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Asian markets grew for the first time in last few days of trading which help by positive US reports. The US futures market continued to increase in the after-hours session, something that helped the Asian markets.

Even though the US GDP numbers came in much poorer than estimated, the financial market found the power to progress as consumer spending increased, while stockpiles decreased, which can make the perfect environment for the economy to improve later this year.

The combination of consumers rising their spending, where companies decrease their inventories may give the financial markets expect that the economy will rebound in the coming months, expert said. They also said that at this point, the market is in very positive form it overcame a report saying that 6 banks failed in the Treasury’s stress-test.

As such companies that have direct disclosure to the overseas markets placed important gains during the Asian session. Retail companies advanced also in the Asian equity markets, increased the gains from the US session.

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Despite the huge and quite unexpected drop of the U.S. gross domestic product in the first quarter of 2009 reported today, the stock markets rose globally, spurring euro and other high-yielding pairs in their gain against the greenback. The interest rates left unchanged weren’t a big news for the Forex traders. EUR/USD is now trading near 1.3264.

According to the advance report GDP decreased by 6.1% in the first quarter of 2009. It was down by 6.3% in the fourth quarter of 2008. Forecasts showed -4.9% for Q1 2009.

U.S. commercial crude oil inventories rose one more time last week — by 4.1 million barrels. They are still above the upper boundary of the average range for this time of year.

The Federal Reserve’s FOMC left interest rates unchanged at the range between 0% and 0.25%. They also left the amount of the U. S. Treasury securities that they will buy by autumn unchanged at $300 billion.

Posted on Forex blog.

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Every Forex trader finds himself literally drowned in all of the trading methods, systems and automated programs, day by day we are finding it hard the method that really works —at least for us. Any method out there, no matter how complicated, simple or “effective”, cannot guarantee you financial success unless YOU understand and learn to use it to your advantage. 

I have made another article regarding the method validation for whatever trading method you are using; here is another in relation to that.

Technical Indicators. Any good trading method out there will avoid too many or wrong technical indicators. Any trader with too many forex indicators will find themselves confused and will have conflict in their profit potential. The key here is simplicity. The more simple indicators are to understand, the more it is effective.

If you want to find a good trading method, few forex indicators together can identify whether you have a strong trade opportunity or not. I have discovered 3 to 4 indicators working together to accomplish this. An easy trading method may mean simple; and simple is the key of being effective. Forex traders should be cautious if using more than 4 forex indicators.

Another, any good method should not be purely mechanical. By mechanical, I mean there will be no room for market interpretation. Any good method will allow a forex trader to see the larger picture. E.G. is a forex pair in an extended downtrend? If so, is now the time to buy an uptrend? A mechanical system will tell you “buy” but a forex trader who succombs to this will not see the bigger picture or have his own interpretation and istead just follow the signals and may face a disappointing consequence.

A good method makes a good trader. The method you should be using should help you establish discipline. This means the actions of trading — buying, selling, setting stops, and the like. If you have to face too many decisions, you are more likely to end afraid, and may not profit because you did not make a trade. Fear brings you to nothing. A method you use should be easy to follow, because the way to remove fear is understanding.

The trading method that can make you rich should use simple indicators to identify a trending forex pair, and such a way provide a lower risk and higher profit potential. Any fx master’s method is more simple than you think, because it is easy to understand, apply therefore easier to lower risk and pull in the profits.

With these keys, I hope you are enlightened on what trading method you should follow. This information here and the other information in the articles I wrote should help you be saved from the headache and the heartbreak of a Forex loss.
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US Futures post significant decline tonight, although Asian markets are trading in the green. The main cause of concern seems to be the swine flu that just hit the US borders.

It seems that the swine flu is the problem to hit the US and the global financial system. For now, the investors are anxious that the cost of combating the new disease will only add another streak on the government’s budget, already influenced by the huge rescues that financial sector requisite. Also, like this time, consumers tend to spend less, which will also affect the business cycle rising significantly the recovery period. Experts said.

However, Asian equity markets seem unaffected up to now, reaching the maximum valuation in the last three months of trading. The financial sector constant to progress tonight, helped by the unofficial, preliminary stress test outcomes, which show that most banks have a sufficient capital base. Equally with the financial sector, pharmaceutical companies also placed some major gains tonight, as drug sales are possibly to raise up.

Additionally, the Japanese government decreased yet again the GDP projections for 2009, down to 3.3%, something that should have pulled the Asian markets worse.

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The new indicator that I’ve created recently (based on the idea of one of my site’s visitors) can help every Forex trader that uses MetaTrader platform. It can notify traders when the currency pair rate (or price) reaches a certain level, goes above some level or goes below some level. It uses the sound and visual alerts and also displays the preset price levels on the chart. This indicator can be used with any currency pair or any other trading instrument. I wonder why something similar wasn’t made as a standard feature for MetaTrader 4. Of course, you can freely download Price Alert indicator and read more about it:

• Price Alert MT4 Indicator

By the way, if you have any good ideas for the MT4 indicators you can reply to this post, describing it, and I will try to implement it.

Posted on Forex blog.

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Group of 24 nations said on Friday the global financial and economic crisis is hurting to developing countries, which will have to deal with the fallout long after advanced economies.

The G24, made up of developing countries from Latin America, Asia and Africa said quick turn down in increasing and falling currency reserves were leading to growing unemployment and poverty levels.

The risks of a more protracted worsening in the world economy remain significant a G24 communique said after a meeting on the sideline of the spring meeting of the World Bank and International Monetary Fund.

The communique noted the crisis had originated in advanced economies and was affecting developing economies through sharp falls in remittance, exports, private capital flows and a global credit crisis.

The group said that developing countries will require unprecedented and urgent support from global financial institutions like the World Bank and IMF.

The G24 also supported an early review of the role of the IMF in the international monetary system, including the role of major currencies like the Euro, Yen, Dollar and British Pound.

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EUR/USD trend: sell.
GBP/USD trend: hold.
USD/JPY trend: sell.
EUR/JPY trend: sell.

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There are many aspects forex traders observe in order to pick the most profitable currency pair. Forex market has endless possibilities and no restrictions on which currency to choose and how many currency pairs to trade. The question is what are the most preferred currency pairs? How to choose the right currency pair? Is sticking to one-pair path beneficial or it is more profitable to multitask?  

In order to pick up the currency pair that suits you most, you have to consider the following aspects of forex trading:

1. SPREAD. Tight spreads ensure to keep your costs down. With smaller spreads you can have more profits due to larger gaps during price volatility and you can also reach your break even point quicker. Most forex brokers offer EUR/USD currency pair with the tightest spread of 2-3 pips.
2. TREND. It is important to analyze the trend of the selected currency pair in forex market. Forex charts with indicators can ease the process of choosing the most profitable currency pair. Most currency pairs are simply more trendy than the rest.
3. TRADING SESSIONS. The most profitable time to trade forex is when the market has a lot of trading transactions. Depending on the currency pair, you will have to adopt to the right trading time.  

For example:

¨       7 PM EST to 10 PM EST – Tokie Stock Exchange opens

¨       8 AM EST to 12 PM EST – NY Stock Exchange and London Stock Exchange open simultaneously (this is the time to trade almost any currency pairs)

Every trader differs with diverse mindset, psychological self-control, trading approach and overall understanding of forex market. Whether you choose to trade one pair or several is entirely up to you. Do not try to imitate other traders you know – your trading style must be picked and chosen by you. Your decision has to be based on what, how and when you wish to trade.  

All of us understand that one market is closely correlated to another market. Once you have an experience and understanding of one currency, it seems logical to take advantage of this and trade several pairs. However, most successful traders are fully focused on just one pair (usually EUR/USD). Mastering one-pair forex trading allows you to understand the distinct “personality” of a selected pair and get confident with it. Despite the fact that one-pair traders could most probably use their knowledge to trade any other currency pair, they choose to stick with one. 

The main reason for forex traders to focus on one currency pair is that multiple currency pairs requires much more work. Not all traders are able to handle all the information and correlation between currency pairs. Instead of concentrating on one pair, in most cases you spread the attention wide and end up with a headache, lower quality of trades and analysis, and greater risk of under performance because of neglect and loss of both attentive and passive observation of the forex market. 

Obviously with one currency pair you might face fewer opportunities; however it doesn’t mean you will be less profitable. Many traders choose to become an expert in just one area rather than being an average in several. 

Including other currency pairs to your trading plan may lead to extra pressures you are not always ready for and you might be exposed to less familiar trading style. Generally it isn’t easy to even follow one pair and fully understand all the WHYs involved in real time trading.  

I personally tried to watch out for 3 pairs simultaneously and end up being less successful. I was missing out on a lot of information and therefore my personal trading style is just one pair. I am aware of the correlations with other pairs, but right now I only care about one graph. So for me, focusing on just one pair makes me more focused, precise and successful. 

That being said, it should be emphasized once again that every trader has a different style. There is no right or wrong way to trade. In may ways trading style of one trader may appear too difficult and even unnecessary to other. All forex trading ways are unique, special and should be personalized according to your agenda.

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EUR/USD gained slightly during today’s trading session despite the predominantly pro-crisis and anti-euro fundamental news that were released in U.S. and Eurozone both today and yesterday. The currency pair is now trading near 1.3020 after closing at 1.3002 yesterday.

Initial jobless claims were at 640k in United States last week — an increase of 27k compared to the previous week’s 613k (revised upwardly from 610k). The forecast value was almost the same as the actual reading — 639k.

Existing home sales in U.S. fell in March — from 4.71 million to 4.57 million after rising in February. The market analysts expected a decline to 4.65 million units.

Yesterday, the weekly crude oil inventories report showed an increase by 3.9 million barrels. The  U. S. total commercial oil inventories are now at 370.6 million barrels.

Posted on Forex blog.

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A worker recently fired from his job by US financial services. The company disappointed that the firm had followed to be sure he did not remove violently at his ex- bosses or co-workers.

‘Tough times will cause people to do crazy things’, said Kenneth Springer, who is company Corporate Resolutions Inc. did the surveillance. “People are taking more precautions”.

Job uncertainty, Job losses and slashed budgets are all straining that could push somebody over the edge.

An expert says workplace violence can range from intimidation to violence and harassment and homicides.

While economic pressure can make some people violent, it would not turn just anybody into killer, said Laurence Miller.

Statistics on workplace violence in this financial crisis will take years to collect and examine an expert says. From 1997 to 2007, the most recent year for which data is available, there above 7,000 professional homicides countrywide, according to the US Bureau of Labor statistics.

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