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Markets Lower
September 14, 2020

Markets Lower as Fitch Comments Cause Concerns; S&P 500 Support Seen at 1226

Risk sentiment is dropping, starting with the Asian session after Fitch comments suggesting that the sovereign debt crisis is likely to spread to more countries and that it has the potential to lead to credit downgrades for banks in the United States. The only positive in the statement was the assertion that US banks have reduced their exposure to troubled European assets. Either way, the comments wound up being the driving factor on the day as even the strong Industrial Production number out of the US could do nothing to change price trajectory.

The macro data should be given attention, however, even if markets are not putting most of the focus there in the short term. Inflation in the US came in at an elevated 3.5% for the headline figure but the core figure showed more evidence of price stability. Treasury inflows also beat market expectations but matched our estimates mentioned yesterday, which were based on the recent strength seen in the US Dollar. Today, the macro calendar is much lighter and there are no scheduled monetary policy meetings, so we could see some consolidation of yesterday’s declines (i.e. a decrease in price volatility).

One potential point of activity could come from the Treasury bond auctions that will take place in Europe, so any news flows from this could be paid attention. In Italy, Mario Monti assumed his new position as prime minister (backed by a technocrat cabinet) and markets will be watching his comments closely to gauge his plans to solve Italy’s debt issues and the probability of achieving political majorities in what could be described as a fractured government. Ranges in the EUR/USD have moved down to 1.3420-1.3480 while the USD/JPY remains heavy at 76.90-77.10.

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Markets Lower
Working
August 21, 2020

A Beginner’s Guide to Foreign Exchange Trading

Foreign Exchange or Forex, as a concept, sounds something of a big deal that not many would want to take up for perusal. People do not use forex every day in their lives, in their 9 to 5 jobs, and that is why the idea of studying it in great depth might not occur. However, the domain is broad, and one can always start by learning the basics of forex trading if they are interested in it. In this article, we shall cover the basic points about forex trading, which can act as a pathway to the bigger world of trading out there. Therefore, without any further ado, let us move on to learn a few basic things about forex trading and solidify our understanding about it.

A Working Definition:

We shall begin with providing a working definition of foreign exchange trading to lay the grounds first. From the very name of it, we can understand that forex stands for foreign exchange. Foreign exchange is the process of currency trading. Simply put, it is the process of buying or selling one currency in exchange for another. It might not occur to you, but when you travel overseas and exchange the currency of your home country in exchange of the one that is used in the foreign country, you partake in the global foreign exchange market. At any given point in time, you can enter the space of forex trading without much capital at hand. And that is why we must look into the basics to make the job of forex trading easy for you.

Exchange Trading

About Currency Pairs Primer:

In this section of the article, we shall talk about currency pairs and their significance. Forex trading always takes place in pairs, and this means that there are always two currencies involved while trading. This is so that the exchange signifies the value of one currency in relation to the other. There are also specific symbols used to denote the pairs of currencies. For instance, EUR/USD is used to denote the pair of Euro and US Dollar. The final thing that we must understand about foreign exchange is that there is always a market price associated that denotes how much of the second currency is required to purchase the first currency.

A Quick Note on Paper-Trading Accounts:

The final thing that we must touch upon in this article is that of the paper-trading account. This is the process where you fake trade through a paper-trading account to check how much prices move in real-time. There are online portals and mobile apps too that offer such accounts. However, the advantage of these mobile apps is that they do not put your capital at any risk.

Paper-Trading Accounts

Conclusion:

These were some basic points about foreign exchange trading that we have covered in the article. There are several other factors that you need to consider when you take up forex trading. However, these points shall be a good start for anyone who is just starting out.

Foreign Exchange Trading
Exchange Trading
June 12, 2020

Tips that Every Foreign Exchange Trading Beginner Can Make Use of

Foreign exchange trading seems like an elusive concept, especially for the ones who are very new to the discipline. There are several terms and jargons that dominate this sphere, and it is important to understand them to ace the domain. However, for beginners, we have a few tips that they might want to wrap their heads around and make educated decisions about trading. If you are a beginner yourself, this article might be just the right one for you. Therefore, let us look into these tips and see how one can navigate the domain and minimize the risks of running losses.

Have an Understanding of the Market:

The first thing that you must do before you start trading is to gain some knowledge about the forex markets. One cannot understate the importance of understanding the foreign exchange markets, especially for those who want to start trading in this field. There is a lot to explore, learn and add to your trading vocabulary. It is essential that you invest some time in learning all that you can about the market to make better decisions.

Market

Pay Attention to the Forex Market Predictions:

Market predictions are always available on the internet, apps, newspapers and various outlets of media. You need to pay attention to all the forecasts and predictions of the foreign exchange market if you are to make better decisions. These markets showcase trends and potential outcomes, and you must be able to make sense of all these. Ignoring the trends will not land you anywhere, and it is time you start paying attention to them.

Do Not Be Overwhelmed by Emotions:

There is no place for emotions when you want to make it big in the forex market. You need to leave them at the door before entering this volatile space. Losses should not break you, and profits should not get to your head. You must not let your emotions run amok and try to stable while you are trading. Do not opt for ‘revenge trading’. This sort of trading rarely bodes well. Understand that it is okay if you lose. Everyone loses at some point. There is no need to be too harsh on yourself. Sit back, relax and start over.

Forex Market

Finally, Be Aware of Your Limits:

Everyone runs on a budget constraint, and as a beginner, you must too. Always fix up on a budget before you start trading. This will pay you well in the long run. Foreign exchange trading is a bit of a gamble, where you cannot always predict the outcomes appropriately. You must be willing to take some calculated risks. However, there are ways to minimize and calibrate the risks. Set your limits and stop trading when you find that it is becoming difficult too much to handle. Understand your constraints and trade accordingly.

Foreign Exchange
Forex
June 12, 2020

Forex versus Stocks- Which is a Better Investment Option?

The most commonly used form of investment is that of cash. It is safe, securely regulated, and the returns are incredibly lucrative. People, who have just got a job and want to invest, usually opt for cash investments given that they are quite easy to understand and involve very little complications. However, it must be noted that cash is not the only way to go about investments. There are several other alternative ways too. These might be volatile and impregnated with risks, but the returns are also significant. One topic that is always up for debate when we speak of investment is that of forex and stocks. People are often confused about what they must invest in or opt for. Some prefer forex trading, while others prefer stocks.

Speaking of which, we have gathered a few facts and points for you to look into if you have found yourself in a dilemma about the same. These points might shed some light on the topic and help you take a step in the right direction.

Investment

Points to Consider to Make a Quick Decision:

There is no blueprint to investment. Every person has unique risk tolerance and budget constraints, and it is essential to gauge all these factors before opting for any one choice. There are a few things that you must consider before investing in either forex or stocks.

  • Check and analyze your tolerance for risks.
  • Read into the situation of the market, the trading hours and the volatility.
  • Also, recognize and acknowledge your constraint, as we mentioned before, so that you know which type of investment works the best for you.

When are Stocks a Practical Choice?

Now that we have laid out a few basic points before you about the things that you must consider while investing, let us look into what makes stocks a good option. You might want to avoid investing in stocks if you are not available during the market hours to manage your trades. However, if you have the time, want to buy and hold stocks, and also earn long-term dividends, it is essential that you invest in stocks. It might just pay you really well.

When Must You Invest in Forex?

The second thing to understand is that forex trading is not for everyone. Though it is quite easy to enter the space, navigating the risks might not be everyone’s cup of tea. If you have the tolerance for taking up risks, and have a cushion to absorb the shock of losses, forex trading can pay you well. You need to be extremely patient, and understand the pulse of the market to be able to ace forex trading.

Conclusion:

As can be seen from the discussion, it is up to you to choose the asset where you want to invest. There are a number of factors on which you must base your choice. We have discussed them at length in this article, and it must do you well to go through them before making a choice.

Stocks