Happy Holidays from FXEDU!
By Mike Conlon | December 24, 2009
In what some might see as an “early Christmas gift”, jobless claims fell more than expected to 452,000, beating analyst expectations of 470,000. This is a positive sign that the US economy is recovering…. but it’s not out of the woods yet. In any event, the news bolsters the economic trends that we’ve seen recently in the markets.
So as we move into year end, I want to extend warm holiday wishes to all of our subscribers and wish you health and happiness during the holiday season!
I’m also going to take this opportunity to tell you about some of the exciting things we’re going to be doing in the new year!
Starting next year, we will be introducing new Expert Advisors (EA) for our members. For those of you who are not familiar with Expert Advisors, they are basically automated trading systems that allow you to take advantage of opportunities in the forex market. These have been developed for us by some of the top trading minds in the business, so be on the lookout for their arrival!
Also, I have a series of interviews lined up with some of the leading experts in the forex market who are going to be sharing their unique insights and views with us!
And lastly, we will be announcing our “end of the year” blowout promotion next week as a thank you to all of our subscribers! If you’re not registered for the blog yet, you can do so now by entering your email address at the top right corner of the website.
As we move closer to the New Year, it is now more important than ever to understand the forex market as the global economy moves forward. Those who take the time to learn about this market will be better positioned to take advantage of the numerous opportunities that present themselves daily.
So make a New Year’s resolution to yourself to learn about the currency market!
Happy Holidays to all!
Tags: blog, currenc, currency, currency market, economic, economy, forex, forex market, holiday, Il, mike conlon, news, time, trading, trend
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Santa Claus Rally!
By Mike Conlon | December 22, 2009
Historically, the month of December has been the best performing month for stocks. Much of this can be attributed to “window-dressing”, the practice of fund mangers pushing up stock prices to make their portfolio performance look better for year end. This is where the nickname “Santa Claus Rally” comes from; that the cheery rotund man in red is bringing you a Christmas gift in the form of higher returns!
Today marks the highest level for the equity markets in all of 2009– despite the earlier downward revisions to GDP that we mentioned earlier. Also to note that gold and oil are down, and the US dollar (USD)is seeing some strength against all major currencies except the Canadian dollar (CAD) which is showing strength over the last three days due to improved economic conditions and the possibility of near-term rate hikes.
I often mention the correlations between the different markets so its important to note where other markets are trading with regard to the forex market. Again we are seeing a dollar up, stock market up scenario that is a continuation of the condition that I spoke about yesterday– that the anti-dollar sentiment may be fading from the markets.
So in any event, be wary of the “rosy” picture of the markets that is being painted for you going into year-end. While its OK to attend the party, be wary of the hangover that inevitably occurs once the New Year comes around.
Do you have an interest in the forex market? If not– you should! Check out a free, real-time practice account to see what all the excitement is about by clicking here!
Do you have an interest in forex but are afraid to get started because you don’t where to begin? Check out our courses to learn how to get started!
Tags: account, cad, course, currenc, currencies, dollar, dow, economic, forex, forex market, free, fx, fxedu, gold, Il, interest, Mike Conlon, oil, practice, practice account, rate, sentiment, ssi, stock, stocks, time, trading, USD
Topics: What To Look At In The Market | 1 Comment »
No Change at BOJ!
By Mike Conlon | December 18, 2009
The Japanese Central voted to keep their interest rate at .1%, attempting to encourage economic recovery. Japan has been battling deflation for MANY years, but it has picked up recently as the most recent CPI (consumer price index) declined 2.2% in October, marking the eighth straight month of declines.
The also issued a statement that they do not “tolerate” deflation, but issued no plans as to what they actually intend to do about it. Mostly hollow words if you ask me.
So this morning we’re seeing some Yen (JPY) weakness, as its down across the board, most notable against the Canadian dollar (CAD) at -1.07%. CAD is strong due to a rebound in oil prices which is trading above 74.
Also, I’m seeing a bit of British pound (GBP) strength this AM as UK mortgage approvals rose. This means the banks are starting to lend more and hopefully that will help stabilize their housing market.
Euro is a mixed bag this AM, trading flat against USD so far. News out of Greece is that they are going to reform their notoriously lax tax policy to try to raise revenue to get their debt under control. In Germany, Business confidence reached its highest levels since July 2008.
The Swiss franc (CHF) has advanced past 1.50 Euro, as the Swiss National Bank (SNB) allowed the currency to appreciate. Back in March, the bank intervened in its currency to keep it from appreciating and undermining economic recovery.
Lastly, today is “quadruple witching“– where both futures and options positions expire. So this could lead to some volatility today… though I suspect it won’t be bad as traders have been paring back positions for the holidays and year end.
Tags: bank, cad, CHF, currenc, currency, dollar, dow, economic, EUR, Euro, franc, gbp, Il, index, interest, interest rate, invest, Japan, jpy, market, Mike Conlon, news, oil, pound, Swiss, trade, trader, trading, USD, Yen
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Survived the Weekend!
By Mike Conlon | December 14, 2009
Last Friday the markets seemed a bit “nervous” as recent negative news around the globe has been trickling out. Going into year end, traders are more cautious over the weekend as there are any number of potential land mines out there that could derail world economic stability. Let’s examine a few:
Problems with the Euro. We covered this one last week but its going to be interesting to see what happens to the PIGS (Portugal, Ireland/Italy, Greece, Spain). If any of these countries comes any closer to sovereign debt default it could be a MAJOR problem. As a result, there are growing short positions in the Euro.
Reduced oil demand. Because economies are not improving as rapidly, oil demand is off and oil prices are coming down a bit, with oil trading at around $69/barrel. This is also due to recent dollar strength, which is also causing a pullback in gold prices as well. As a result, so far this morning the Canadian dollar (CAD) is down across the board.
Yen moving back to become the funding currency of choice for the carry trade. Yen strength may reverse if there are any signs that the Fed may change their language at this weeks FOMC meeting.
Other than that, there’s nothing major happening today. The yen is strong as Japan continues to battle deflation and there is no threat of a rate hike anytime soon. So today seems like sideways action, perhaps waiting for Wednesday’s meeting.
To learn more about how the currency market works, be sure to check out our courses!
Tags: cad, carr, carry trade, course, currenc, currency, currency market, dollar, dow, economic, EUR, Euro, fed, fx, fxedu, gold, interest, Japan, meeting, Mike Conlon, news, oil, rate, short, time, trader, trading, Yen
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Afternoon Update!
By Mike Conlon | December 7, 2009
Just wanted to drop a quick note about the trading action today. The US dollar (USD) is down slightly, as the stock market is up a bit also. What’s interesting is that gold is also down, perhaps as a result of coming “a little too far, a little too fast”. I’m not certain if the usual correlations in the market are going to breakdown completely, but I think they definitely will be tested in the coming days and through year end.
Also to note is Canadian dollar (CAD) and Japanese yen (JPY) strength.
Tags: cad, dollar, dow, gold, Il, interest, Japan, jpy, market, Mike Conlon, stock, trading, USD, Yen
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Good Morning for Pac Rim!
By Mike Conlon | November 13, 2009
So far this morning, Pacific Rim currencies are faring the best led by the Japanese Yen (JPY) which is up against the Euro (+.84%) and the US dollar (+.74%) What seems odd though is that the next best performers are the Aussie and the Kiwi.
Under “normal” circumstances, these currencies are on opposite ends of the spectrum so to speak. The Japanese Yen benefits the most from the risk-aversion trade, and the Aussie and Kiwi benefit the most from risk-seeking. So which is it?
Well today its a little bit of both! Now we all know that Obama is over in the neck of the woods trying to get everyone on-board with US, but this market action is interesting to me. Now, Japan did just report good growth numbers, but they risk economic slowdown as reported by Bloomberg here.
Why this is strengthening the yen while traders are seeking higher yields is a mystery to me (if anyone knows– feel free to chime in;)
In any event, when I see a situation such as this one, I usually feel that something “has to give”. So I am anticipating a little bit of reversion to mean here, and am thinking that both the Aussie (AUD) and the Kiwi (NZD) might go negative before today’s session is over.
Unfortunately, I am having MT4 issues this morning so I may just sit on my hands, but will be keeping an eye on Yen crosses and Aussie and Kiwi. You should as well.
Check back later to see how this pans out and wish me luck with my MT4!
To follow these trades live, get a free, real-time forex practice trading account here!
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Tags: account, AUD, Aussie, course, currenc, currencies, dollar, dow, EUR, Euro, forex, free, fx, fxedu, Il, interest, Japan, jpy, live, market, Mike Conlon, news, nzd, practice, ssi, time, trade, trader, trades, trading, Yen
Topics: What To Look At In The Market | 1 Comment »
FOMC Rate Decision at 2:15 EST!
By Mike Conlon | November 4, 2009
Well here comes Bernanke again, who seemingly has become more of an English professor than an economist. Why do I say that? Well, all ears today will be on whether or not Bernanke is committed to keeping interest rates low for an “extended period”.
So basically, the market is waiting to hear those 2 magic words: EXTENDED PERIOD.
What happens if we heart those words again? Consensus is that the stock market and commodities will rally at least in the short-term, as will the commodity currencies (AUD, NZD, CAD) and the US dollar will fall against all but the Japanese yen (JPY). In other words, the risk-taking trade that I talk about so much.
Should the language change, then expect the risk-aversion trade to be on.
Either way, there are some encouraging signs that the economy is stabilizing if not improving, so rate hikes like the ones seen in Australia and Israel may be coming in the not-so-distant future.
So far in this mornings action, it looks like traders aren’t expecting any change in the language and haven’t waited, as JPY and USD are the biggest losers so far this AM.
So if your day-trading, remember to be careful around this announcement as the action can get VERY volatile in the minutes preceding and following the announcement.
Good trading to all.
If you’d like to follow the action live in a free, real-time demo account, click here.
Tags: account, AUD, cad, commodities, commodity, currenc, currencies, demo, dollar, economy, free, fx, fxedu, Il, interest, interest rate, interest rates, Japan, jpy, live, market, Mike Conlon, nzd, stock, time, trade, trader, trading, USD, Yen
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About Face!
By Mike Conlon | October 26, 2009
Well the morning started off benignly enough with some minor moves in the commodity currencies, but an “about face” has occurred. This morning I commented on Aussie and Kiwi strength and Dollar and Yen weakness. Well it looks like the exact opposite is true now.
It looks like the equities market has reversed course, with the Dow 30 going from up +100 or so points this AM to down -100 or so points. So as equity markets went from gains to losses, the currency trades went from risk appetite to risk aversion. Also to note is that oil is now trading down to under $80, and gold is off a little as well.
The Canadian dollar is also getting hit a bit harder than earlier, as it can be influenced by gold and oil prices. CAD is down roughly 1.00% today so far vs. USD and JPY.
I’ve actually had a small short traded triggered in AUD/USD as I was thinking that with gold down this AM that either gold would go positive or AUD/USD might fall. I set up at limit sell that got triggered with a tight stop, for a short-term day trade.
Because of the inter-relationships between currencies, commodities, stocks, and interest rates, it is sometime easier to “telegraph” a move in one when you have a decent idea where the other is going (or might go).
To learn more about these inter-relationships, known as correlations, get educated here.
To follow along with a real-time practice account, click here.
Tags: account, AUD, Aussie, cad, commodities, course, currenc, currencies, dollar, dow, fx, fxedu, Il, interest, interest rate, interest rates, jpy, market, Mike Conlon, practice, ssi, stock, stocks, time, trade, trades, trading, USD, Yen
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Euro Green, But For How Much Longer?
By Mike Conlon | October 13, 2009
The morning’s trading started out with Euro (EUR) strength but it has been pulling back. While still positive against other currencies, it looks like it could go negative as its barely holding on to gains. The initial strength this morning was based on reports that global reserves were moving from US dollars to Euros.
The Euro is known as the anti-dollar, so this makes a bit of sense. However, with US dollar weakness, one would expect the equities markets to be up today, and so far they are negative. Both gold and oil are up marginally, although off of their earlier highs.
So perhaps the US stock market weakness is contributing to yen (JPY) and dollar (USD) paring back losses against the Euro. As earnings season is in full effect for US stocks, keep an eye on the Euro. If stocks stay negative, then the Euro may give back some gains as we expect the correlations to hold up.
Check back later to see how the Euro fares!
Tags: currenc, currencies, dollar, EUR, Euro, gold, Il, jpy, market, Mike Conlon, oil, stock, stocks, trading, USD, Yen
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Loonie Tunes!
By Mike Conlon | October 12, 2009
In a continuation of the move that started last week in the Canadian dollar (CAD), this morning it’s the top performer (USD/CAD -.81%), (CAD/JPY +1.24%). A report out of RBC Capital markets advised clients to sell the US dollar and buy the Loonie as the analyst is forecasting that the Canadian government will raise rates sooner and more aggressively than the US.
Considering the unemployment figures they reported last week, this makes sense. However, I still have a concern about whether or not the Fed is going to be forced to take action with regard to it’s ahem “strong dollar policy”- that is the debasement of USD. Should Central Banks start dumping dollars, this could set off a nasty chain of events.
Obama is the “populist” President (see winning Nobel Peace Prize); I wonder at what point he will have to change tactics to prevent a total US dollar collapse.
While this appears to be “the trade”, when everyone and their brother screams sell dollars my natural contrarian disposition is to do the opposite. However, I don’t want to fight the trend (which is clearly down for USD) but I will be keeping close watch for the first signs of a reversal.
So my short-term outlook is dollar negative, but my longer-term thesis is that I’m looking for buying opportunities and signs that Fed may have to step in to support the dollar. Something’s gotta give here, I just hope its not support that send the dollar into free-fall!
To learn more about how government actions affect the various markets, check out our currency courses.
Or sign up for a free demo account if you want to practice your trading and see how the currency market works real-time.
And if you acted responsibly and want to hold on to your life savings and protect it from devaluation, get started with a live account today!
Tags: account, bank, cad, central bank, course, currenc, currency, currency market, demo, demo account, dollar, dow, fed, free, fx, fxedu, jpy, live, Mike Conlon, practice, rate, short, ssi, time, trade, trading, trend, unemployment, USD
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