Wednesday, November 4, 2009


FXCM aims to provide clients with the best pricing available and to get all orders filled at the requested rate. However, there are times when, due to an increase in volatility or volume, orders may be subject to slippage. This most commonly occurs during fundamental news events.

The volatility in the market may create conditions where orders are difficult to execute, since the price might be many pips away due to the extreme market movement. Although the trader is looking to execute at a certain price, the market may have moved significantly and the order would be filled at the next best price or the fair market value. Similarly, increased volume may also result in slippage if sufficient liquidity does not exist to execute all trades at the requested rate.

The concept of slippage is not unique to the forex market, as it often occurs in the equities and futures markets. It is important to note that the "At Market Points" feature on FXCM's FX Trading Station allows traders to control the amount of potential slippage they are willing to accept on a market order. Zero indicates no slippage is permitted. When zero is selected, the trader is telling FXCM his order may be executed only at the exact price requested, or not executed at all. If the trader elects to accept a range of permissible slippage to raise the probability of having his order executed, the order will be filled at the best price available within the specified range. For instance, a client may indicate that he is willing to be filled within 2 pips of his requested order. The system would then fill the client within the acceptable range (in this instance, 2 pips) if the market has moved quickly through the price at which the order was entered. If the order cannot be filled within that permissible range, the order will be rejected.

Once a stop is triggered, it becomes an At Best market order, and there is no guarantee it will be filled at any particular given price. Therefore, stop orders may incur slippage depending on market conditions.

FXCM has obtained close banking relationships with some of the world's largest and most aggressive price providers. Having multiple price providers is especially important in volatile markets, when one or two banks may post wide spreads, or simply avoid quoting any price at all. With so many major banks quoting prices to FXCM, there are competitive spreads and fills, even during market-moving news events.



Under Article VIII of the Agreement members are required to furnish the Fund such information as it deems necessary for its activities, including national data about their economic and financial condition. Article VIII also dates that the Fund shall act as a center for the collection and exchange of information on monetary and financial problems, thus facilitating the preparation of studies designed to assist members in developing policies which further the purposes of the Fund. The Fund uses these statistics, in consultation with the member, as part of the fulfillment of the Fund's regulatory function, to assess the member's quota, and as part of the Fund's role in assessing the world economic outlook. In addition, the Fund has developed standards for the classification and presentation of balance of payments statistics and government finance statistics. It is concerned with maintaining the accuracy and consistency in the reporting of the data. The IMF compiles and publishes these statistics in a variety of publications.


To better help it achieve its overall goal of promoting a stable international monetary system, the IMF's format has changed dramatically since it was created in 1945. Designed initially to provide short-term balance of payments (BOP) lending and monitor member countries' macroeconomic policies, the IMF has steadily incorporated microeconomic factors such as institutional and structural reforms into its activities. These had been seen previously as the exclusive province of the World Bank and other development agencies. The IMF found that, in order to pursue its core responsibilities in the changed world economy, it needed to pay greater attention to second generation reforms, as economists call these sorts of issues.


IMF member countries agreed on a quota increase in 1997. The U.S. Congress subsequently appropriated additional funding for the IMF in October 1998 in the midst of the Asian financial crises, a decision that engendered considerable debate in light of growing criticism of the IMF and its lending practices. In 2002, the IMF did not request any additional increase in funding. Although appropriations of new funds for the IMF is not pending, Congress exercises oversight authority over U.S. policy at the IMF and over its lending practices. This report supports congressional oversight of the IMF by providing an understanding of its organization, functions, and role in the world economy. This report will be updated only if major events and new developments require.


Ones again ZOMBI brings information about IMF function for his sweet visitors. Read and enjoy. IMF main function is to purchase and sell the member countries currencies.
If any country is facing adverse balance of payment and facing the difficulty to get the currency of creditor country, it can get short term credit from the fund to clear the debit.
The IMF allows the debtor country to purchase foreign currency in exchange for its own currency up to 75% of its quota plus an addition 25% each year. The maximum limit of the quota is 200% in special circumstances.
If the demand of any particular country currency increases and its stock with the fund falls below 75% of its quota, the IMF can declare it scare. But IMF also tries to increase its supply by these methods.
IMF purchases the Scare currency by gold.
IMF borrows from those countries scare currency that has surplus amount.
IIMF allows the debtor countries to impose restrictions on the imports of creditor country.
IMF is very useful to avoid the competitive depreciation which took place before World war-II.
When the devaluation policy is indispensable for any country then IMF provides loan to correct the balance of payment of that country. These are the main functions of International Monetary Fund.

Tuesday, November 3, 2009


SMART ZOMBI again wants to share some important matter with his visitors. foreign exchange option (commonly shortened to just FX option or currency option) is a derivative financial instrument where the owner has the right but not the obligation to exchange money denominated in one currency into another currency at a pre-agreed exchange rate on a specified date. The FX options market is the deepest, largest and most liquid market for options of any kind in the world. Most of the FX option volume is traded OTC and is lightly regulated, but a fraction is traded on exchanges like the International Securities Exchange, Philadelphia Stock Exchange, or the Chicago Mercantile Exchange for options on futures contracts. The global market for exchange-traded currency options was notionally valued by the Bank for International Settlements at $158,300 billion in 2005.


SMART ZOMBI wants to share information with his visitors. Foreign exchange reserves (also called Forex reserves) in a strict sense are only the foreign currency deposits and bonds held by central banks and monetary authorities. However, the term in popular usage commonly includes foreign exchange and gold, SDRs and IMF reserve positions. This broader figure is more readily available, but it is more accurately termed official international reserves or international reserves. These are assets of the central bank held in different reserve currencies, mostly the US dollar, and to a lesser extent the euro, the UK pound, and the Japanese yen, and used to back its liabilities, e.g. the local currency issued, and the various bank reserves deposited with the central bank, by the government or financial institutions.


SMART ZOMBI wants his visitors, his sweet visitors to read the main fact about IMF MISSION.
The basic mission of the IMF is to provide financial assistance to countries that experience serious financial and economic difficulties using funds deposited with the IMF from the institution's 186 member countries. Member states with balance of payments problems, which often arise from these difficulties, may request loans to help fill gaps between what countries earn and/or are able to borrow from other official lenders and what countries must spend to operate, including to cover the cost of importing basic goods and services. In return, countries are usually required to launch certain reforms, which have often been dubbed the "Washington Consensus". These reforms are thought to be beneficial to countries with fixed exchange rate policies that may engage in fiscal, monetary, and political practices which may lead to the crisis itself. For example, nations with severe budget deficits, rampant inflation, strict price controls, or significantly over-valued or under-valued currencies run the risk of facing balance of payment crises. Thus, the structural adjustment programs are at least ostensibly intended to ensure that the IMF is actually helping to prevent financial crises rather than merely funding financial recklessness.

Monday, November 2, 2009


The IMF's influence in the global economy steadily increased as it accumulated more members. The number of IMF member countries has more than quadrupled from the 44 states involved in its establishment, reflecting in particular the attainment of political independence by many developing countries and more recently the collapse of the Soviet bloc. The expansion of the IMF's membership, together with the changes in the world economy, have required the IMF to adapt in a variety of ways to continue serving its purposes effectively. In 2008, faced with a shortfall in revenue, the International Monetary Fund's executive board agreed to sell part of the IMF's gold reserves. On April 27, 2008, IMF Managing Director Dominique Strauss-Kahn welcomed the board's decision April 7, 2008 to propose a new framework for the fund, designed to close a projected $400 million budget deficit over the next few years. The budget proposal includes sharp spending cuts of $100 million until 2011 that will include up to 380 staff dismissals.
At the 2009 G-20 London summit, it was decided that the IMF would require additional financial resources to meet prospective needs of its member countries during the ongoing global crisis. As part of that decision, the G-20 leaders pledged to increase the IMF's supplemental cash tenfold to $500 billion, and to allocate to member countries another $250 billion via Special Drawing Rights.

Wednesday, October 28, 2009


ZOMBI here collected information for a new or old traders of FOREX market.
There are many sites which offers trading. Including this ICM also offers.
ICM offers it's clients a choice of leading edge trading platforms - WinTrader and MetaTrader 4. These platforms support a broad array of trading products for both desktop and mobile trading. ICM treats the issues of data security, privacy, integrity and backup with the utmost attention and care. Our system security is applied at two levels: one at the server level and one at the application level. Moreover, each platform has redundancy and backup and recovery capability to ensure your transactions and intact and secure.

Why trade with ICM?

ICM provides some unique and exceptional advantages for online traders:

2 pip fixed spreads,
WinTrader and MetaTrader software,
400:1 leverage, 0.25% margin requirements,
Licensed Broker,
API/Expert Advisor automated trading,
Guaranteed fills,
Currencies, indices and commodities,
Fast and easy account opening.

Source( icm trading.)


Thursday, October 22, 2009


ZOMBI brings for his visitors the great information. A arranged  FOREX account is an established live FOREX account funded by the investor, and traded by a company or professional. This allows the investor a reasonable rate of return on an account he does not necessarily have to trade himself, and the opportunity to be a part of the largest market in the world. There are literally hundreds of companies and investment firms that make use of an investor's money by establishing a managed FOREX account. Some of these companies and firms specialize in managed FOREX accounts, and spend all of their time and effort strictly in the currency exchange. This gives the investor confidence their managed FOREX account is being traded by a professional currency investor, and gives them a better chance of a steady monthly (or yearly) percentage of return. The returns on a managed FOREX account have been advertised anywhere from 5% to 20%+ monthly, with a 10% to 40% of the profit as a monthly (or yearly) fee to the company or firm. Alternatively, many companies and professionals may take management fees on the managed FOREX account even if the account is not in profit for the month. There are obviously many up sides to a managed FOREX account. The investor is able to achieve a steady rate of growth without having to spend all the necessary time and effort to trade the money himself. The investing firm or company that provides the managed FOREX account will take a small portion of the profit for the month or year, still assuring that the account is at steady growth. The FOREX market is a very liquid market as well, giving the investor a much more flexible means of withdrawing funds from the managed FOREX account. Also, trading currency allows profit potential in both rising and falling markets, giving the experienced money manager more opportunities to grow the investor's account. Two of the major types of managed FOREX accounts are those traded manually, and those traded by an automated "trading bot". Trading bots are pieces of software that automatically trade currency based on a hard coded set of rules. A coder will write the system and money management rules into a variety of programming languages to produce software that could provide a more regulated steady rate of return for the managed FOREX account than the manual trader. This gives the ability of the company or professional to advertise a set rate of monthly (or yearly) growth. Some of the more traditional companies and individuals alike prefer to have their funds traded manually, as the human interaction aspect can sometimes yield smaller draw downs and larger returns. As a managed FOREX account seems like a very lucrative direction to take in the FOREX market, some people may still be drawn away from it for a few select reasons. Usually, many commercial brokers and investment firms have a minimum for the account to be traded. These minimums are usually around $10,000, and prove a hefty starting cost to the average trader.


Foreign Exchange (FOREX), where nation's currency is exchanged with each other. The foreign exchange market is the largest financial market in the world, with the equivalent of over $1.9 trillion changing hands daily; more than three times the aggregate amount of the US Equity and Treasury markets combined. Unlike other financial markets, This market has no physical existence and no central exchange (off-exchange). It operates through a global network of banks, corporations and individuals trading one currency for another. The lack of a physical exchange enables the Forex market to operate on a 24-hour basis, spanning from one zone to another in all the major financial centers.


1. It never closes. It's open around the clock, worldwide. Trading positions open at Monday 7am, New Zealand time and close 5pm New York time on Friday. During this time, you can enter or exit the market whenever you like. It's a continuous electronic currency exchange. This is great because you can trade whenever you have spare time.

2. Leverage. Standard $100 000 currency lots can be traded with as little as $1000. This is mainly because of the ease with which you can buy and sell, some brokers will leverage up to 200 times, so with $100 you can control a 200 000 unit currency position. It's the best use of trading capital around, even banks lending on property investments don't come close.

3. Accurately predict the outcomes. Currency prices generally repeat themselves in predictable cycles so you can see what the trends are. 'Technical Analysis' helps to see these trends and profit from them.

4. Low Transaction Cost. In other words, you mistakes won't cost you a fortune. Good brokers won' charge commissions to trade or maintain an account even if you have a mini account and trade small volumes.

5. Unlimited Earning Potential. has a daily trading volume of over 1.5 trillion, the largest financial market in the world. It dwarfs the equities market (50 billion daily) and the futures market (30 billion).

6. You can make money in any market conditions. Each market is one currency against another, so when you buy in one, you're selling in another so there's no biase towards either currency moving up or down. This means it's up to you to choose which currency to buy or sell with. Yu can make money going up or down.

7. Market transparency. This is an advantage in any business or trading environment. It means you can manage risk and execute orders within seconds. It's highly efficient and allows you to avoid unexpected 'surprises'.


Most FOREX traders use a broker to handle their transactions. What exactly is a broker? Strictly speaking, a broker is an individual or a company that buys and sells orders according the investor's decisions. Brokers earn money by charging a commission or a fee for their services.

A FOREX broker needs to be associated with a large financial institution such as a bank in order to provide the funds necessary for margin trading. In the United States a broker should be registered as a Futures Commission Merchant (FCM) with the Commodity Futures Trading Commission (CFTC) as protection against fraud and abusive trade practices.
Before trading FOREX you need to set up an account with a FOREX broker. You may feel overwhelmed by the number of brokers who offer their services online. Deciding on a broker requires a little bit of research on your part, but the time spent will give you insight into the services that are available and fees charged by various brokers.


If you want to become a good trader then you must observe the following article,
Once you have decided to enter the Forex trading world you will find that FX trading has many advantages over other capital markets. Including among others; very low margins, free trading platforms, high leverage and around-the-clock trading.
It is my main concern in this article to let you know what hours you should be ready and focus for start trading, so you can expect the highest profits in your trades, and not just consider that around-the-clock trading means you should randomly trade through out the day.
In short, it is important to know what the best hours to trade are because if you want to find an appreciable number of profitable trades you need to enter the forex market at the best period of time, i.e., when the activity, the volume of transactions, is the highest.
At any given time; somebody, somewhere in the world is buying and selling currencies. As one market closes, another market opens. Business hours overlap, and the exchange continues as day becomes night and night becomes day. Giving you 5.5 entire potential trading days.
Forex Trading begins in New Zealand at Sunday 5pm EST, and then is followed by Australia, Asia, the Middle East, Europe, and America in this order and through out the day and through out the week until Friday 4pm EST when the American market closes.
Other important facts every Forex trader should know are: the US & UK markets account for more than 50% of the forex market transactions; Forex major markets are: London, New York and Tokyo. Nearly two-thirds of NY activity occurs in the morning hours while European markets are open. And maybe one of the most important characteristics; Forex Trading activity is heaviest when major markets overlap.

So, the answer to the question; "What hours should I be trading?" is dictated by this last characteristic, you should trade when the major markets overlap. Now, when do they overlap?.
Considering the different time zones of the world and open and close times for Australian, New Zealand, Japan, America and Europe markets. We can arrive to the conclusion that there are two major time gaps when two of the major markets overlap during trading hours.
These hours are between 2 am and 4 am EST (Asian/European) and between 8 am to 12 pm EST(European/N. American).


Wednesday, October 14, 2009


When you have read about money that what money is and what are its operation. now come to its trading as currency trading. More and more people are taking hold of their finances and investing in market by themselves. This can be confusing, especially when you do not have any knowledge of online Foreign Currency Trading before. However, investing online Foreign Currency Trading on your own can hold various advantages:

The Foreign Currency Trading market doesn't have as strict country regulations as other markets do. So when investing all of your money if concentrated and saved instead of being wasted in commissions and taxes.
Because the Foreign Currency Trading market is not centralized and is run all over the world, there is no particular side cornering the market. The fraud options that are common to other trading options rarely exist in Foreign Currency Trading.
With the online Foreign Currency Trading market you can have 24 hour updates of your investment in currency from the convenience of your own home.
Foreign Currency Trading market is the only market that has no exchange fees, commissions and payments of that sort. This makes it profitable for you also because there is no middleman between your investment and the market.
The Foreign Currency Trading market is high in liquidity, meaning you can invest a small or large amount of money in, and sell it whenever you decide.


ZOMBI here shares you about the operation of money. There have been many historical disputes regarding the combination of money's functions, some arguing that they need more separation and that a single unit is insufficient to deal with them all. One of these arguments is that the role of money as a medium of exchange is in conflict with its role as a store of value: its role as a store of value requires holding it without spending, whereas its role as a medium of exchange requires it to circulate. Others argue that storing of value is just deferral of the exchange, but does not diminish the fact that money is a medium of exchange that can be transported both across space and time. The term 'financial capital' is a more general and inclusive term for all liquid instruments, whether or not they are a uniformly recognized tender.

In the past, money was generally considered to have the following four main functions, which are summed up in a rhyme found in older economics textbooks: "Money is a matter of functions four, a medium, a measure, a standard, a store." That is, money functions as a medium of exchange, a unit of account, a standard of deferred payment, and a store of value. However, most modern textbooks now list only three functions, that of medium of exchange, unit of account, and store of value, not considering a standard of deferred payment as a distinguished function, but rather subsuming it in the others.

                     When money is used to intermediate the exchange of goods and services, it is performing a function as a medium of exchange. It thereby avoids the inefficiencies of a barter system, such as the 'double coincidence of wants' problem.


A unit of account is a standard numerical unit of measurement of the market value of goods, services, and other transactions. Also known as a "measure" or "standard" of relative worth and deferred payment, a unit of account is a necessary prerequisite for the formulation of commercial agreements that involve debt. To function as a 'unit of account', whatever is being used as money must be:

1. Divisible into smaller units without loss of value; precious metals can be coined from bars, or melted down into bars again.

2. Fungible: that is, one unit or piece must be perceived as equivalent to any other, which is why diamonds, works of art or real estate are not suitable as money.

3. A specific weight, or measure, or size to be verifiably countable. For instance, coins are often made with ridges around the edges, so that any removal of material from the coin (lowering its commodity value) will be easy to detect.

          To act as a store of value, a commodity, a form of money, or financial capital must be able to be reliably saved, stored, and retrieved — and be predictably useful when it is so retrieved. Fiat currency like paper or electronic money no longer backed by gold in most countries is not considered by some economists to be a store of value.

              While standard of deferred payment is distinguished by some texts, particularly older ones, other texts subsume this under other functions. A "standard of deferred payment" is an accepted way to settle a debt – a unit in which debts are denominated, and the status of money as legal tender, in those jurisdictions which have this concept, states that it may function for the discharge of debts. When debts are denominated in money, the real value of debts may change due to inflation and deflation, and for sovereign and international debts via debasement and devaluation. 

(source : wikipedia). 


ZOMBI here bring the information for his most precious visitors to make them understand about the international system of money. Money originated as commodity money, but nearly all contemporary money systems at the national level are fiat money systems. Fiat money is without value as a physical commodity, and derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the national boundaries of the country, for "all debts, public and private". By law, the refusal of a legal tender (offering) extinguishes the debt in the same way acceptance does. Some bullion coins such as the Australian Gold Nugget and American Eagle are legal tender, however, they trade based on the market price of the metal content as a commodity, rather than their legal tender face value (which is usually only a small fraction of their bullion value)


As we know that money is everything and without money a person is nothing. He can neither survive nor can help anyone. So now the question is what mney is? I "ZOMBI" tell you about the money that Money is anything that is generally accepted as payment for goods and services and repayment of debts.The main functions of money are distinguished as: a medium of exchange, a unit of account, a store of value, and occasionally, a standard of deferred payment.Money is an abstraction, idea or concept, token instances of which are the physical bills or coins which are carried and traded.

Tuesday, October 13, 2009


Having the right combination of information can definitely lead you places and will see your investment portfolio grow like you have never seen it grow before this article. Adhere to these tips and you can be guaranteed of a money making success in the Forex market in time to come.
There is no need for advertisements when it comes to the Forex market. Just by worth of the market itself, comprising of a turnover of more than 5 trillion dollars a day should give you a pretty good picture just how big the potential pie is and how much opportunity there is out there for you to make some really good money. But is essential for potential trader to understand fully the market if they are really serious about making money in the paper trade.
More than 90% of the new investor movements into the market are not able to sustain their presence and soon lose their initial margins – and often do not come back. You need to be part of that 10% that manage to fight through the volatile market, make the right money making decisions and get the best Forex picks.

1. The best tip for Forex investors is to pick a currency pair that they are most comfortable with and do not choose exotic currencies from countries where they barely have any idea about the market conditions or financial trading rules that rule them. You might just be blind-sided by some archaic banking rules that circle some of these exotic currencies, so choose the popular currencies that are being traded and choose a pair that you know you can get comfortable with and you can study over time. Also, the next thing you need to know about is how to combine technical and fundamental analysis together to be effective in your trading.

2. Technical analysis is very technical, there is a whole host of charts, bars, diagrams, candlesticks diagrams and jargon you need to be familiar with; but this is important.

3. Fundamental analysis shows you where the market might be going based on external information like political situations and economic weather in the global market, so you need to combine three things. Study where the market has been, use technical analysis to see what is going on in the market and fundamental analysis to ascertain where it might be headed in the near future.

There are many more money making secrets from Forex market out there but these are just some of the best tips that you can use to make the best Forex picks for yourself. One you have secured these 3 things, you are ready to proceed on the right track and make the right decisions, just in time to reap your profitable pips.

Saturday, October 3, 2009


If you want to be succeeded in the life then you must stay away from some activity.

Before actually participating in any FOREX trade, make sure you have done your homework. Do the research and jot down all the necessary details about the trading transaction that you wish to perform. Ever heard of inter-bank market? Stay away from companies which lure you into trading in the inter-bank market because the currency transactions are negotiated in a wobbly network of large companies and financial institutions.

Also, make sure to check the background or history of the trading company. If a certain company does not disclose information about their background, that should serve as a red flag. It means that you should continue doing transactions with them. Nor is it advisable to transfer/send cash through the mail or the internet. Practice caution in everything you do, and you’ll be more than sure that you are always safe.

Fraudulent companies often solicit services and advertise soaring pressure tactics to attract you in participating or joining their services. An offshore company which guarantees no risk and return of profit is a big NO. Always be skeptical and don’t give in to any instant offer that comes your way.


For the new traders the important elements are to be considered most important tips and methods to trade. Because in FOREX you may be cheated.
The success of FOREX trading, like any other trading, lies in your ability to buy for less and sell for more. You can trade in FOREX market successfully if you keep patience and a little diligence. You can also safeguard yourself from FOREX trading frauds if you stay alert and skeptical.
Take a carefully evaluated decision about your trading company or transaction. These pieces of advice are merely to guide you. Ultimately, it will entirely depend on you to identify and reject offers from fraud companies. One wrong decision could seriously jeopardize you trading career, so act wisely.

Are you one of those who have heard about FOREX trading but not sure what it really is? Or you would like to find FOREX trading tips on how it works and if you can make money out of it, but not sure whom to ask? Well, I can tell you are not alone in this situation. Many people think that they are familiar with FOREX trading, but in reality, most of them think that forex trading has something to do with stocks or bonds.

The opportunities that FOREX trading provides for different individuals, firms, and organizations is growing rapidly every year. And accompanying this growth is the widespread growth of different scams related with FOREX trading. But you should not worry because there are a lot of legitimate companies or firms that can help you in forex trading.

The best thing to do is to find these legitimate companies to stay away from fraudulent ones. However, most new traders fall prey to these scammers because of their savory offers.

Don’t get fooled by the companies that advertise high profits for minimal risks. The fact is that, if you want to earn high profits, then you are likely subjected to high risks as well. Higher rate of profit means higher risk.

So, always stay on the safer side. If you’re looking for a FOREX trading broker, and since each broker is part of a certain company, make sure that you select a government registered company. In signing any contract with them, double check if they are registered or certified brokers. This is one basic precaution that will prevent any misfortune that you might encounter in the future.


The new traders normally don't have much information about FOREX trading. They normally get loss. The important tips of FOREX should be considered first to start trading.
Did you know that the FOREXMarket is like fire? Because, if you do not know how to nourish or control fire, it takes over you and does some damage that can scar for for a very long time. But if you know where to direct it, place it, control its intensity and quantity, then fire is not a damaging element anymore, but useful. Evolution and time has taught man to control fire.
Same as in FOREX, if you do not know how to make FOREX work for you, your loss can be heartbraking and traumatizing. FOREX Traders fail in FOREX, but not because it was just too risky, if you dig down deep, they tend to use a trade method that doesn’t work, for them. Remember that no matter how “effective” a trade method is, it won’t work unless it works for you. There are manyFOREX trader success stories, using the method that works for them.
The FOREX Market is one of the great places to produce tremendous wealth, even in an recent economy of uncertainty. Better than Stocks and Futures Markets combined, FOREX has opened its doors to individuals that want to have wealth sooner than they thought, and even larger than they ever dreamed of, and yes, that is you and me. In a such situation of the economy, companies turn their heads on FOREX for additional income.

Wednesday, September 30, 2009


If you want to take part in the FOREX trading then you must know about it.
The foreign exchange market or forex market as it is often called is the market in which currencies are traded. Currency Trading is the world's largest market consisting of almost $3.5 trillion in daily volume. All trades that take place in the foreign exchange market involve the buying of one currency and the selling of another currency simultaneously. This is because the value of one currency is determined by its comparison to another currency. The first currency of a currency pair is called the "base currency," while the second currency is called the “counter currency.” The currency pair shows how much of the counter currency is needed to purchase one unit of the base currency. Currency pairs can be thought of as a single unit that can be bought or sold. When purchasing a currency pair, the base currency is being bought, while the counter currency is being sold. The opposite is true, when the sale of a currency pair takes place. There are four major currency pairs that are traded most often in the foreign exchange market. These include the EUR/USD, USD/JPY, GBP/USD, and USD/CHF.


Markets are interrelated, and a problem in one market can have its source in a different market. This finding is a starting point for macroeconomics. To limit the number of markets they must explore, economists conventionally lump together or aggregate the vast number of markets in a modern economy into only four:
1. markets for goods and services,
2. financial assets,
3. money balances,
4. resources.

The foreign exchange market provides an excellent illustration of how financial markets can transmit disturbances. The market is usually considered to be an efficient market, not subject to runaway speculative binges. The heart of the market is the trading by a number of very large banks. A trade worth a million dollars is very small in this market, but it is the prices of these very large bank transactions that newspapers report when they publish exchange rates. When you deal in smaller amounts when you travel to Thailand, you will get less favorable prices.

Tuesday, September 29, 2009


Wow the good market and the best ever. Foreign exchange market is one of the best market in the world. It has its own beauty to be oneness. It is amazing and different from other markets because of its incomparable facts like,

1. It's huge trading aggregate,
2. It's geological scattering,
3. It is the supreme liquidity market,
4. It is 24 hours trading market except on these days (from 22:00 UTC on Sunday until 22:00 UTC Friday),
5. The exchange rates get changed due to its multiple factors,
6. The use of leverage.

(Source: wikipedia.)


The market for foreign exchange can be analyzed in terms of supply and demand. Americans demand foreign money (and supply dollars) when they buy things abroad, such as vacations, goods, services, factories, and financial assets. Foreigners supply foreign currency (and demand dollars) when they buy things here, such as vacations, goods, services, factories, and financial assets. Although when you buy a Japanese camera, you do not deal in the foreign exchange market, someone did in the process of bringing the camera to you. It may have been the American importer, who would have sold dollars to buy yen, and then used the yen to buy the camera. Or it may have been the Japanese exporter, who sold cameras for dollars and then sold the dollars for yen. In either case, dollars were supplied to the foreign exchange market and yen were demanded.


Everyone knows that the national currency of any country is only useful in its boundary. But when we have to do business out side the country then the native currency becomes useless. At this stage we need the currency of that country with which we are doing trade.

In the market for foreign exchange (forex), people trade one country's money for another's. If, for example, you decide to travel to Thailand, you will need to buy some bahts, the currency of Thailand, either before you go or once you get there. In your transaction, you will supply dollars to the foreign exchange market and demand bahts.

Monday, September 28, 2009


If you think of the markets as a big clock, fundamentals are the gears and springs that move the hands around the face. Anyone can tell you what time it is now, but the fundamentalist knows about the inner workings that move the clock's hands towards times (or prices) in the future.

Fundamental analysis of a business involves analyzing its financial statements and health, its management and competitive advantages, and its competitors and markets. When applied to futures and forex, it focuses on the overall state of the economy, interest rates, production, earnings, and management. When analyzing a stock, futures contract, or currency using fundamental analysis there are two basic approaches one can use; bottom up analysis and top down analysis. The term is used to distinguish such analysis from other types of investment analysis, such as quantitative analysis and technical analysis. Fundamental analysis is performed on historical and present data, but with the goal of making financial forecasts.
There are several possible objectives like,

1. To conduct a company stock valuation and predict its probable price evolution.
2. To make a projection on its business performance.
3. To evaluate its management and make internal business decisions.
4. To calculate its credit risk.


Technical analysis attempts to forecast future price movements by examining past market data.

The principles of technical analysis derive from the observation of financial markets over hundreds of years. The oldest known example of technical analysis was a method developed by Homma Munehisa during early 18th century which evolved into the use of candlestick techniques, and is today a main charting tool

Technical analysis is a security analysis discipline for forecasting the future direction of prices through the study of past market data, primarily price and volume.In its purest form, technical analysis considers only the actual price and volume behavior of the market or instrument. Technical analysts may employ models and trading rules based on price and volume transformations, such as the relative strength index, moving averages, regressions, inter-market and intra-market price correlations, cycles or, classically, through recognition of chart patterns.

Technical analysts seek to identify price patterns and trends in financial markets and attempt to exploit those patterns. While technicians use various methods and tools, the study of price charts is primary.


I f you are a beginner in FOREX trading, this is the place to start. The following articles will help you gain an understanding of the FOREX market and how it works.


FOREX trading is typically done through a broker or market maker. As a FOREX trader you can choose a currency pair that you feel is going to change in value and place a trade accordingly. For example, if you had purchased 1,000 Euros in January of 2005, it would have cost you around $1,200 USD. Throughout 2005 the Euro’s value vs. the U.S. Dollar’s value increased. At the end of the year 1,000 Euros was worth $1,300 U.S. Dollars. If you had chosen to close your trade at that point, you would have made $10


FOREX trades can be placed through a broker or market maker. Orders can be placed with just a few clicks and the broker then passes the order along to a partner in the Interbank M

arket to fill your position. When you close your trade, the broker closes the position on the Interbank Market and credits your account with the loss or gain. This can all happen literally within a few seconds.


There are m

any countries in world; so results different currency pairs. Among all of them, these are the popular in currency trading:


Five Majo

r Currencies are:

U.S dollar - The United States dollar is the world's main currency – an universal measure to evaluate any other currency traded on FOREX.

Euro- Euro was designed to become the premier currency in trading by simply being quoted in American terms. Like the U.S. dollar, the euro has a strong international presence stemming from members of the European Monetary Union.

Japanese Yen- The Japanese yen is the third most traded currency in the world; it has a much smaller international presence than the U.S. dollar or the euro. The yen is very liquid around the world, practic

ally around the clock.

British Pound - Until the end of World War II, the pound was the currency of referen

ce. The currency is heavily traded against the euro and the U.S. dollar, but has a spotty presence against other currencies.After the introduction of the euro, Bank of England is attempting to bring the high

U.K. rates closer to the lower rates in the euro zone.

Swiss Franc - Swiss franc is the only currency of a major European country that belongs neither to the European Monetary Union nor to the G-7 countries. Although the Swiss economy is relatively small, the Swiss franc is one of the four major currencies, closely resembling the strength and quality of the Swiss economy and finance.

To have a well focusing, you have to concentrate on less than 5 currency pairs( prefer

red the U.S. cross-currency pairs.)

Some traders

see FOREX as a business, and some see it as a fortune. And even some traders think forex is an art. But anyway, its highly recommended to use pivot system in your trading plan or else you are trading blind.

(ii) Forex Quotes

Reading a foreign exchange quote is simple if you remember two things:

  1. The first currency listed is the base currency
  2. The value of the base currency is always 1.
As the centerpiece of the FOREX market, the US dollar is usually considered the base currency for quotes. When the base currency is USD, think of the quote as telling you what a US dollar is worth in that other currency.

When USD is the base currency and the quote goes up, that means USD has strengthened in value and the other currency has weakened. Rising quotes mean a US dollar can now buy more of the other currency than before.

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(iv) Leverage & Margin

Leverage trading, or trading on margin, means you aren't required to put up the full value of the position.

Forex trading offers more leverage than stocks or futures - up to 200 times the value of your account. Of course keep in mind that increased leverage also increases your risk.

(v) Swap Rates

Another important component to remember when trading forex is the SWAP (Also known as rollover) rates. As mentioned before when trading a currency pair you are borrowing the bottom pair and purchasing and holding the top pair. So if you are trading the GBP/JPY you are actually purchasing the GBP and borrowing the Yen.

As you know, when holding a currency in an account you are receiving interest and when borrowing a currency you are paying interest. Because forex trading is highly leveraged and you are theoretically controlling large amounts of money, the SWAP rates accumulate and need to be accounted for in your trading. Typically forex dealers either pay or charge you the SWAP rate depending on the position you are holding.

Let's look at the GBP/JPY example. When taking a position in the GBP/JPY you are borrowing the Japanese Yen at a low interest rate and using it to purchase the Sterling which pays a higher interest; so when you are long this pair you will receive daily interest from your forex dealer and when you are short you will be paying daily interest. The forex dealer will always charge a little more than they pay when it comes to rollover rates in exchange for facilitating the process

(source: Taken from ,