacturing industry and the laborer data. According to the result announced by the Federal Reserve Department, the interest rate is to maintain unchanged which is expected by the market. Due to the close relationship of the interest rate and the Forex market, according to the INTEREST RATE PARITY (IRP), once the country increases the interest rate, its currency value will be increased. The reason is such, if the U.S deposit interest rate rises but the Japanese interest rate is invariable (but interest rate rise certainly does not affect stock market or any investment project repayment), the Forex traders know that the saving interest in U.S is much higher than the Japan saving interest, then the fund will be able to transfer from Japan pours into US, US dollar demand will increase but Japanese Yen demand will fall, therefore, US dollar will increase in value but the Japanese Yen will be relatively soft.

The increase of interest rate will often increase the currency value but the IRP limit is such, its assumes that investor will only focused on the bank deposit and the interest rate fluctuation will not affect other investment project repayments. Let's give an example, suppose that US FED increased its interest rate suddenly, according to will uncover the interest rate inevitably to follow the rise, this will increase the cost of investment for the investors to invest in the real estate, the investment demand will drop, the demand for U.S dollar and the Forex market will drop. Deduces, the enterprise financing interest rate rise, the company cost increases, the repayment drops, invests fund of and the exchange rate the U.S dollar will fall.

The Seven Most Traded Currencies in FOREX

Currencies are traded in dollar amounts called “lots”. One lot is equal to $1,000, which controls $100,000 in currency. This is what is known as the "margin". You can control $100,000 worth of currency for only 1,000 dollars. This is what is called “High Leverage”.

Here are some of the common symbols used in the Forex:
USD - The US Dollar EUR - The currency of the European Union "EURO" GBP - The British Pound JPN - The Japanese Yen CHF - The Swiss Franc AUD - The Australian Dollar CAD - The Canadian Dollar

Some of the common PAIRS are:
EUR/USD Euro / US Dollar "Euro"
USD/JPY US Dollar / Japanese Yen "Dollar Yen"
GBP/USD British Pound / US Dollar "Cable"
USD/CAD US Dollar / Canadian Dollar "Dollar Canada"
AUD/USD Australian Dollar/US Dollar "Aussie Dollar"
USD/CHF US Dollar / Swiss Franc "Swissy"
EUR/JPY Euro / Japanese Yen "Euro Yen"

Using the Bullish-Bearish Indicator to Spot a Potential Market Bottom or Top

There are several Psychological Market Indicators investors can use to help them determine when a Market Bottom or Top is nearing. One of the more important ones is the Bullish-Bearish Indicator which shows the % of Bullish and Bearish Investment Advisors. This data is available from Investors Intelligence and is also published by Investors Business Daily as well.
Generally when there is a large difference ( >30%) between the % of Bullish and Bearish Investment Advisors there is an excessive amount of Bullishness in the market which usually is indicative of a nearing top. The chart below compares the S&P 500 versus the % difference between the Bullish and Bearish Investment Advisors since 1998. As you can see when the % difference between the Bullish and Bearish Investment Advisors is >30% the S&P 500 has generally made a top and then reversed strongly to the downside. Some examples include last Summer (point A), the early part of 2001 (point B), the Spring of 2000 (point C), the early part of 2000 (point D), the Summer of 1999 (point E) and even further back in the Summer of 1998 (point F). Recently the % difference between the % of Bullish and Bearish Advisors reached near 30% again in January (point G) which was a warning sign that the S&P 500 was likely nearing a top after rallying strongly for three months.


http://www.forex-articles.net/article-74.html