InvestMacro FX

By GCI Forex Research

Fundamental Outlook at 0800 GMT (EDT + 0500)

€

The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3125 level and was capped around the $1.3185 level.  Technically, today’s intraday low was right around the 38.2% retracement of the $1.5140 – 1.1875 range.  Australasian dealers pushed the common currency lower overnight on a report the European Central Bank has “serious concerns” about proposed Irish legislation regarding the country’s banking system.  There is speculation the new law, if passed, would inhibit the ECB’s ability to execute its liquidity operations.  The common currency was also pressured lower on a report that troubled Irish banking giant Allied Irish Banks may be nationalized.  Traders also pushed the common currency lower in anticipation of U.S. economic data that are due to be released this week will evidence a U.S. economy that is expanding more-than-expected.  Q3 gross domestic product data will be released on Wednesday and many economists expect the preliminary +2.5% y/y estimate will be upwardly-revised.  Liquidity will likely be lighter-than-normal this week on account of the Christmas holiday.  Data to be released during the North American session today include the November Chicago Fed national activity index.  In eurozone news, Eurogroup chairman Juncker this weekend reported the European Union “in January will have to tackle the question whether the funds that have been gathered to tackle the overall consequences of the crisis in case other countries will get in such a situation – which I don’t see happening but which I can’t exclude either – need to be increased.”  Juncker also reported the euro “isn’t in a crisis” and is “astonishingly stable…We’re facing a debt crisis in individual euro area countries.  The euro’s existence isn’t at risk.”  ECB President Trichet said the euro’s dissolution is an “absurd hypothesis.”  Ongoing eurozone sovereign credit jitters are also weighing heavily on the common currency.  Data released in the eurozone today saw the October EMU-16 current account improve to -€2.3 billion from the revised prior reading of -€8.5 billion.  Data to be released later during the North American session include December EMU-16 consumer confidence.  Also, German November producer prices moderated to +0.2% m/m and +4.4% y/y.  German data to be released tomorrow include the January GfK consumer confidence survey.  Euro bids are cited around the US$ 1.3075 level.

¥/ CNY

The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥83.75 level and was capped around the ¥84.10 level.  Technically, today’s intraday low was right around the 38.2% retracement of the ¥85.95 – 80.25 range.  Bank of Japan’s Policy Board began its two-day monetary policy deliberations overnight and is largely expected to keep policy unchanged.  Many dealers believe the central bank will keep policy unchanged for the foreseeable future unless the yen resumes its move higher.  BoJ Governor Shirakawa speaks tomorrow after the Policy Board’s decision is announced.  The government, however, is expected to maintain pressure on the central bank to ease policy further.  The central bank is also expected to keep its economic assessment unchanged when its policy decision is released overnight.  Data released in Japan overnight saw the October coincident index tick higher to 100.8 while the October leading index improved to 97.7.  Other data saw November nationwide department store sales reverse course and decline 0.5% y/y and November Tokyo-area department store sales weakened to +0.3% y/y while November convenience store sales improved to +1.1% y/y.  Other data to be released this week include November merchandise trade.  BoJ’s monthly economic report will also be released on Wednesday.  Bank of Japan last week reported Japanese companies accumulated a record amount of cash on their balance sheets last quarter, consistent with this week’s BoJ quarterly Tankan survey that showed a decline in business confidence among large manufacturers.  Traders continue to monitor developments on the Korean peninsula where military tensions remain significantly elevated and North Korea is indicating war if possible if South Korea engages in military drills.  The Nikkei 225 stock index lost 0.85% to close at ¥10,216.41.  U.S. dollar offers are cited around the ¥84.60 level.  The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥110.15 level and was capped around the ¥110.70 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥130.45 level while the Swiss franc moved higher vis-à-vis the yen and tested offers around the ¥86.80 level. In Chinese news, the U.S. dollar appreciated vis-à-vis the Chinese yuan today as the greenback closed at CNY 6.6725 in the over-the-counter market, up from CNY 6.6640.  Speculation mounted that Chinese interest rates will not be raised before the end of the year.  Government researched Ba Shusong was quoted as saying that banks’ reserve requirements and central bank bill sales may be more efficient tools for controlling inflation than interest rate policy because higher rates may attract capital inflows.  Reserve requirements have been raised six times this year.  People’s Bank of China Governor Zhou last week reported global economic turbulence is limiting the central bank’s ability to raise interest rates to counter inflation.  Notably, China’s inflation rate reached a 28-month high in November and PBoC has pledged it will transition to a “prudent” monetary policy stance in 2011.  The central bank this month raised reserve requirements for banks for the third time in five weeks. The lack of an interest rate increase suggests there may be a lack of consensus at the central bank. China is said to be targeting 8% GDP growth and 4% inflation growth in 2011 along with 16% M2 money supply growth.

£

The British pound appreciated vis-à-vis the U.S. dollar today as cable tested bids around the US$ 1.5565 level and was capped around the US$ 1.5475 level.  Technically, today’s intraday high was just above the 23.6% retracement of the $1.5910 – 1.5455 range.  Data to be released in the U.K. tonight include the December GfK consumer confidence survey and data to be released to be released tomorrow include November public sector net borrowing and the November public sector net cash requirement.  Minutes from Bank of England’s December Monetary Policy Committee meeting will be released on Wednesday and are expected to evidence intense debate regarding a possible shift in monetary policy.  The Confederation of British Industry this weekend reported the central bank will likely begin to start raising interest rates within six months to reduce inflation.  BoE released its semi-annual Financial Stability Report last week in which it warned the U.K. is only “partially insulated” from the European financial crisis.  MPC member Posen last week reported policymakers should not “overreact” to inflation while BoE Deputy Governor Bean last week warned “elevated inflation” may persist in the U.K. economy.  Cable bids are cited around the US$ 1.5265 level.  The euro depreciated vis-à-vis the British pound as the single currency tested bids around the £0.8455 level and was capped around the £0.8495 level.

CHF

The Swiss franc appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the CHF 0.9650 level and was capped around the CHF 0.9720 level.  Technically, today’s intraday low was right around the 23.6% retracement of the CHF 1.0275 – 0.9460 range.  Last week, the dollar failed to gain much headway above the CHF 0.9835 level, representing the 38.2% retracement of the CHF 0.9460 – 1.0065 level.  Swiss National Bank member Jordan this weekend reported “There may be situations where interest rates have to be kept at a low level to ensure price stability, and where higher rates could threaten the economy.”  SNB Chairman Hildebrand reported he remains concerned over the eurozone sovereign debt crisis, adding it could lead to “devastating” consequences if the euro depreciates sharply and the franc soars.  Data to be released tomorrow include the November trade balance and November M3 money supply.  The KOF Institute last week raised its Swiss GDP growth forecast slightly for 2011 and reported Swiss National Bank is likely to raise interest rates around the middle of 2011.  Swiss National Bank’s quarterly interest rate announcement was announced last week in which policymakers maintained the central bank’s three-month Swiss franc Libor target rate at 0.25%.  SNB’s 2011 inflation forecast was raised to 0.4% from 0.3% and its 2012 inflation forecast was reduced to 1% from the prior reading of 1.2%.  SNB expects the Swiss economy to grow about 2.5% in 2010 and around 1.5% in 2011.  The Swiss government last week raised its GDP growth forecast for 2011 to 1.5% from the 1.2% projection it noted in September.  U.S. dollar offers are cited around the CHF 1.0180 level.  The euro depreciated vis-à-vis the Swiss franc as the single currency tested bids around the CHF 1.2710 level while the British pound moved lower vis-à-vis the Swiss franc and tested bids around the CHF 1.5000 figure.

Technical Outlook at 1330 GMT (EST + 0500)

(Bid Price) (Today’s Intraday Range)

EUR/ USD      1.3169                1.3186, 1.3124
USD/ JPY        83.79                  84.11,   83.77
GBP/ USD      1.5549                1.5556, 1.5475
USD/ CHF      0.9661                0.9719, 0.9653
AUD/USD       0.9902                0.9907, 0.9860
USD/CAD       1.0122                1.0139, 1.0106
NZD/USD       0.7402                0.7404, 0.7345
EUR/ JPY       110.33                110.70, 110.16
EUR/ GBP      0.8464                0.8494, 0.8457
GBP/ JPY       130.30                130.42, 129.98
CHF/ JPY         86.71                  86.82,   86.47

Support                       Resistance                  Support                    Resistance

EUR/ USD                                                           USD/ JPY

L1.       1.3110                         1.3740                            81.60                          84.60

L2.       1.3030                         1.4220                            79.30                          87.30
L3.       1.2645                         1.4365                            77.20                          89.45

GBP/ USD                                                        USD/ CHF

L1.       1.5740                         1.6275                         0.9775                         0.9965

L2.       1.5610                         1.6390                         0.9505                         1.0065

L3.       1.5465                         1.6510                         0.9310                         1.0180

AUD/ USD                                                        USD/ CAD

L1.       0.9690                         0.9995                         0.9975                         1.0360

L2.       0.9480                         1.0105                         0.9860                         1.0585

L3.       0.9280                         1.0220                         0.9735                         1.0810

NZD/ USD                                                        EUR/ JPY

L1.       0.7650                         0.8000                         111.45                         114.35

L2.       0.7585                         0.8140                         110.35                         115.40

L3.       0.7310                         0.8370                         109.65                         117.40

EUR/ GBP                                                       EUR/ CHF

L1.       0.8375                         0.8590                         1.3330                         1.3650

L2.       0.8260                         0.8890                         1.3205                         1.3720

L3.       0.8140                         0.8995                         1.3005                         1.3895

GBP/ JPY                                                         CHF/ JPY

L1.       130.95                         134.20                           82.95                          85.00

L2.       130.10                         136.70                           81.65                          86.70

L3.       129.20                         138.40                           80.70                          88.00

Forex Daily Market Commentary provided by GCI Financial Ltd.

GCI Financial Ltd (”GCI”) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (”Forex”) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (”CFDs”) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.

DISCLAIMER: GCI’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.

Happy Holiday’s FX friends! Hope your trades are giving you dividends especially these days. Anyway, those who are long on the New Zealand dollar or the Kiwi as what investors call it in the street, should start thinking about lightening your positions. Why? Well, if you look at its daily chart, you will see that it has recently broken down from a head and shoulders pattern. In the process, it has also breached its uptrend line. As some of you might know, a break down from such pattern signals a bearish reversal. So if the NZDUSD pair fails to go over the formation’s neckline at 0.7400, it could fall all the way down to just above 0.6800 (computed by projecting the height of the pattern from the point of break down). On the flip side, a successful move above 0.7400 could send the pair at least back in sideways motion.

Upcoming fundamental data from New Zealand this week also points to a weak Kiwi. Tomorrow (December 21) at 9:45 pm GMT, New Zealand’s current account deficit for the third quarter of 2010 is expected to have widened to -NZD2.23 billion from -NZD0.88 billion. The current account measures the difference in between imported and exported goods, services, income flows, and unilateral transfers. The increase in the deficit means that more money had sent more money out than it had received. Also at hand this week is New Zealand’s 3Q GDP growth on December 22 at 9:45 pm GMT. Based on the market forecast, New Zealand’s GDP growth is expected to have cooled to 0.1%, half of the previous quarter’s 0.2% economic gain. Looking closely at the country’s retail sales which can be used as an indicator of overall consumption, data shows that headline sales remained flat in the third quarter, falling by 0.5% in July, 0.0% in August, before finally rising by 1.7% in September.

More on LaidTrades.com …

By Greg Holden

Ahead of the Canadian monthly wholesale sales report (13:30 GMT), it appears the USD/CAD is building towards a decision point.

On the shorter time-scale, we can see the pair stagnating between the 38.2% and 50% Fibonacci retracement levels, suggesting trader indecision prior to this release.

Expectations are for an increase of 0.8%, up from last month’s reading of 0.4%, which appears to be forecasting a drop in the pair as the loonie gains in value against the USD. The technical indicators below support this downward sentiment.

If Wholesale Sales come as expected, traders should anticipate a downward move towards 1.0100.

USD/CAD – 4-Hour Chart

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By Russell Glaser

As the year comes to an end, spot gold prices are down the past two weeks as traders and institutional investors take profit on long positions in the commodity that has appreciated over 25% this year alone.

Over the past two weeks the price of gold has fallen from an all-time high of $1431.00 to $1371.05, for a decline of almost $60 or 4.1%.

The declines may be worrisome to traders as a two week decline in the price of gold may have pushed many short term traders out of the market. However, long term instructional traders may be in a better position to absorb a 4% decline in the price as the price declines barely put a dent in the uptrend when looking at the longer time frames such as the weekly and monthly charts.

Can the recent declines in the price of spot gold be attributed to end of year profit taking on a commodity that is up 26% the year?

Looking back, it is not surprising the rise in the price of spot gold. What is surprising is the extent of the gains. An environment with ultra-low interest rates may have sparked long term inflation fears, driving traders into what George Soros called, “The ultimate asset bubble.”

Despite repeated calls for declines in the price of spot gold that did not occur from analysts, economists, and traders alike, what conditions would make for an environment suitable to falling gold prices?

It is fair to assume that this asset bubble may pop when global interest rates begin to rise and inflation expectations are subdued.

However, when looking at the monetary policy of the larger developed economies; the US continues to employ loose monetary policy with just last month announcing measures to increase liquidity with a second quantitative easing program. The ECB would like to raise interest rates but doing so could drive the European fiscal crisis deeper in some financially troubled countries. Japan is fighting deflation and is in no position to raise rates.

China on the other hand has begun tightening monetary policy. This could be the first sign that the global economy is beginning to make a change in its stance on inflation which could influence global inflation expectations.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By Yan Petters

After a couple of weeks that the EUR/CHF pair has consolidated around the 1.3000 level, and saw very little volatility, the bearish trend has resumed, and the pair is currently trading near the 1.2730 level. In addition, several technical indications suggest that the pair’s bearish move is likely to proceed, with potential to reach the 1.2600 level by the end to today’s trading session.

• The chart below is the EUR/CHF 4-hour chart by ForexYard.
• It can be seen that between November 30 and December 14 the pair saw very little volatility, and was trading near the 1.3000 level.
• However, the pair is dropping rather consistently ever since, and is now trading near the 1.2730 level.
• In addition, a bearish cross of the Slow Stochastic is suggesting that the bearish move has more room to go.
• The RSI is pointing down as well, and is currently floating near the 40-line. If the RSI will fall below the 30-line, meaning entering the over-sold zone, it will probably validate today’s bearish session.
• Another possible validation of today’s bearish trend could be the forthcoming bearish cross by the MACD. On the last time that MACD has completed a bearish cross, the pair almost instantly dropped about 200 pips. Such development can take place again.
• The pair’s nest support levels are located at: 1.2720, 1.2650, and 1.2600.
• The pair’s next resistant levels are found at 1.2795, 1.2860 and 1.2920.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By Forex Signs, Inc.

Readings of the CADJPY currency pair chart on an H1 time frame shows the pair currently consolidating with low volatility inside the 83.55 resistance line and 83.41 support line as of the last 10 candle sticks. Consolidation began as the pair hit the resistance while moving in a volatile downward channel. Moving Averages suggest that the pair will continue in a bearish trend as the price is moving below the Exponential Moving Average (14) of 83.50 while the pair’s Simple Moving Average (14) also is virtually identical at 83.49. The Ichimoku Kinko Hyo (9, 26, 52) is also suggesting that the 83.41 support line may be broken as the indicator’s tenkan-sen is moving below the kijun-sen with no signs of any cross over. It is also to be noted that both the tenkan and kijun are found inside the kumo which suggests a neutral selling signal.

RBA’s Secured Facility for Banks

As of today’s Asian session, with the Australian central bank planning to offer contingency loan to its banks, global liquidity is expected to remain at ease, thus marking a stronger Australian dollar compared to Yen in the upcoming session. As it provides secured facilities that could likely cover any gaps between lenders’ liquid assets and global regulator’s requirements.

On the contrary, since this is a secured facility of the RBA, Australia’s larger banks is expected to present reasonable steps. Provided that they really had tried their best to meet the Basel’s requirements by their own balance sheet management, before relying on the RBA facility.

However, the RBA is expected to first work on the fee before presenting the facility. For banks may have to choose to increase the size of their secured facility if it is too low, or may raise lending rates to regain the costs if the fee is too high.

So far, Australian is likely to be on a bullish trend against the Yen, but may still be driven in volatility in the upcoming session.

About the Author

Forex Signs, Inc., Founded in 2006 in Wall Street, New York City, FSI relentlessly strives to be the premier Forex brokerage company in the industry by providing exclusive and unmatched trading and investment related services while constantly developing innovative solutions that cater to the vast requirements of both individual and institutional market participants.

Source: ForexYard

Confusion over if and when the Irish bailout will occur, has caused the euro to extend its losses from last week in overnight trading. Against the USD, the 16-nation currency dropped as low as 1.3126 before staging a minor comeback. Currently the pair is trading around the 1.3150 level. Whether or not the euro will be able to recoup its recent losses will largely depend on news out of the euro-zone.

Economic News

USD – Dollar Sees Modest Gains Ahead of Slow News Day

The US dollar saw some small gains in overnight trading, ahead of what promises to be a low liquidity situation in the marketplace. Since markets opened for the week, the greenback saw a 50 pip jump against the UK pound before a correction was staged. Currently the GBP/USD pair is trading at the 1.5513 level, compared to 1.5534 when markets opened last night. Analysts attribute the dollar’s gains to risk aversion among investors who are still unsure of the planned euro-zone bailout of Ireland.

Today, a lack of significant news events means that dollar values will likely be determined by news out of the EU. Any mention of when and how the Irish bailout will take place will likely hurt the dollar against the euro. That being said, investors are particularly hesitant to take any substantial risks at the moment, particularly as the year comes to a close. This may be a good time to bet on the safe haven greenback.

As for the rest of the week, USD traders will have to wait until Wednesday and Thursday before any significant US news is released. On Wednesday, particular attention should be given to the US Final GDP figure while Thursday’s weekly Unemployment Claims promises to generate market volatility. Until then, news out of the euro-zone is likely to dictate dollar values.

EUR – Euro Extends Losses in Overnight Trading

Possible problems with helping Ireland overcome its debt crisis have caused investors to bet against the euro, at least for the time being. As a result, the currency has fallen against virtually all of its main currency rivals, including the dollar, yen and UK pound. The EUR/JPY has fallen some 50 pips since markets opened for the week, while the EUR/GBP has dropped over 20. Currently, the pairs are trading at 110.28 and 0.8473, respectively.

Today, in addition to any news regarding the Irish bailout, traders will also want to pay attention to the EU Current Account figure, scheduled to be released at 09:00 GMT. According to analyst’s predictions, today’s figure will likely come in significantly better than last month’s. If this is indeed the case, the euro may be able to build up some momentum and recoup some of its recent losses.

As for the rest of the week, the German Consumer Climate report on Tuesday, and the French consumer spending report on Thursday, both promise to generate some market activity among euro pairs.

JPY – Yen Sees Minor Gains Against EUR and GBP

The safe-haven yen saw some small gains against both the euro and UK pound in overnight trading, as investors remain cautious regarding the strength of the European currencies. The EUR/JPY pair has fallen close to 40 pips since markets opened, and currently stands at the 110.35 level. The GBP/JPY pair dropped a similar amount, before staging a bullish correction. Currently the pair is trading at 130.20.

Today, yen values will likely be determined by news out of the euro-zone. Should investors continue to doubt the strength of common currency, the yen is likely to continue on its upward trend.

Later in the week, traders will want to pay attention to the Japanese Trade Balance figure, scheduled to be released late on Tuesday night. A positive figure will likely give the yen a bigger advantage over its main currency rivals.

OIL – Price of Oil Drops As Investors Avoid Risk Taking

The price of crude took a slight drop in overnight trading, falling around 30 pips to its current level of 88.68. The drop can be attributed to an increase in risk aversion following the confusion regarding the Irish bailout. Typically, commodities like crude oil move up when positive news causes investors to bet on riskier assets.

That being said, the price of oil is still close to its highest point in two years. Predictions remain that another jump in price could occur, especially as the weather in the US gets colder, thereby increasing energy demand. It appears that while crude may be falling in the short term, its long term prospects are still bullish.

Technical News

EUR/USD

The Williams Percent Range on the 8-hour chart is showing the pair well into oversold territory, indicating that an upward correction may occur. In addition, it appears that a bullish cross is about to form on the daily chart’s MACD. Traders are advised to go long in their positions today.

GBP/USD

With the 8-hour chart’s Relative Strength Index currently in oversold territory, and a bullish cross forming on the daily chart’s Stochastic Slow, the pair may be due for upward movement. Now sounds like a good time to go long on this pair before the price jump occurs.

USD/JPY

Most technical indicators are showing this pair trading in neutral territory. The exception seems to be the daily chart’s MACD, which is showing that a bearish cross has formed. Still, traders will likely want to take a wait and see approach for this pair today, in order to better gauge its direction.

USD/CHF

The 8-hour chart’s Williams Percent Range shows this pair approaching overbought territory. The 4-hour chart’s Stochastic Slow has also formed a bearish cross, supporting the theory that the pair could see a downward correction. Traders are advised to go short with tight stops today.

The Wild Card

NZD/USD

Most technical indicators show this pair trading in the oversold region, indicating a bullish correction is likely to occur. This includes the Williams Percent Range on the 8-hour chart, and the Relative Strength Index on the daily chart. Forex traders may want to go long on this pair today, as an upward breach is likely to occur.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

So far this year we have seen gold prices average over $1,200 an ounce. This year marks the ninth straight year of gold’s bull market. We have watched gold hit record highs throughout the year. This raises the question, where does gold go from here?

During March of 2008, just two short years, gold traded over $1,000 for the first time. So far this year, gold has averaged over $1,200 an ounce.  And since hitting the $1,300 mark has yet to recoil. With momentum like this we likely won’t see gold come down anytime in the near future. Some insiders are even expecting to see the current price of gold double by the end of next year.

Some analysts say gold can only go up from here. According to a recent article from the Wall Street Journal there is a huge demand for gold right now. And while we may have been attributing the gold rally to a failing economy, inflation woes and the declining value of the dollar, we may have forgotten about gold demand. WSJ reports that various countries such as China, Russia and India are buying up gold by the brick fueling the gold rally. These countries will continue to buy gold bullion furthering the gold rally.

While global demand for gold is not the only cause for the skyrocketing price it is a factor. So what needs to happen for the price of gold to drop? Several things could cause a drop in the price of gold but none of which seem all that likely. A major gold discovery could cause a drop or a solution the U.S. federal budget crisis might also cause a dip in gold price.

Gold has only just begun its rise and gold along with other precious metals that are also making leaps and bounds should be watched closely. This is a bull market with many years still ahead of it.

About the Author

Article by Chelsea Perry

By James Woolley

It has to be said that many people approach forex trading the wrong way. They believe that the more trades they make, the more money they will make. However this isn’t the case at all. In fact the opposite is true in a lot of cases.

The problem with short-term trading is that it is notoriously difficult to make money. The markets move all over the place during any given day, and with spreads of between 2 and 5 pips, it is almost impossible to continue to generate profits from these short-term price movements. Even if you use technical analysis to help you, you will still find things difficult because you get a lot of false signals.

However if you lengthen your time frames and start to look at the 4 hour or daily charts, for instance, you will find that these random short-term price movements become irrelevant because they are just a very small part of the wider picture. If you now apply some technical indicators to your charts, you will find that they give a lot more reliable signals.

The truth is that you can make just as much profit from one good trade on these longer time frames than you can from the combined total of tens of trades on the intraday time frames. You just need to have enough patience to wait for the very best set-ups.

This is what I did recently with the EUR/USD pair. The long-term trend had recently turned negative and I was simply waiting for a slight pull-back followed by a continuation of this new downward trend. As soon as the EMAs that I use crossed downwards on the 4 hour chart, I entered a short position and banked a very easy 100 points.

The price has since fallen another 200 points, but that’s irrelevant. The point is that it’s better to trade maybe one or two positions a week, like I do with my main 4 hour trading system, than stress yourself out opening and closing lots of different positions all day long.

There is a lot of money to be made from forex trading, but you have to approach it with a sensible head. Very few people can consistently make money day trading the markets, but a lot more people, including myself, are able to make decent profits trading the longer term charts. If you are selective about your trades and wait for the very best set-ups, then you should be very successful.

About the Author

Click here for more information about a forex course that will teach you all the basics of currency trading, and to read a full Forex Nitty Gritty review.

By Markus Heitkoetter

Fixed percent money management is a wonderful money management technique used by many traders with much success. As with all money management strategies, there are pros and cons, and not all money management strategies are suitable for all traders. This article can help you decide whether or not fixed percent money management is right for you.

Fixed percent money management is one of the easiest anti-martingale money management strategies that a trader can apply. Fixed percent money management requires a trader to designate a fixed percentage of equity as the maximum risk per trade. When an account is going down, this percent will represent a lower dollar amount of risk based on the account size. When the account is going up, this percent will represent the higher dollar amount based on the account size.

A trader using fixed percent money management will typically set a fixed percent of equity that is somewhere between 1% and 5% of their account. The 2% rule is very common, and simply means that a trader will risk 2% of their account at any given time. You do not have to use 2%, though. Your percent could be 1%, 2%, 5%, 10%, and should reflect your risk tolerance and profit objectives. A trader trading a $100,000 account, and risking 2% would be risking $2,000 per trade. Is this a risk you would be comfortable with? If so, this is probably a good percent equity to risk. If you are not comfortable risking $2,000 on a trade, you might want to consider a 1% fixed percentage.

Fixed percent money management is a conservative, anti-martingale method. It is also risk oriented, which means it focuses on risk, but not necessarily growth. It is very popular with fund managers, and with brokers who are trying to give some guidance to traders who are just getting started. However, it is very easy for all traders to apply and use. However, keep in mind that you may experience slow growth with this method even when you are trading successfully. It is also difficult to apply in Futures and Forex trading.

There are two types of traders who might benefit most from fixed percent money management. You might want to consider a fixed percent money management strategy if you are trading a very large account. It could be an appropriate way to manage a larger position or portfolio. You might also consider fixed position money management if you have a very low risk tolerance, and you are not willing to be too aggressive.

If you would like to learn more about fixed percent money management, and other money management techniques, you can go to http://www.RockwellTrading.com, and check out our money management and trading resources.

About the Author

Markus Heitkoetter is the author of the international bestseller “The Complete Guide To Day Trading” and a professional day trading coach. For more free information on day trading visit his website http://www.rockwelltrading.com