FOREXYARD: Forex News Blog

---

The EUR Recovers from 3 Month Low vs. Dollar Posted: 17 Dec 2009 11:42 PM PST The European currency rose against the U.S dollar Friday, ending 3 days of losses on speculation a German report may show business confidence rising to the highest since July 2008. The Ifo institute in Munich is forecasted to say its business climate index rose to 94.6 from 93.9 in November, a sign the economic recovery is on track. The EUR also gained after Reuters reported that Pakistan denied a coup had taken place in the country, reviving demand for higher-yielding assets. The EUR rose to $1.4396 from $1.4338 yesterday after earlier falling as low as $1.4306. The single currency also rebounded vs. the Japanese yen to 128.64, after earlier dropping to 127.54 yen, the weakest since Nov. 27. However, the market’s expectations persist that the downward movement for the EUR remains intact. The EUR has long been bought on the view that it could be a potential replacement of the greenback as a reserve currency. But with the U.S. economy improving and with signs of worsening public finances in the Euro-Zone the trend for the EUR is going further down. The common currency’s weakness may accelerate against the USD in the last 2 weeks of December with 1.42 and 1.4160 as next price targets.

Determine the Reversal Posted: 11 Dec 2008 03:37 AM PST Lately I have noticed that many ForexYard traders are attempting to determine the reversal of the trend, and not go along with it. Well then first of all, if you consider yourself as a relatively fresh trader, let me advise you to go the other way around – it is much safer to detect a trend (ForexYard does its best to provide you with the daily and weekly trends every day) and just follow it. It is a lot tougher to see the trend and predict when and where it will reach its end. And still, if you feel safe enough, and experienced enough to predict a dramatic change in the market – here are some ideas on how to obtain more successful strategies. 1. Do not rely on fundamental analysis exclusively to predict a strong-swift price change in the market. It doesn’t work this way. True, on the long-term the fundamental analysis will indeed determine which currency is stronger, and what is the true value of this or that commodity, but doing the right thing for the long-term won’t really console you when your open position lost 300 pips and treated you with a brand new margin call. 2. There are various technical indicators that we provide on our platform that are relatively liable in predicting the end of the trend; here are two suggestions how to use them. a. Relatively Strength Index (RSI) – the RSI is an oscillator that follows the average price and provides you an index on how strong is the purchasing power currently in the market. When the RSI peaks above the 70 line or bottoms below the 30 line and then turns back to cross those lines towards the other direction – the market tends to follow it, meaning the trend is likely to reverse. b. Slow Stochastic – the Slow Stochastic is one of the most renowned technical oscillators. The reason for it is that it’s relatively easy to use, and is considered to be more accurate than most of the others. It is a momentum indicator that compares where an asset’s price closed relative to its price range over a period of time. When the two lines are crossing one another above the 80 line, it is a signal that a bearish reversal might be impending and vice versa. 3. If you are already paying attention to the chart and utilizing it for your trades – learn the different patterns. If you are looking for the reversal, learn how to observe the “W” “M” structures, they are considered to be one of the best ways to technically predict a reversal. 4. Fibonacci Retracement – this is an amazing tool that our platform provides you, and I bet that most of you don’t even know what Fibonacci Retracement is… Draw the lines from the upper price to the lowest one, and see how the trend tends to magically reverse when it reaches one the middle lines. I will strongly suggest that you’ll read more about it (traders that deposit $5,000 to their ForexYard account are entitled to a CD that includes more detailed Fibonacci training, among other great tips). 5. And last, this might sound incredibly obvious but it is so imperative, and so hard to accomplish. Plan in advance what you are trying to achieve and stick to the plan. It is merely a matter of discipline, and it is as vital as any other effort you will take. If you know what to do, but instead of trusting your mind you follow your so called instincts and feelings (I don’t care how you call it) then all your knowledge is worthless. Remember that! That’s it, the only thing I have left to wish you all is to enjoy your trading experience. Just like any other aspect of life, this is the most important thing.

You are subscribed to email updates from Forex Trading Education : Forex Trading Blog by FOREXYARD » trend reversal To stop receiving these emails, you may unsubscribe now.	Email delivery powered by Google
Google Inc., 20 West Kinzie, Chicago IL USA 60610