Update Daily Technical Levels from FXCC

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Daily Technical Levels from FXCC 12 Sep 2011


[color=#FF0000]EUR/USD[/color]
[color=#006400]Intraday Technical Levels:[/color]
Pivot: 1.3650.
Preference: SHORT positions @ 1.364 with 1.341 & 1.338 as next targets.
Alternative Scenario: The upside breakout of 1.365 will open the way to 1.372 & 1.3785.
Comment: the RSI is capped by a declining trend line, the pair stands below its new resistance and remains
under pressure.

[color=#FF0000]USD/JPY [/color]
[color=#006400]Intraday Technical Levels:[/color]
Pivot: 77.45.
Preference: SHORT positions @ 77.35 with 76.7 & 76.4 as next targets.
Alternative Scenario: The upside penetration of 77.45 will call for a rebound towards 77.65 & 77.9.
Comment: the pair has broken below an ascending channel support.

[color=#FF0000]GBP/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]
Pivot: 1.5900.
Preference: SHORT positions @ 1.589 with 1.581 & 1.575 in sight.
Alternative Scenario: The upside penetration of 1.59 will call for a rebound towards 1.597 & 1.6.
Comment: the pair remains capped by a key declining trend line and in an intraday bearish channel.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Daily Technical Levels from FXCC – 13 Sep 2011


[color=#FF0000]EUR/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]
Pivot: 1.3555.
Preference: LONG positions @ 1.3565 with 1.3785 & 1.388 in sight.
Alternative Scenario: The downside penetration of 1.3555 will call for 1.3495 & 1.341.
Comment: the RSI broke above a declining trend line.

[color=#FF0000]USD/JPY [/color]
[color=#006400]Intraday Technical Levels:[/color]
Pivot: 77.40.
Preference: SHORT positions @ 77.3 with 76.75 & 76.55 as next targets.
Alternative Scenario: The upside breakout of 77.4 will open the way to 77.65 & 77.85.
Comment: the upward potential is likely to be limited by the resistance at 77.4.

[color=#FF0000]GBP/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.5785.
Preference: LONG positions @ 1.5795 with 1.589 & 1.5925 as next targets.
Alternative Scenario: The downside penetration of 1.5785 will call for a slide towards 1.5695 & 1.566.
Comment: the pair remains capped by a key declining trend line but has broken above an intraday bearish channel resistance.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Update - Daily Technical Levels from FXCC 13 Sep 2011

[color=#FF0000]EUR/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.3555
Preference: Long positions above 1.3555 with targets @ 1.3785 & 1.388 in extension.
Alternative Scenario: Below 1.3555 look for further downside with 1.3495 & 1.341 as targets.
Comment: the RSI is mixed with a bullish bias.

[color=#FF0000]USD/JPY [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 77.4
Preference: Short positions below 77.4 with targets @ 76.75 & 76.55 in extension.
Alternative Scenario: Above 77.4 look for further upside with 77.65 & 77.85 as targets.
Comment: the break below 77.4 is a negative signal that has opened a path to 76.75.

[color=#FF0000]GBP/USD[/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.575
Preference: Long positions above 1.575 with targets @ 1.587 & 1.589 in extension.
Alternative Scenario: Below 1.575 look for further downside with 1.5695 & 1.5660 as targets.
Comment: the RSI calls for a rebound.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Disambiguation – Aka Forex Scalping


Scalping is the act of removing another person’s scalp or a portion of their scalp, either from a dead body or from a living person. The initial purpose of scalping was to provide a trophy of battle, or portable proof of a combatant’s prowess in war. Eventually, the act became motivated primarily for financial reasons; people received payment per scalp they acquired.

Scalping is often associated with frontier warfare in North America, and was practiced by Native Americans, colonists, and frontiersmen across centuries of violent conflict. Some Mexican (Sonora and Chihuahua) and American territories (Arizona) paid bounties for enemy Native American scalps. Contrary to popular belief, scalping was far from universal amongst Native Americans. Scalping was practiced by the ancient Scythians of Eurasia. Herodotus, the Greek historian, wrote of the Scythians in 440 BC;

“The Scythian soldier scrapes the scalp clean of flesh and softening it by rubbing between their hands, uses it thenceforth as a napkin. The Scyth is proud of these scalps and hangs them from his bridle rein; the greater the number of such napkins that a man can show, the more highly is he esteemed among them. Many make themselves cloaks by sewing a quantity of these scalps together.” – credit Wikipedia.

If you’re of a certain age you’ll recall the cowboy western propaganda films of the 50′s-60′s in which the indigenous population of a nation were portrayed as violent non compliant insurgents armed with little except crude weapons to fight their colonial oppressors. Imperialists arrived using technology the indigenous population (Indies or Indians) had never seen before. The invading forces then claimed the Indians mineral rich land as their own by force whilst attempting ideological conversion on the Indies. It’s a blessed relief that in circa 200 years of civilised growth we’ve moved further on as a global society to not engage in such practices. Oh..er, moving on..

Similar to the erroneous myth that scalping originated in North America and not ancient Eurasia, the term “scalping” is one of the most over used and misused terms heard in the retail forex industry. Ask different sets of traders what “scalping” is and they’ll offer up a variety of theories. The origins of the term relate to the trader attempting to take a small pip profit including (or only aiming for) the ‘spread’. As such you’d require the best technological set up and a lightening quick feed to the exchange and preferably not wireless. You’d also require level 2 access/see the DOM, the depth of the market. You’d be able to see the orders, the difference between the bid and ask, and bam! you’re in, seconds later you’re out, profit banked.

Due to the advent of online trading the term “scalping” has recently ‘evolved’ to encompass trading off low time frames, typically one to five minutes, or tick charts. This version of scalping results in traders taking any number of trades during their two predominant sessions, morning and afternoon, London and New York. Taking between ten to a hundred trades plus on a single currency pair, depending on how the ‘surf is up’ in the forex market that day, is not unusual depending on the preferred technique… Read the full article
http://blog.fxcc.com/disambiguation-aka-forex-scalping

Source: FX Central Clearing Ltd. (FXCC BLOG)

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[color=#4682B4]Daily Technical Levels from FXCC 14 Sep 2011[/color]


[color=#FF0000]EUR/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.3730.
Preference: SHORT positions @ 1.372 with 1.3555 & 1.3495 in sight.
Alternative Scenario: The upside penetration of 1.373 will call for 1.379 & 1.388.
Comment: the RSI lacks upward momentum. A resumption of the short-term bearish trend is expected.

[color=#FF0000]USD/JPY [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 77.10.
Preference: SHORT positions @ 77 with targets @ 76.75 & 76.55.
Alternative Scenario: The upside breakout of 77.1 will open the way to 77.4 & 77.65.
Comment: the RSI lacks upward momentum.

[color=#FF0000]GBP/USD[/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.5820.
Preference: SHORT positions @ 1.581 with targets @ 1.5695 & 1.566.
Alternative Scenario: The upside breakout of 1.582 will open the way to 1.587 & 1.589.
Comment: the pair remains in an intraday bearish and the RSI is capped by a declining trend line.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Update Daily Technical Levels from FXCC 14 Sep 2011

[color=#FF0000]EUR/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.367
Preference: Long positions above 1.367 with targets @ 1.379 & 1.388 in extension.
Alternative Scenario: Below 1.367 look for further downside with 1.359 & 1.3555 as targets.
Comment: the break above 1.367 is a positive signal that has opened a path to 1.379.

[color=#FF0000]USD/JPY[/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 77.1
Preference: Short positions below 77.1 with targets @ 76.75 & 76.55 in extension.
Alternative Scenario: Above 77.1 look for further upside with 77.4 & 77.65 as targets.
Comment: a key declining trend line maintains downward pressure.

[color=#FF0000]GBP/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.576
Preference: Long positions above 1.576 with targets @ 1.587 & 1.589 in extension.
Alternative Scenario: Below 1.576 look for further downside with 1.5705 & 1.566 as targets.
Comment: the RSI has just broken above a bearish trend line.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Daily Technical Levels from FXCC 15 Sep 2011


[color=#FF0000]EUR/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.3625.
Preference: LONG positions @ 1.3635 with 1.379 & 1.384 as next targets.
Alternative Scenario: The downside breakout of 1.3625 will open the way to 1.3555 & 1.3495.
Comment: the pair has broken above a declining trend line and is now trading in a slightly ascending channel.

[color=#FF0000]USD/JPY [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 77.00.
Preference: SHORT positions @ 76.9 with 76.55 & 76.4 in sight.
Alternative Scenario: The upside penetration of 77 will call for 77.25 & 77.4.
Comment: the RSI lacks upward momentum.

[color=#FF0000]GBP/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.5815.
Preference: SHORT positions @ 1.5805 with targets @ 1.5705 & 1.566.
Alternative Scenario: The upside penetration of 1.5815 will call for 1.587 & 1.589.
Comment: the pair remains in an intraday bearish channel and the RSI lacks upside momentum.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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[color=#FF0000]Happy Lehman day! Have the masters of the universe lost their kryptonite, or just their marbles?[/color]

On October 5th 2010 there was an audible gasp in the French courtroom at the historic Palais de Justice when the ‘rogue trader’ Jérôme Kerviel was convicted of a breach of trust, computer abuse and forgery. The 33-year-old was convicted of all three charges and was sentenced to five years’ imprisonment, with two years suspended.

It was not the ‘severity’ of the sentence that drew the gasps and sharp intake of breath, it was the damages, set at €4.9bl to Société Générale, this was the total sum of money his risky betting strategies cost his former employers in January 2008. The Brittany-born computer expert was described as a quiet cynical operator who exploited his technological knowhow and market understanding to fool his employers. Exposing the bank to uncovered trades worth €50bn, more than Société Générale’s total share capital at the time.

“The varied nature of his means of forgery and deceit were rivalled only by the dazzling reactivity, the constant cool-headedness and the deceptive serenity which he was able to exhibit on an everyday basis,” said the judge. On reflection it may have been more appropriate if the gasps had been replaced with laughter, whilst massive the symbolic damages award was preposterous, if the idea was to send out a message then to who and how? The lenient sentence alone would not serve as a deterrent.

Irrespective of his actions the bank was later part of an ECB bank bail out, despite which its share capital currently stands at only €14 billion. It could be argued that the ‘criminals’ who have lost circa €38 billion of their bank’s value this year are simply the usual suspect mixture of incompetents and blusterers of the banking fraternity and we’ve now come to accept this tight brotherhood will always escape punishment. However, small investors, pension fund managers and retirees might not be so accepting, they would no doubt put the current management of SocGen first in the queue for an appointment with Madame Guillotine ahead of Jérôme Kerviel.

Many commentators could be forgiven for treating with suspicion the allegations that have emerged this morning suggesting that another rogue trader has apparently run amok ultimately causing an unauthorised loss of circa $2 billion. As a result of this unspecified loss UBS, Switzerland’s biggest bank, may now be unprofitable in the third quarter. This is the bank that had to raise circa $45 billion from investors after the investment bank division recorded 57.1 billion Swiss francs ($65 billion) in cumulative pretax losses in three years through 2009. There will be inevitable calls for the investment arm of the bank to now shrink dramatically or close.

The sad irony and co-incidence is that this alleged fraud and loss has come on the third anniversary of Lehman bros filing for bankruptcy, this will no doubt raise doubts as to how comprehensive the supposed regulatory and self compliant improvements put in place since the banking collapse in 2008-2009 actually are. Whilst the Jérôme Kerviel ‘incident’ could be ‘excused’, given it occurred at the height of the banking crisis, this latest event has happened after back office regulations and compliance were now supposedly water tight.

This incident will actually have many in the mainstream media sharpening their pens to point out that no lessons have been learned since 2008 and to ask the question, “if this can happen after 2008 then how many other major investment banks have ‘sleeper cell’ rogue traders stalking their dealing rooms and floors?” To imagine that this latest ‘miscreant’ is the only rogue amongst the hundreds of thousands employed in the industry, is stretching belief to tensile breaking point.
http://blog.fxcc.com/happy-lehman-da...-their-marbles

Source: FX Central Clearing Ltd. (FXCC BLOG)

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Update Daily Technical Levels from FXCC 15 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.37
Preference: Long positions above 1.37 with targets @ 1.384 & 1.388 in extension.
Alternative Scenario: Below 1.37 look for further downside with 1.365 & 1.3625 as targets.
Comment: the RSI is supported by a rising trend line.

USD/JPY Intraday Technical Levels:

Pivot: 76.8
Preference: Short positions below 76.8 with targets @ 76.4 & 75.95 in extension.
Alternative Scenario: Above 76.8 look for further upside with 77.1 & 77.25 as targets.
Comment: a key declining trend line maintains downward pressure.

GBP/USD Intraday Technical Levels:
Pivot: 1.578
Preference: Long positions above 1.578 with targets @ 1.584 & 1.5870 in extension.
Alternative Scenario: Below 1.578 look for further downside with 1.5735 & 1.5705 as targets.
Comment: the break above 1.578 is a positive signal that has opened a path to 1.584.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Daily Technical Levels from FXCC 16 Sep 2011


[color=#FF0000]EUR/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.3940.
Preference: SHORT positions @ 1.393 with 1.3765 & 1.3705 as next targets.
Alternative Scenario: The upside penetration of 1.394 will call for 1.3975 & 1.4015.
Comment: the 1.395 former support area is now acting as a resistance. The pair is capped by a declining trend line.

[color=#FF0000]USD/JPY [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 76.60.
Preference: LONG positions @ 76.7 with targets @ 77.05 & 77.25.
Alternative Scenario: The downside penetration of 76.6 will call for 76.4 & 76.3.
Comment: the RSI is supported by a rising trend line & the pair has broken above a declining trend line.

[color=#FF0000]GBP/USD [/color]
[color=#006400]Intraday Technical Levels:[/color]

Pivot: 1.5870.
Preference: SHORT positions @ 1.586 with 1.5735 & 1.5705 as next targets
Alternative Scenario: The upside penetration of 1.587 will call for 1.5915 & 1.595.
Comment: the pair is capped by a declining trend line.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Delta one, this is control tower two calling, please respond…Over

One of the first and most crucial instructions novice pilots are given in how to communicate with the aircraft control tower is to keep communication brief, clear and relevant. “Think about what you are going to say before saying it. Mentally go over exactly what you will say before touching the radio and keep it in mind.” At Delta one desk in UBS, the currency trader Kweku Adoboli’s Facebook profile had a brief, clear and relevant plea to his friends: “Need a miracle.” Having become trapped, due to the instantaneous depreciation of the Swiss franc after the SNB’s ‘peg’ decision, he was now in a big hole and knew he had no escape ladder or tunnel. A sobering thought for any traders who profited from the sharp fall in the CHF franc last week; there can often be someone else on the other side of the trade, literary banking on the franc’s continual appreciation being a one way bet.

On Delta one desk Adoboli handled proprietary dealing clients trades, trading in a variety of securities assisting clients to speculate and hedge baskets of securities. If clients wished to short Swiss equities, (expecting the franc to rise), the desk would design a trade and use a combination of; equity swaps, futures and ETFs to hopefully achieve it. Derivatives should (in theory) mirror the securities they track, in effect insure against market moves and as such shouldn’t carry any extra risk for the bank.

This episode serves to remind us just what a tightrope the line between success and failure is at the highest trading levels. With all the quants, algorithms, theories, the finest technology and minds at your disposal our industry still comes down to the phrase credited to the brilliant and infamous trader Jesse Livermore; “you never know ’till you bet!”

There’ll be many amongst us who feel empathy with the trader, some of us may have wiped out our own trading accounts, (hopefully small accounts whilst learning our craft), and whilst the phrase “it’s all relative” hardly compares to wiping out €2billion we’ll recognise the feelings of pain, humiliation and hopelessness. Kweku Adoboli’s father is reported to be heartbroken after the news broke, his words bring home the human element of the loss, and before we all rush to condemn perhaps there is a simple explanation that UBS would rather not be broadcast, his huge losing trade was their losing trade, and the blame and accusation of systemic failure is ultimately theirs and not singularly his.

In an interview with Reuters, John Adoboli, a retired United Nations employee from Ghana, said he knew the financial sector was a high risk area, but he had no doubts about his son’s competence and integrity…. Read the full Story
http://blog.fxcc.com/delta-one-this-...e-respond-over

Source: FX Central Clearing Ltd. (FXCC BLOG)

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Update - Daily Technical Levels from FXCC – 16 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.384
Preference: Short positions below 1.384 with targets @ 1.3765 & 1.3705 in extension.
Alternative Scenario: Above 1.384 look for further upside with 1.3895 & 1.394 as targets.
Comment: the RSI broke below a bullish trend line.

USD/JPY Intraday Technical Levels:

Pivot: 76.6
Preference: Long positions above 76.6 with targets @ 77.05 & 77.25 in extension.
Alternative Scenario: Below 76.6 look for further downside with 76.4 & 76.3 as targets.
Comment: a support base at 76.6 has formed and has allowed for a temporary stabilisation.

GBP/USD Intraday Technical Levels:
Pivot: 1.5825
Preference: Short positions below 1.5825 with targets @ 1.5745 & 1.5705 in extension.
Alternative Scenario: Above 1.5825 look for further upside with 1.587 & 1.589 as targets.
Comment: the upward potential is likely to be limited by the resistance at 1.5825.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Daily Technical Levels from FXCC – 19 Sep 2011


EUR/USD
Intraday Technical Levels:

Pivot: 1.3775.
Preference: SHORT positions @ 1.3765 with 1.359& 1.3555 as next targets.
Alternative Scenario:The upside penetration of 1.3775will call for 1.3835 & 1.3895.
Comment:the pair has broken below its support andremains under pressure.

USD/JPY
Intraday Technical Levels:

Pivot: 76.75.
Preference: LONG positions above 76.75 with targets@ 77.05 & 77.25.
Alternative Scenario: The downside breakout of 76.75will open the way to 76.6 & 76.4.
Comment: the RSI is supported by a rising trend line,the pair is on the upside and is approaching its resistance.

GBP/USD
Intraday Technical Levels:

Pivot: 1.5770.
Preference: SHORT positions @ 1.576 with targets@ 1.565 & 1.557.
Alternative Scenario: The upside penetration of 1.577will call for a rebound towards 1.5825 & 1.587.
Comment: the pair stands within a MT bearish channeland is challenging its previous low.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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Is Forex Trading a Form of Gambling?

here’s been a subtle change on the high streets of the UK over recent years. Where previously betting shops were mysterious smoke filled denizens where the errant uncle, father or grandfather wasted a proportion of his wages each week, (in between visits to the local pub), they’re now clean, open inviting places offering a massive range of products.

Similar to the drinks industry, who realised over the past decade they could reach down and get the kids hooked as early as possible with the invention of sugary tasting alcopops, the betting industry has not been slow to adapt in their hunger to ensnare the next generation. Not only are the betting shops unrecognisable, now offering a laid back, leisurely, ambient environment in which to lose your money with ease across a vast array of sports markets, the major firms have also migrated to mobile devices, you can now throw away your fivers and tenners with ease across: iPod, Android or Blackberry devices, and similar to financial markets bet when the markets are in play.

Think Fernando Torres will get a penalty in the match versus Chelsea, after scoring one great goal and then missing the open goal of the season and that he’ll fluff the penalty, then begin to pull his bleached hair out, roll around the penalty area, sucking his thumb whilst crying like a baby screaming, “take me back to Athletico Madrid”? Then there’ll be a bookie that’ll gladly take your money off you in record time.

Those last two paragraphs read as rather arrogant, flippant and dismissive of a massive industry, any apologies will not be forthcoming as it’s quite deliberate. No doubt certain readers will point out the irony that forex trading is still gambling and suggest the methods used by brokers are not too dissimilar to that used by bookies and in some ways they’d be correct. However, there are subtle differences and one massive difference, the massive difference is that your ECN broker wants you to win, his success can only be perpetuated due to your continued success. There is no broker involved in sports betting, there’s a ‘bookie’ and he wants you to lose. They want you hooked, then they want your money, as much of it as possible. They make no efforts to increase your performance and profitability and only increase their supply of apps based technology in order to take your money off you, using smarter quicker methods, through your smartphone.

There may be a few horse race ‘form’ algorithms and certain on line bookies offer systems, the most sophisticated betting algorithms available are still ‘Martingale’ systems; keep on doubling up the bet until you get the winner, then quit and go back to your original level of risk. This system is taken to the extreme at dog tracks where the suggestion is that you stick to a trap number. Not quite Fibonacci retracement or Ichimoku cloud indicators which you can plot on a free charting package, all provided by a broker who wants you to be successful. There’s no seminars from the bookie, no video support, no blogs, strategies, techniques, or support articles, it really is a one way relationship based on the provision of addiction.

The advantages of forex betting or markets betting over traditional sports betting could form a long list, here’s just a few critical differences;

We only bet on two horse races; price either goes up or goes down.

We can stop our race; we simply exit the trade early and as a consequence we immediately reduce our risk.

We can change our jockeys and horses at any time during the race; if you think the other side of your pair trade is the better direction then you can take it at any stage of the race.

We can alter our bet in the race; if we’ve got direction right we can increase our position size. If we’ve got direction wrong we can hedge.
http://blog.fxcc.com/is-forex-tradin...rm-of-gambling

Source: FX Central Clearing Ltd. (FXCC BLOG

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Update - Daily Technical Levels from FXCC – 19 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.3715
Preference: Short positions below 1.3715 with targets @ 1.359 & 1.3555 in extension.
Alternative Scenario: Above 1.3715 look for further upside with 1.3775 & 1.3835 as targets.
Comment: the RSI is capped by a declining trend line, the pair has struck against its new resistance and remains on the downside.

USD/JPY Intraday Technical Levels:

Pivot: 76.9
Preference: Short positions below 76.9 with targets @ 76.6 & 76.4 in extension.
Alternative Scenario: Above 76.9 look for further upside with 77.05 & 77.25 as targets.
Comment: the pair has broken below a bearish flag lower boundary and should face further weakness.

GBP/USD Intraday Technical Levels:

Pivot: 1.577
Preference: Short positions below 1.577 with targets @ 1.5685 & 1.565 in extension.
Alternative Scenario: Above 1.577 look for further upside with 1.5825 & 1.587 as targets.
Comment: the pair stands below its new resistance and remains within a MT bearish channel.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

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The Misnomer of Over Trading and How It Differs from Impulsive Trading.

Overtrading – the excessive buying and selling of securities by an investor in order to increase the probability of successful trades. Can the phenomena of over-trading be explained away by the singular use of a one line description, does this one sentence fully cater for all the nuances and complexity involved?

It’s suggested by many trading experts that over trading can kill accounts just as quickly as either a lack of capitalisation, or lack of expertise and experience. Whilst undeniably a logical conclusion does this claim actually stand up to scrutiny? After all swing traders could immediately condemn the phenomena of day trading in all its forms and in particular scalping as over trading, without even delving into the technique used they’d presume the trader was over trading. But one man’s meat is another’s poison and over trading may be as misunderstood a concept as other myths that have been allowed to evolve unchallenged in the industry..

“I’m trading four pairs; the euro, cable, euro-yen and the Aussie off fifteen minute time frames. I’m taking up to fifty trades per day and my win/lose ratio is as bad as 7:1 some days, what d’ya think the correct or average amount of legitimate set ups I should be getting each day, am I over trading?”

This is a version of a question often posted on trading forums or on the “ask the expert” sections of broker websites. On first inspection the impulse is to suggest that yes, taking that amount of trades on that amount of pairs is over trading. However, a huge chasm exists between what could be considered over trading and impulsive trading, in fact the concept of over trading may not exist, or if it does it may have become a victim of trader mistranslation.
Let’s look at our example trader and analyse his technique further.. Read the full article
http://blog.fxcc.com/the-misnomer-of...ulsive-trading

Source: FX Central Clearing Ltd. (FXCC BLOG)

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Update - Daily Technical Levels from FXCC – 20 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.365
Preference: Long positions above 1.365 with targets @ 1.375 & 1.3835 in extension.
Alternative Scenario: Below 1.365 look for further downside with 1.3595 & 1.3555 as targets.
Comment: the RSI is well directed, the contract is on the upside and is breaking above its resistance.

USD/JPY Intraday Technical Levels:

Pivot: 76.75
Preference: Short positions below 76.75 with targets @ 76.4 & 76.3 in extension.
Alternative Scenario: Above 76.75 look for further upside with 77.05 & 77.25 as targets.
Comment: the pair stands below its resistance and remains under pressure.

GBP/USD Intraday Technical Levels:
Pivot: 1.574
Preference: Short positions below 1.574 with targets @ 1.5675 & 1.563 in extension.
Alternative Scenario: Above 1.574 look for further upside with 1.5770 & 1.5825 as targets.
Comment: the pair is posting a rebound and is challenging its MT bearish channel upper boundary, the RSI calls for caution.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Daily Technical Levels from FXCC – 21Sep 2011


EUR/USD Intraday Technical Levels:

Pivot: 1.3750.
Preference: SHORT positions @ 1.374 with 1.365 &1.3595 as next targets.
Alternative Scenario:The upside penetration of 1.375will call for a rebound towards 1.3835 & 1.39.
Comment:the pair stands below its strong resistance(50% Fibonacci retracement of the previous downmove) and should face a weakness.

USD/JPY Intraday Technical Levels:

Pivot: 76.55.
Preference: SHORT positions @ 76.5 with targets@ 76.1 & 76.
Alternative Scenario: The upside penetration of 76.55will call for a rebound towards 76.75 & 77.
Comment: the RSI is capped by a declining trend line,the pair is under pressure.

GBP/USD Intraday Technical Levels:

Pivot: 1.5770.
Preference: SHORT positions @ 1.576 with 1.5675& 1.563 in sight.
Alternative Scenario: The upside breakout of 1.577will open the way to 1.5825 & 1.5865.
Comment: the pair has struck against its resistance andshould face a down move as the RSI is turning down.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Market Commentary 21 September


Falling on your sword is just so last century

“He’s not the messiah, he’s a very naughty boy.. – Monty Python, Life Of Brian.”

There was a time when politicians made an effort to set the moral agenda. However, given the refusal of leading politicians (in all countries) to accept any responsibility for their actions it comes as no surprise when the CEOs of major companies display the same levels of arrogance and defiance when confronted with their failure…

The harshest punishment Oswald Gruebel, chief executive officer of UBS, may face is pressure to cut the levels of risk and shrink the investment bank when the board meets in Singapore today, less than a week after a $2.3 billion loss (and ‘conveniently’ rising) from unauthorised trading.

The CEO apparently received a “scolding” yesterday from the Government of Singapore Investment Corp., the company’s biggest investor, who expressed “disappointment and concern about the lapses” and urged UBS to “take firm action to restore confidence in the bank,” according to a statement from the sovereign wealth fund after its senior management met with Gruebel yesterday.

Gruebel, was anointed with the responsibility to rebuild Zurich-based UBS after the huge bank suffered record losses on their U.S. sub-prime mortgage securities which in turn led to a state rescue. “Saint Ossie” helped to restore Credit Suisse Group AG’s profits as a consequence of the rescue and bailout.

Christian Hamann, an analyst at Hamburger Sparkasse;

“This is a black eye for Gruebel and the bank. On the other hand, he’s done a few things quite well and successfully stabilised the bank, which may have earned him some credit that he hasn’t used up yet.”

Eurobonds are being ‘pushed’ once again by the European Commission President Jose Barroso; “the commission believes we should look also at that option. We are not saying it is immediate. This is a matter that must be discussed, but we should not exclude that option either.”

The Eurobond initiative would be sold jointly by the euro area’s seventeen nations, it remains an option due to the fact that the bailouts by governments and the European Central Bank failed to alleviate solvency concerns. Barroso said in an interview with Bloomberg that the commission, (the European Union’s executive branch), will present euro-bond options very soon.

The reality of Greek Prime Minister George Papandreou’s brain-wave is beginning to hit the general populous, the new property tax, summarily dumped on the electricity bill from this month onwards, is causing anguish and despair in equal measures, could it be the straw that finally breaks the Spartans’ backs? Greek subway, tram, train, bus and trolley workers will hold a 24-hour strike in Athens tomorrow in opposition to their government’s plans to cull the public sector, according to spokespeople at the Greek Transit Workers Union.

As an example of modern day politicians not accepting responsibility for their collective actions G.Pap is Emmy award winning. However, in his and his country’s current predicament he’s snookered. If Greece wants the next tranche of bailout funds, in order to pay civil servants and to take care of the mundane office jobs, such as filling the ATMs with freshly printed Euros, then his government has to prove compliance with the previous bailout and an ability, based on incredible austerity cuts, to meet further loan obligations whilst continuing to pay loan shark rates for a few billion here and there off the ‘markets’.

As the two day Fed policy meeting comes to an end today many commentators and analysts are predicting something BIG to be announced at the culmination of the meeting. Presumably this announcement can only be positive news and indices will no doubt react accordingly.

The Federal Reserve appears likely to try to push long-term borrowing costs lower by re-balancing its $2.8 trillion portfolio of bond holdings to weight it more heavily to longer-term securities. Fed officials believe that by shifting bond holdings this will encourage mortgage refinancing and push investors into riskier assets, such as corporate bonds and stocks, without flaming consumer price inflation.

Asian markets were mixed in over-night/early morning trade, the CSI responding well to further bullish Chinese export and growth data closing up 3.02%. China is one of the few countries to be targeted for growth by the IMF. The Nikkei closed up 0.23% principally due to disappointing export figures. Japan’s exports rose in the year to August but at less than half the pace expected as the global economic slowdown, a strong currency and Europe’s sovereign debt crisis put Japan’s recovery in doubt. Weak exports are also an ominous sign as the Federal Reserve prepares for more QE, which will inevitably push the yen even higher versus the dollar directly worsening trade conditions for major Japanese exporters and employers. The Hang Seng index closed down 1% perhaps indicating that growth expectation is mainly focused on mainland China.

European bourses are mainly down in morning trade, the DAX leading the falls currently down 1.15%. The CAC is down 0.94%, the ftse is down 0.45%. the STOXX is currently down 0.74%. Cable has suffered a sharp drop and spike in morning trade as a consequence of the MPC minutes revealing that further QE is now a consideration. Sterling has fallen sharply versus Yen the Euro and the Swissy. The Euro has made significant gains versus CHF, as has the USA dollar. Gold is up $7 an ounce and Brent crude is up $21 a barrel. The SPX daily future is currently predicting a positive open up circa 0.5%.

The data publications of interest this afternoon include;

12:00 US – MBA Mortgage Applications
15:00 US – Existing Home Sales Aug
19:15 US – FOMC Policy Announcement Sept 21.

The FOMC announcement expected at 19:15 undoubtedly takes centre stage given the persistent rumours of a revised QE programme to be launched. We can expect different language, avoiding the use of “QE” to describe the fresh infusion and ‘asset’ purchase, however, the result will be the same. How long this latest twist in the Fed’s sobriety will last is the $14,737,251,228,137.12 question ( the live USA debt clock figure at 10.47am gmt).

http://blog.fxcc.com

[alayoua]

Update - Daily Technical Levels from FXCC – 21 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.3725
Preference: Short positions below 1.3725 with targets @ 1.3595 & 1.3555 in extension.
Alternative Scenario: Above 1.3725 look for further upside with 1.378 & 1.3835 as targets.
Comment: the RSI has broken below a rising trend line, the pair remains under pressure and is challenging its support.

USD/JPY Intraday Technical Levels:

Pivot: 76.55
Preference: Short positions below 76.55 with targets @ 76.1 & 76 in extension.
Alternative Scenario: Above 76.55 look for further upside with 76.75 & 77 as targets.
Comment: the RSI remains capped by a declining trend line, the pair stands below its resistance.

GBP/USD Intraday Technical Levels:

Pivot: 1.57
Preference: Short positions below 1.57 with targets @ 1.561 & 1.557 in extension.
Alternative Scenario: Above 1.57 look for further upside with 1.576 & 1.5825 as targets.
Comment: the pair has struck against its resistance and remains on the downside.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Daily Technical Levels from FXCC – 22Sep 2011


EUR/USD Intraday Technical Levels:

Pivot: 1.3610.
Preference: SHORT positions @ 1.36 with targets@ 1.3495 & 1.345.
Alternative Scenario:The upside penetration of 1.361will call for 1.37 & 1.38.
Comment:the pair remains on the downside and isapproaching its previous low.

USD/JPY Intraday Technical Levels:

Pivot: 77.00.
Preference: SHORT positions @ 76.95 with 76.5 &76.25 in sight.
Alternative Scenario: The upside penetration of 77 willcall for 77.25 & 77.4.
Comment: the pair has struck against its strong resistanceand should face a weakness.

GBP/USD Intraday Technical Levels:

Pivot: 1.5520.
Preference: SHORT positions @ 1.551 with 1.5425& 1.537 as next targets.
Alternative Scenario: The upside penetration of 1.552will call for a rebound towards 1.5575 & 1.5635.
Comment: the pair stands below its new resistance(former support) and remains on the downside.


Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Searching for +1, Perfect Correlation in Forex Trading

“Wow, has anyone else noticed that when the EUR/USD goes up the USD/CHF goes down?” is a ‘Eureka’ announcement often made by new traders when they first stumble upon basic correlation. In some respects it’s a good sign, it displays awareness.

However, as many forex traders will testify if it’s that easy we’d simply wait for one currency to spike and immediately take that perfect -1 negative correlation trade. It’d work for a while, then some funky algorithm at Blackrock would no doubt ‘front run’ the play taking out all our fun whilst hoovering up all the pips.

Surprisingly correlation is one of the least discussed topics on forums dedicated to forex trading and yet a thorough understanding of its mechanics and relevance should form part of any forex traders toolbox.

Correlation is a measure of the relation between two or more variables. The measurement scales used should be at least interval scales, but other correlation coefficients are available to handle other types of data. Correlation coefficients can range from -1.00 to +1.00. The value of -1.00 represents a perfect negative correlation while a value of +1.00 represents a perfect positive correlation. A value of 0.00 represents a lack of correlation.

Because currencies are priced in pairs, no single pair trades completely independent of the others. Once you are aware of these correlations and how they change, you can use them control your trading portfolio’s exposure.

The interdependence of currency pairs is straightforward to understand, here’s an example; if you trade Sterling versus yen (GBP/JPY) you are actually trading a derivative of the GBP/USD and USD/JPY pairs; therefore, GBP/JPY must be somewhat correlated to one if not both of these other currency pairs. The interdependence of currencies stems from more than the fact they are traded in pairs. Some currency pairs move in tandem, other currency pairs move in opposite directions, which is often the result of more complex forces.

Correlations change, which makes shadowing the changes in correlations important. Sentiment and global economic factors are increasingly dynamic and often change on a daily basis. Strong correlations today might not be in line with the longer-term correlation between two currency pairs. It’s therefore essential to consider the six-month trailing correlation. This provides a more focused perspective on the average six-month relationship between the two currency pairs, which tends to be more accurate. Correlations change for a variety of reasons; diverging monetary policies, a currency pair’s sensitivity to commodity prices, unique economic and political factors. Viewing correlation tables from minutes to weeks is also advisable for a comprehensive viewpoint and understanding.

How can we use correlations to manage our trading exposure, how can we use them to our advantage?

The most obvious answer is correlations can help us to avoid entering two positions that in effect cancel each other out. Knowing that EUR/USD and USD/CHF move in opposite directions nearly 100% of time (the -1 correlation) having trading positions of long EUR/USD and long USD/CHF is in some respects the same as having no position. A correlation table will illustrate that when the EUR/USD rallies, the USD/CHF will experience a sell-off.

Conversely, being long EUR/USD and long AUD/USD or NZD/USD is similar to doubling up on the same position given that the correlations are so strong. However, there may be valid reasons to hold trades of similarly correlated pairs, diversification being one.
http://blog.fxcc.com/searching-for-1...-forex-trading

Source: FX Central Clearing Ltd. (FXCC BLOG)

[alayoua]

Update - Daily Technical Levels from FXCC – 22 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.3575
Preference: Short positions below 1.3575 with targets @ 1.341 & 1.332 in extension.
Alternative Scenario: Above 1.3575 look for further upside with 1.37 & 1.38 as targets.
Comment: the pair stands below its resistance and remains under pressure.

USD/JPY Intraday Technical Levels:

Pivot: 76.7
Preference: Short positions below 76.7 with targets @ 76.25 & 76.1 in extension.
Alternative Scenario: Above 76.7 look for further upside with 77 & 77.25 as targets.
Comment: the pair is under pressure and is challenging its support.

GBP/USD Intraday Technical Levels:

Pivot: 1.552
Preference: Short positions below 1.552 with targets @ 1.537 & 1.5285 in extension.
Alternative Scenario: Above 1.552 look for further upside with 1.5575 & 1.5635 as targets.
Comment: the pair is breaking below its support and remains on the downside.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Daily Technical Levels from FXCC – 23Sep 2011


EUR/USD Intraday Technical Levels:

Pivot: 1.3575.
Preference: SHORT positions @ 1.3565 with targets@ 1.345 & 1.3385.
Alternative Scenario:The upside penetration of 1.3575will call for 1.363 & 1.37.
Comment:the pair stands below its resistance andremains under pressure.

USD/JPY Intraday Technical Levels:

Pivot: 76.55.
Preference: SHORT positions @ 76.5 with targets@ 76.1 & 75.95.
Alternative Scenario: The upside breakout of 76.55will open the way to 76.7 & 77.
Comment: the pair remains under pressure and is approachingits support

GBP/USD Intraday Technical Levels:

Pivot: 1.5450.
Preference: SHORT positions @ 1.544 with 1.5325& 1.5285 in sight.
Alternative Scenario: The upside breakout of 1.545will open the way to 1.552 & 1.5575.
Comment: the RSI is capped by a declining trend line,the pair stands below its resistance.


Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Making Sure You Muse on Forex News

How economic literate are you? Some twenty years back as a bit of pre work ‘fun’, I set a small team of salesmen I was managing a pre work test. As with all our Wednesday sessions there was a prize at stake which always ensured a competitive edge to the quiz. The test had ten questions on the key economic issues of the day. One question that sticks in my mind was “what is the current interest rate?” At the time the rate was an eye watering 13-14% and despite most of us having mortgages only one or two of the eight knew the Bank of England’s base rate. It got worse, the result was that the ‘winner’ took the prize with four correct answers and the questions were not too taxing. Now what surprised me at the time was that both myself and my colleagues were selling multi unit office equipment deals, often with a large ‘ticket’ value, into the City of London. I’d expected (incorrectly) that all of us would be what I’d term “commercially aware”.

As a student of economics I’ve never lost my hunger for financial news, but I didn’t set the test at a high level, it was very basic. When walking into some of the major global financial institutions I believed that you had to have a brief understating of how they ‘worked’ even if only to strike up casual conversation away from the deal you’re there to (hopefully) take care of. For example, if selling equipment into a major bank today you should be able to comfortably hold your own in a discussion on where you believe the economy is headed.

As a consequence of my profession I have to be commercially aware, not just as a specialist forex trader, but also to offer FXCC a range of blog posts, articles and thoughts that will prove to be wide ranging, enjoyable and of worth to our clients. There’s little point in us regurgitating the same news published elsewhere, therefore we attempt to provide something slightly edgier and thought provoking, whilst still ensuring our customers eye is kept on the ball in relation to the key events and issues of the day.

http://blog.fxcc.com/making-sure-you...on-forex-news/


Source: FX Central Clearing Ltd. (FXCC – BLOG)

[alayoua]

Update - Daily Technical Levels from FXCC – 23 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.3575
Preference: Short positions below 1.3575 with targets @ 1.3385 & 1.332 in extension.
Alternative Scenario: Above 1.3575 look for further upside with 1.363 & 1.37 as targets.
Comment: the pair is breaking below its support and should reach its previous low.

USD/JPY Intraday Technical Levels:

Pivot: 76.55
Preference: Short positions below 76.55 with targets @ 76.1 & 75.95 in extension.
Alternative Scenario: Above 76.55 look for further upside with 76.7 & 77 as targets.
Comment: the pair is under pressure and is approaching its support.

GBP/USD Intraday Technical Levels:

Pivot: 1.547
Preference: Short positions below 1.547 with targets @ 1.537 & 1.5325 in extension.
Alternative Scenario: Above 1.547 look for further upside with 1.552 & 1.5575 as targets.
Comment: the pair stands below its resistance and is shaping a bearish flag.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Daily Technical Levels from FXCC – 26 Sep 2011


EUR/USD Intraday Technical Levels:

Pivot: 1.3475.
Preference: SHORT positions @ 1.3465 with 1.3385 & 1.332 in sight.
Alternative Scenario: The upside breakout of 1.3475 will open the way to 1.3575 & 1.363.
Comment: the pair remains under pressure and is approaching its previous low.

USD/JPY Intraday Technical Levels:

Pivot: 76.70.
Preference: SHORT positions @ 76.65 with 76.1 & 75.95 in sight.
Alternative Scenario: The upside breakout of 76.7 will open the way to 76.9 & 77.1.
Comment: the pair remains under pressure and is approaching its support.

GBP/USD Intraday Technical Levels:

Pivot: 1.5500.
Preference: SHORT positions @ 1.549 with 1.537 & 1.5325 in sight.
Alternative Scenario: The upside breakout of 1.55 will open the way to 1.5575 & 1.563.
Comment: the RSI is capped by a declining trend line, the pair stands below its resistance and should face a weakness.


Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

Forex Market Roundup – September 26

So a nuclear physicist, a lawyer and a history student walk into a meeting..if you were expecting a joke, or an ending with a punchline, then I’m sorry to disappoint. The nuclear physicist is Ms. Merkel, the lawyer is Ms. Lagarde and the history student is one George Osborne and this trinity of (supposed) brilliant minds have very different ideas and agendas as to how to heal both Europe’s and the global financial community’s debt crises. Everything is changing. People are taking their comedians seriously and the politicians as a joke, but the ultimate cost of the final European ‘stability fund’, at circa €3 trillion, is no joke.

If you had to objectively pin your hopes on one of their diverse rescue theories you may choose the non politician’s, however, you’d quickly recall the Ms Lagarde was a politician until two months back and still is. All politicians should have 3 hats – one to throw into the ring, one to talk through, and one to pull rabbits out of if elected and Ms Lagarde’s appointment, as the ‘elected’ head of the IMF, was undoubtedly a political appointment and she’s desperately searching for that one single rabbit to pull out the hat.

One improvement and development of the multitude of G20, IMF, ECB, FED meetings that have taken place on both sides of the Atlantic during the past two weeks, is that finally a unified policy appears to be taking place. An injection of funds into a number of continental banks is the cornerstone of the new and revised three-pronged plan being discussed to ‘save’ the single currency. Finally we get to learn the size of the potential cheque that’ll be stiffed onto the unsuspecting citizens of the seventeen members of the Eurozone, and a few others who’ll have to contribute in order to keep the shrapnel and collateral damage to a minimum. The combined cost could be a truly jaw dropping €3 trillion and it involves giving additional firepower for the European Financial Stability Facility (EFSF).
http://blog.fxcc.com/september-26-am

Source: FX Central Clearing Ltd. (FXCC – BLOG)

[alayoua]

Update - Daily Technical Levels from FXCC – 26 Sep 2011

EUR/USD Intraday Technical Levels:

Pivot: 1.3575
Preference: Short positions below 1.3575 with targets @ 1.3425 & 1.336 in extension.
Alternative Scenario: Above 1.3575 look for further upside with 1.363 & 1.3695 as targets.
Comment: the pair should strike against its strong resistance as the RSI lacks upward momentum.

USD/JPY Intraday Technical Levels:

Pivot: 76.6
Preference: Short positions below 76.6 with targets @ 76.1 & 75.95 in extension.
Alternative Scenario: Above 76.6 look for further upside with 76.9 & 77.1 as targets.
Comment: the pair has struck against its new resistance and remains under pressure.

GBP/USD Intraday Technical Levels:

Pivot: 1.542
Preference: Long positions above 1.542 with targets @ 1.5575 & 1.563 in extension.
Alternative Scenario: Below 1.542 look for further downside with 1.537 & 1.5325 as targets.
Comment: the pair is on the upside and is breaking above its resistance as the RSI has broken above its declining trend line.

Daily Technical Levels from fxcc.com
Source: FX Central Clearing http://www.fxcc.com

[alayoua]

The Zloty Loses its Slot

Please no laughing at the back of the class, the Polish currency, the zloty, is apparently falling out of favour with investors and speculators. Are you thinking what I’m thinking, that it’s a shame they didn’t ditch their sovereign currency in 2002 and join the euro?

Trading humour can be so cruel. The zloty is down 16 percent against the dollar and 9.9 percent versus the euro this quarter as the worst performer amongst the European currencies. “The zloty was not so long ago the darling of Europe, Middle East and Africa regions but these days are gone,” Benoit Anne, the head of global emerging-market strategy at Societe Generale SA in London, said in a phone interview with Bloomberg, “It used to be a very strong fundamental story and you don’t have it anymore.”

Poland’s was the only European Union economy to avoid recession after the global credit crisis in 2008 caused record purchases of government’s bonds. The economy expanded an average 4.4 percent a year since 2007, compared with 0.1 percent in the EU. However, that artificial ‘growth’ came at an obvious price; Poland’s budget deficit has more than quadrupled since 2007 to 7.9 percent of GDP last year, the widest gap since at least 1996, according to data compiled by Bloomberg.

Contagion thoughts took a twist in an unfamiliar direction yesterday, with news that Danish banks are experiencing their own crisis and it’s deepening due to the new government’s plans to impose taxes on lenders, this threatens to deplete capital at a time when most of the country’s banks have no access to funding markets.

“The banks are under severe stress,” said Jesper Rangvid, professor of finance at Copenhagen Business School, in an interview with Bloomberg. Imposing extra taxes on the country’s banks “definitely does not contribute to banking stability.”

Stocks rallied yesterday, rebounding from last week’s slump. Commodities reversed losses and the Dollar Index declined. The Standard & Poor’s 500 Index jumped 2.3 percent to close at 1,162.95 at 4 p.m. in New York. The S&P 500 is down circa 12 percent since the end of June, heading for its worst quarterly performance since 2008. Ten-year U.S. Treasury note yields added six basis points to 1.90 percent, rising from a close to record low. The Dollar Index lost 0.5 percent, while the euro fell against 12 of 16 major peers. Financial shares ranked among the session’s best performers, with the KBW Bank Index up 5.3 percent. Dow component JPMorgan Chase & Co advanced 7 percent to $31.65 while Citigroup Inc gained 7 percent to $26.72.
http://blog.fxcc.com/september-27-am/

Source: FX Central Clearing Ltd. (FXCC – BLOG)

[alayoua]

“Love Letters Straight from the Heart” – of Greece’s Turmoil

Investors are wary as inspectors from the EU and IMF head to Greece in order to forensically scrutinise their revised austerity plans. German Chancellor Angela Merkel has her own issue, attempting to defuse a revolt within her own government ahead of the absolutely crucial vote on Thursday to expand Europe’s bailout fund. The international auditors return to Athens on Thursday to deliver a verdict on whether or not Greece’s tougher austerity measures qualify for aid to avert a default that would plunge the country into bankruptcy.

Inspectors from the European Union (EU) and International Monetary Fund (IMF) quit Greece on September 2, after the government failed to convince its measures were robust enough (in terms of deficit cuts and economic reforms) to deserve further payments under its €110 billion bailout. Before returning, the EU/IMF mission, known as the “troika,” demanded written assurances by Greek authorities that the new pledges will be met. Prime Minister George Papandreou and Finance Minister Evangelos Venizelos provided assurances in letters they sent to the troika. The contents were not made public, but the troika visit is conditional on the letters being convincing. Analysts expect the talks to smooth the path for the sixth bailout tranche for Greece, money the country needs to quite simply avoid running out of cash next month plunging the euro zone into an even deeper crisis.

Joerg Kraemer, an economist at Commmerzbank;

I think euro zone finance ministers will in the end release the next tranche of bailout payments for Greece. They will not dare turning off the tap on Greece right now, it’s a political decision.

Commodity stocks drove Wall Street down in late Wednesday trade, the declines in energy and metals prices hit investor concerns regarding overall global economic weakness and Europe’s debt crisis. A seven percent drop in the price of copper (a leading indicator for the global economy) led to a drop of 4.5 percent in the S&P materials index. Silver plunged 5 percent to lead losses in 23 of 24 commodities tracked by the S&P GSCI Index. This commodities gauge has slumped circa ten percent since the end of June, heading for its worst quarterly loss since a 44 percent plunge in the fourth quarter of 2008

Wednesday’s final declines places the SPX on course for its worst quarter since the financial crisis in the fourth quarter of 2008. The four day rout last week erased $1 trillion from U.S. equities amid concern Greek insolvency and default is inevitable. The decline left the S&P 500 trading at 12.4 times earnings in the past 12 months, 4.4 percent below its average valuation at the lowest point during the last nine bear markets – Bloomberg.

The euro also reversed early gains versus the dollar, investors watched for signs of progress in Europe’s efforts to stem the debt crisis. Treasuries trimmed losses, the 10-year note’s yield capped the biggest four day increase since January 2009. The SPX lost 2.1 percent to 1,151.06 at the close in New York after climbing 0.8 percent earlier and rallying 4.1 percent over the previous three sessions. The euro weakened 0.2 percent erasing a 0.8 percent advance. Ten-year yields rose two basis points to 1.997 percent. Oil lost 3.8 percent after U.S. supplies increased last week.

Man Group Plc crashed a stunning twenty five percent, the most since November 2008, after the world’s biggest hedge fund said its assets under management will decline by $6 billion amid the “suppressed” demand for its investment products.

The SPX closed down 2.07%, the Russell index collapsed by 4.51% to leave it negative year on year. The UK FTSE closed down 1.44%, the DAX, CAC, STOXX, closed down by a mean of approx.1%. The FTSE equity future is currently down circa 1% and the SPX future is flat. The CAC future is down circa 1% and the DAX future down 0.53%. Sterling is down versus dollar, yen and flat versus the franc. The Aussie dollar has fallen hard versus the USA dollar. The euro has fallen versus all the major pairs.

Publications of note that may affect the morning London session sentiment include the following;

07:00 UK – Nationwide House Prices Sept
09:30 UK – Net Consumer Credit Aug
09:30 UK – Mortgage Approvals Aug
09:30 UK – M4 Money Supply Aug
10:00 Eurozone – Consumer Confidence Sept
10:00 Eurozone – Economic Confidence Sept
10:00 Eurozone – Industrial Confidence Sept.

Notwithstanding the troika ‘visit’ the various Eurozone consumer publications could affect market sentiment. Industrial confidence is expected to fall sharply – a survey of analysts by Bloomberg predicts a figure of -5, from last month’s figure of -2.9. Predictions for the other two surveys suggest similar readings to previous months.
http://blog.fxcc.com/september-28-pm

Source: FX Central Clearing Ltd. (FXCC – BLOG)

[alayoua]

In a late rally US stocks climbed to end the day in positive territory. The SPX closed up 0.81% to be back in positive territory year on year. Whilst the markets expected a unified vote by the German government to be duly ratified disappointing consumer confidence figures weighed heavily in mid afternoon trade. Consumer confidence in the USA slumped last week to the second-lowest level on record as Americans grew more concerned with their financial situation and the buying climate worsened. The Bloomberg Consumer Comfort Index dropped to minus 53 in the period ended Sept. 25 from minus 52.1 the prior week.

The full outcome of the latest troika meeting is still to be revealed. Presumably the markets have, in similar fashion to the German bailout vote, already priced in a positive outcome. The depth of the rabbit hole has been potentially exposed by the head of Europe’s markets regulator who is warning banks to be consistent in their valuations of sovereign debt amid concern some lenders have failed to record sufficient losses on Greek bonds. Quite where they’ll move the hidden losses to remains to be seen. Steven Maijoor, chairman of the European Securities and Markets Authority, likened the lack of transparency about banks’ individual holdings of government debt to the subprime mortgages that triggered the credit crisis.

Lack of transparency regarding exposures to subprime mortgages created a situation of uncertainty about the financial positions of banks, a lack of transparency from banks on their exposures to sovereign debt and related instruments are generating new suspicions about the conditions of individual banks and this requires similar answers in terms of transparency. We are currently looking at how banks are applying International Financial Reporting Standards for the valuation of sovereign debt, It is very important for ESMA that financial institutions apply IFRS correctly, and are consistent in their valuations of sovereign debt exposures.

The International Accounting Standards Board have accused banks of failing to write down the value of their Greek government debt to reflect market prices; the mark to model as opposed to market phenomena is alive and well. Lenders’ impairments on Greek government ranges from 6 percent to as much as 51 percent in the second quarter, according to analysts at Citigroup Inc.

Bigger challenges loom for the euro zone now. Financial markets are already anticipating a likely Greek default and demanding more far-reaching measures to prevent the crisis that began in Athens from spreading far beyond Europe and its banks.
http://blog.fxcc.com/september-29-pm/

Source: FX Central Clearing Ltd. (FXCC – BLOG)

[alayoua]

The same headline is constantly being regurgitated by the usual financial media outlets day after day, it repeats something like this; “US Stocks and the Euro fall as Greece concerns outweigh positive U.S. economic data..” Or we read something similar to the following most days of the week; “Large U.S. bank stocks fell sharply on concerns that lenders like Citigroup Inc and Morgan Stanley may face more earnings setbacks from the debt crisis in Europe.”

The constant inference appears to be that the SPX and the Dow Jones stock indices are falling due to the Eurozone debt crisis and not due to the mess the USA is in and has been since 2007-2008. “Oh look, our economic indicators are healthy, if only those pesky Europeans could get their act together.” Sure and..”If only that trinity and axis of unholy financial evil that was Northern Rock, Halifax Bank of Scotland and Cheltenham and Gloucester hadn’t invented the subprime mortgage securitisation business, causing Lehman to collapse, we’d all be living in €1 million houses with $300K mortgages.”

Perhaps it’s time for the headline writers in the USA mainstream media to join up the following words; houses, glass, in, people, living, bricks, throw, shouldn’t..

As America officially closes its books on the 2010-2011 fiscal year the final trading day of the year saw the settlement of all the outstanding and recently auctioned off debt. Like families splurging their last pay cheque of the year on an Xmas blow-out there was a final intoxicated surge of $95 billion in total government debt overnight, the result being a closing ‘balance’ of the USA being circa $14.8 trillion in debt. During the past fiscal year, the US has issued a total of $1.228 trillion in new debt. At a rate of $125 billion per month US debt to GDP will pass 100% inside a month. The US economy added over 3$ trillion in debt during the past two years and the stock market is almost back to 2009 levels. All that effort, all that money, all that fresh debt and dollar debasement (to be covertly dumped on the masses) and the end result? Zero growth, nada. Yep, it’s all the fault of those Europeans..or could it be the Chinese..?

The US Senate voted on Monday evening to push forward legislation designed to press China to let its yuan currency rise in value, creating a debate between lawmakers who say the bill will create jobs and critics who warn it could initiate a trade war. Over sixty senators voted to allow debate on the bipartisan Currency Exchange Rate Oversight Reform Act of 2011, which would allow the U.S. government to place countervailing duties on products from countries found to be (in the opinion of the USA) subsidising their exports by undervaluing their currencies. In short countries and economies who don’t do what the USA admin demands are wrong, period.

Manufacturing in the USA grew in September as production and hiring increased. Other data news for the struggling U.S. recovery indicated strong demand for new motor vehicles, construction spending unexpectedly rebounded in August. September marked a 26th straight month of expansion. The Institute for Supply Management said its index of national factory activity rose to 51.6 last month from 50.6 in August, boosted by a rebound in production and increased factory hiring. However, new orders fell for a third straight month suggesting that the underlying conditions are flat.

http://blog.fxcc.com/october-3-pm/


Source: FX Central Clearing Ltd. (FXCC BLOG)

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The Weird and Wonderful World of Forex Use a dealing desk forex broker and at some stage you’ll probably start to notice a strange pattern emerging. Stuff that just doesn’t make any sense at all, repeated over and over again till it becomes more or less the accepted norm.

This is what we mean by the weird and wonderful world of forex. Also known as “stuff you broker says might not be the stuff your broker does”.

A broker by definition is a facilitator, a go-between. Brokers match a buyer to a seller and make a commission for the introduction. A broker has two duties to perform, depending on who he’s acting for. To get the highest possible offer from the buyer, or the lowest possible price from the seller.

Things start to get a bit more complicated when a broker also has an interest in the outcome of the transaction. Take a real estate broker for example. If he owns a share in a particular property and stands to make a profit from the sale price, how hard is he going to work in getting the price down a potential buyer? Answer is, probably not very hard at all.

In the case of dealing desk forex brokers, that’s pretty much the case. Dealing desks don’t always hedge client trades, meaning they could well be left holding losing positions. You make money – they lose. You lose – they profit. If they can bias things in their favour they just might. After all, dealing desk brokers employ traders and my guess is they don’t employ them to lose money.

Considering they know where your stops are and have been known to re-quote in the past… You can probably guess where this is going.

FXCC doesn’t have a dealing desk. We don’t have any risk to hedge and all your trades go directly to our liquidity providers. You trades remain anonymous and all our providers ever see is the FXCC system.

We though the world of online forex was so weird and wonderful we even wrote a report about it, titled, perhaps a bit unimaginatively, The Weird and Wonderful World of Forex.

Give us an email address in the form at the top and we’ll get your copy straight to you. It’s well worth the read, even if we say so ourselves.
http://blog.fxcc.com/the-weird-and-w...orld-of-forex/

Source: FX Central Clearing Ltd. (FXCC BLOG)

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Daily Technical Analysis By FXCC - 05/10/2011

Euro vs. US Dollar (EURUSD):Weakness in EURUSD is likely to continue.We see a less chances of an immediate rise on the instrument for short-term technical outlook. Next downside barriers follow (1.32871) at (1.32050) and (1.31638).We will try to sell EURUSD from our mentioned resistance levels.

R1: 1.34150 | R2: 1.34794 | R3: 1.35197 | R4: 1.36010 | R5: 1.36526
S1: 1.32871 | S2: 1.32050 | S3: 1.31638 | S4: 1.30633 | S5: 1.29812

Great Britain Pound vs. US Dollar (GBPUSD):We can say that additional bearish movements could be seen during current session, particularly if it succeeded to maintain prices below (1.55043) zones. A proper confirmation would occur if the GBPUSD will manage to fall beyond the (1.54322) support level.Our bias is on selling GBPUSD with a stop loss above (1.55043) for today.

R1: 1.55399 | R2: 1.55940 | R3: 1.56654 | R4: 1.57156 | R5: 1.58473
S1: 1.54322 | S2: 1.53406 | S3: 1.52866 | S4: 1.52325 | S5: 1.51329

US Dollar vs.Japanese Yen USDJPY (USDJPY):general trend is to the upside. Break below (76.412) may trigger further fall of the USDJPY. Going above nearest support level at (77.675), however, would confirm continuation of the bullish trend, towards next objective upwards (78.275). Our bias is on buying USDJPY with a stop loss under (76.412) for today.

R1: 77.194 | R2: 77.675 | R3: 77.975 | R4: 78.275 | R5: 78.575
S1: 76.495 | S2: 76.106 | S3: 75.806 | S4: 75.506 | S5: 75.206

Source: FX Central Clearing Ltd. (FXCC)
http://www.fxcc.com/tech-analysis

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Elliot Wave Theory and the Madness of Crowds

The famed analyst and market technician Robert Prechter came across Ralph Elliott’s work while working as a market technician at the investment bank Merrill Lynch. His prominence as a forecaster, during the bull market of the 1980s, brought the greatest exposure to Elliott’s work.

Prechter remains the most widely known Elliott analyst. Robert Prechter is an author and co-author of 14 books, his book “Conquer the Crash” was a New York Times bestseller. He published his monthly financial commentary in the newsletter “The Elliott Wave Theorist” from 1979 and is the founder of Elliott Wave International. Prechter served on the board of the Market Technicians Association for nine years. In recent years Prechter has supported the study of socionomics, a theory about human social behaviour.

Ralph Elliott was a professional accountant, who discovered the underlying social principles and developed the analytical tools of what was later to be known as the Elliot Wave Principle in the 1930s. He proposed that market prices unfold in specific identifiable patterns, which practitioners today call Elliott waves, or simply “waves”. Elliott published his theory of market behaviour in the book “The Wave Principle” in 1938 and covered it comprehensively in his major work, “Nature’s Laws: The Secret of the Universe” in 1946. Elliott stated that “because man is subject to rhythmical procedure, calculations having to do with his activities can be projected far into the future with a justification and certainty heretofore unattainable”.

The Elliott Wave Principle is a detailed description and ‘formula’ of how groups of people think and as a consequence behave. EWP reveals that mass psychology causes swings from pessimism to optimism and back in a natural rhythmic sequence, thereby creating specific and measurable patterns. The Elliott Wave Principle can be clearly seen ‘at work’ in the financial markets, where changing investor psychology is recorded in the form of price movements. If you can identify the repeating price patterns and figure out where price is in those repeating patterns you can hopefully predict (with reasonable levels of probability) where price is headed next.

The EWP is, however, still fundamentally an exercise in probability. An Elliottician is someone who is able to identify the markets’ structure and anticipate the most likely next move based on the position within those structures. By knowing the wave patterns, you’ll know what the markets are likely to do next and just as importantly what they will probably not do next. By using EWP it’s possible to identify the highest probable moves with the least risk.

In Elliott’s model market price alternates between an impulsive motive phase and a corrective phase on all time scales of the trend. Impulses are subdivided into a set of 5 lower-degree waves, alternating between the motive and corrective character, waves 1, 3, and 5 are impulses, and waves 2 and 4 are smaller retraces of waves 1 and 3. Corrective waves subdivide into 3 smaller waves starting with a five-wave counter-trend impulse, a retrace, and another impulse. In bear markets the dominant trend is downward, so the pattern is reversed, five waves down and three up. Motive waves always move with the trend, while corrective waves move against it.

Read the full story
http://blog.fxcc.com/elliot-wave-the...ness-of-crowds

Source: FX Central Clearing Ltd. (FXCC BLOG)

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Daily Technical Analysis By FXCC - 07/10/2011
Euro vs. US Dollar (EURUSD):It's likely that EURUSD will decline. A break above (1.34608) could be a threat to the bearish scenario targeting (1.36680) even (1.37201). On the downside, immediate support is at (1.33837). Break below that area should keep the major bearish scenario intact testing (1.32414) area We will be looking to sell EURUSD upon any price retracement.


http://r.4xeagleeye.com/snap/fxcc.com/EURUSD/c/0

R1: 1.34794| R2: 1.35197 | R3: 1.35854 | R4: 1.36680 | R5: 1.37201
S1: 1.33837 | S2: 1.33305 | S3: 1.32414 | S4: 1.31666 | S5: 1.30919
 
Great Britain Pound vs. US Dollar (GBPUSD):We prefer a downside scenario at this phase. Since bias is bearish in nearest term targeting (1.50803). Another move back above (1.55117) could lead us to neutral zone. We will try to sell GBPUSD from our mentioned resistance levels.

http://r.4xeagleeye.com/snap/fxcc.com/GBPUSD/c/0

R1: 1.54943| R2: 1.55988 | R3: 1.56654 | R4: 1.57156 | R5: 1.57706
S1: 1.53406| S2: 1.51760 | S3: 1.50803 | S4: 1.49459 | S5: 1.48959
 

US Dollar vs. Japanese Yen USDJPY (USDJPY):The USDJPY still trapped in range area of (76.926– 76.462). A break in either direction will determine the trading bias in today`s session. Break below (76.462) could trigger further bearish pressure targeting (75.434), while break above (76.926) could trigger further bullish advances testing (77.996). You may try to buy from lower border and/or sell from upper border.

http://r.4xeagleeye.com/snap/fxcc.com/USDJPY/c/0

R1: 77.023 | R2: 77.396 | R3: 77.696 | R4: 77.996 | R5: 78.296
S1: 76.334 | S2: 76.034 | S3: 75.734 | S4: 75.434 | S5: 75.134

Source: FX Central Clearing Ltd. (FXCC)
http://www.fxcc.com/tech-analysis

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The Mathematics of Money Management in Forex Trading

As Forex traders we have to come to terms with the elements of trading that are completely out of our control. In order to progress we have to accept, (even begin to embrace), that lack of control very early on in our personal trading evolution. Price is obviously the most prominent trading factor bar none and equally there’s one immutable fact, price is a trading factor that we have absolutely no control over. For us to become successful forex traders we have to accept that we have no control over what price will do, we can only take a position in our chosen market based on our interpretation of probability. The risk in the market is not what we want it to be. The risk is what the market imposes upon us.

That probable outcome and our ‘judgement call’ can be underscored by; pattern recognition, indicators, price action, waves, fundamental news or a combination of several of the aforementioned mentioned mechanisms. However, using any of the aforementioned does not guarantee success, only underpinning the technique with sound money management will create long term success.

Many new traders use the phrase “I was right” when an individual trade is successful. However, you’re not right or wrong, if you reduce trading down to being right or wrong, whilst accepting that price is not under your control, how can you be right? Can a trader who accepts the factor of probability underscoring his or her performance genuinely give themselves credit for being right, or moreover should they in fact credit themselves with sticking their plan? You cannot realistically give yourself credit for ‘guessing’ right, but you can congratulate yourself for planning your trades and trading your plan.

There are aspects of trading that we can control, emotions being one, we can also control risk per trade and control that risk almost to the pip by using mathematics. We can control; stops, limits, percentage losses of our accounts per day, per week, per month. In order to be successful it’s incumbent on us to leverage that single and most important element of control we can have over our trading.

Ralph Vince has written several theoretical books on the topic of money management in trading. He illustrates, time and time again, that there’s a mathematical certainty you will go broke if you don’t trade systematically by controlling risk. Another celebrated trading mind, Van Tharp, has dined out several times on the strength of the following anecdote concerning Ralph Vince’s theory of money management…
Read the full story
http://www.fxcc.com/trading-tools
http://blog.fxcc.com/the-mathematics...forex-trading/

Source: FX Central Clearing Ltd. (FXCC BLOG)

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Daily Technical Analysis By FXCC - 10/10/2011
Euro vs. US Dollar (EURUSD):maintains a bid tone for now. Break above (1.35345) may trigger further recovery of the EURUSD. Going bellow latest swing low at (1.33305), however, would confirm continuation of the bearish trend, towards next objective downwards (1.30908). You may try to sell from (1.34745), (1.35245), and (1.35813) with a stop loss above (1.35345).

R1: 1.34745| R2: 1.35245 | R3: 1.35813 | R4: 1.36380 | R5: 1.37448
S1: 1.33305 | S2: 1.32543 | S3: 1.31638 | S4: 1.30908 | S5: 1.30508


Great Britain Pound vs. US Dollar (GBPUSD):The bias remains neutral in nearest term. A need for a clear break from the range area (1.56560 – 1.53850) so we can see clearer direction. Break below (1.53850) could trigger further bearish pressure targeting (1.52122) and keep the major bearish scenario remains strong while break above (1.56560) could trigger further bullish correction testing (1.59868). We need to keep a closer look on how prices would behave on today`s trading session.

R1: 1.56460| R2: 1.57637 | R3: 1.58815 | R4: 1.59868 | R5: 1.61046
S1: 1.54943| S2: 1.54353 | S3: 1.53406 | S4: 1.52122 | S5: 1.50944


US Dollar vs. Japanese Yen USDJPY (USDJPY):We believe that possible bullishness could be seen during this trading session. Support is at (76.462). Break below that area could lead us to neutral zone as direction would become unclear, but as long as price moves above that level the major scenario remains bullish. Try to buy on depth with a stop loss below (76.462).

R1: 77.175 | R2: 77.502 | R3: 77.802 | R4: 78.102 | R5: 78.402
S1: 76.388 | S2: 76.061 | S3: 75.761 | S4: 75.461 | S5: 75.161

Source: FX Central Clearing Ltd. (FXCC)
http://www.fxcc.com/tech-analysis

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Picking the Right Forex Tools to Aid Your Trading Progress

Having discussed at length the position size calculator in a previous article, we thought it might be an opportune time to discuss other forex tools which should prove useful as part of your armoury of weapons to take on the FX market. These tools fall outside the normal scope available from your FX broker and as part of our continual commitment to our clients we intend to (once compiled, tested and our own intellectual property) make these tools permanently and freely available to our client base.

There may be other tools for inclusion in our FX toolbox that you’d like to recommend and as this list is only a starting point please feel free to be pro-active with any additional recommendations in the comments section at the foot of the article. Naturally we’ve left out the obvious main tools such as charts and the more experienced traders amongst us will already automatically reference many of these tools throughout the appropriate times of the day or week. However, many of us will testify that we’ve occasionally missed a blindingly obvious move in the markets by forgetting to pay attention to certain freely available tools. Many of us still miss key economic announcements, many position traders or ‘currency investors’ could operate singularly through the COT report, a sentiment index, the VIX and the Fed’s implied volatility rate and there’s many a trader who will still ask; “what time does NY open when the UK British summer time ends?”

Some of these tools you’ll have to bookmark yourself and be professional and disciplined enough to visit each resource on a daily basis. Some are not free, such as a squawk service and there’s often a one off charge to have, for example, a world clock sit inside your browser, nevertheless it’s up to you as a professional to examine your needs and requirements.
Position Size Calculator

So let’s start with the position size calculator. By putting in your account balance, your risk tolerance in percentage (or money value) and the stop in pips the calculator automatically gives you a lot size. Whether full lots, mini lots, or micro this calculator is invaluable to traders new to FX trading. As we progress we automatically ‘do the math’ in our head, however, this calculator is one of the most important tools given it is a key money management resource.
Economic Calendar Events List

Currency price reacts to fundamentals. Being aware of which fundamental news releases are scheduled for release on any given day should form part of any trader’s pre market preparation. FXCC produce an economic calendar that’s as comprehensive as you need.

Read the full story
http://blog.fxcc.com/picking-the-rig...ading-progress

Source: FX Central Clearing Ltd. (FXCC BLOG)