Forex Trading Time Zone

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).

So if you want to catch the best trading opportunities of the day and you are in the American continent you must be ready to wake up early or go to sleep late some times. Of course things change around the world. What's the best region where to trade from if you can't wake up early?... Maybe the Ukraine

Forex Trader Type

There are 3 types of forex trader out there, trading and control the market :D. they are Position trader, swing trader, day trader.

Position trader is A type of forex trader who holds a position for the long term (from months to years). Long-term traders are not concerned with short-term fluctuations because they believe that their long-term investment horizons will smooth these out. Many position traders will take a look at weekly or monthly charts to get a sense of where the asset is in a given trend. Position trading is the polar opposite of day trading because the goal is to profit from the move in the primary trend rather than the short-term fluctuations that occur day to day.

Swing Trader is A forex trader who hold a particular positiom for a period of time, generally between a few days and two or three weeks, and trade the forex on the basis of its intra-week or intra-month oscillations between optimism and pessimism

Day trader is A forex trader who holds positions for a very short time (from minutes to hours) and makes numerous trades each day. Most trades are entered and closed out within the same day. This is a highly speculative practice. The reality is that most day traders lose money.

Money Management on Forex

Money management is one of the most important things you can learn before you actually begin making live trades on forex market.
The money management principles discussed here will teach you how to avoid the costly mistakes many new traders make, often to the degree that they lose their entire investment on the first handful of trades.
Psychology is really the most important factor to money management in forex. You have to be able to separate yourself from any emotional attachment you may have to your money. This is not very easy to do, but it works and it can be done.
If you allow yourself to become emotional on a trade, you will not exit the trade properly, and this could mean holding on to a trade when you should have let it go, or letting go before the trade had a chance to turn profitable.
First and foremost, you should consider leverage and risk. It is advisable that you never risk more than two percent of your account balance on any trade. However, some go further and allow for as much as ten percent, but never more than that. This gives you the ability to withstand market fluctuations, and if the trade goes bad, you still have money to try again. You should never operate under the assumption that you will profit from every trade. You should also plan for losses. Therefore, most traders will tell you that the best thing to do is to keep your gains large and your losses small. Develop your trading strategy around this idea.

Keep track of your gains and losses. Keeping accurate and detailed records of your account activity will allow you to see whether or not the strategy is working, or if it needs to be re-built.

Never go blindly into trading without a way to keep track of results. You will lose all of your funds and never understand why it happened.

Finally, it is highly advisable that you first practice a strategy on a demo account. Nearly all brokers offer a virtual account whereupon you make trades in real-time, but with imaginary money, so nothing is risked. This is the best way to test a strategy before you put your real money on the line.

However, be careful, once again, of the psychology of trading. When you play with fake money, nothing is risked. When real money is on the line, you must not get emotional. If you do, you will find yourself with very different results, most likely losses, than you had with the demo account.

UK March annual CPI inflation unchanged at 2.5 percent

LONDON (Thomson Financial) - Annual UK CPI inflation was unchanged in March at 2.5 percent as rises in air travel and energy prices were offset by falls in furniture prices, official figures from the Office for National Statistics showed.

However, inflation remained stubbornly above the Bank of England's (BoE) 2.0 percent target for the sixth month running.

The annual inflation rate was last higher in April 2007.

On a month-on-month basis, March CPI inflation slowed to 0.4 percent after rising 0.7 pct in February.

Both the monthly and annual rates missed expectations for gains of 0.6 pct and 2.6 percent respectively.

The fact that inflation has not risen further will come as a relief to the Bank of England rate-setters, who had the headline figures to hand at its meeting last week, and may have been a factor in their decision to cut the key Bank Rate by a quarter point to 5.00 percent.

The rise in inflation during March was driven by rises in transport costs, particularly air travel, as well as increases in the prices of heating oil and gas. Transport prices rose by an annual 7 percent, the highest since records began in January 1997.

These were offset by falls in furniture and furnishing prices, as well as in games, toys and hobbies.

Meanwhile, the BoE's concerns over rising inflationary pressures may have been tempered by continued subdued prices excluding volatile elements such as energy and food.

The underlying, or 'core' measure of CPI -- which excludes energy, food, alcoholic beverages and tobacco -- rose at an annual rate of 1.2 percent, unchanged from February.

On a month-on-month basis, core CPI was up 0.4 percent after rising 0.3 percent in February.

Elsewhere in today's release, the statistics office said the annual rate of RPI inflation -- which includes housing costs and is used in pensions payments and pay negotiations -- fell to 3.8 percent from 4.1 in February. This is the lowest rise since July 2007, and misses expectations for a smaller drop to 3.9 percent.

The decrease in the RPI rate was driven by falls in mortgage interest payments as lenders passed on the Bank of England's interest rate cut in February.

On a monthly basis, RPI inflation rose 0.3 percent after rising 0.8 percent in February, well below forecasts for 0.6 percent rise.

Meanwhile, the annual RPIX measure, which excludes mortgage payments, was 3.5 percent, against 3.7 percent in February, again missing forecasts for 3.6 percent.

However, the annual RPIX measure remains well above the 2.5 pct annual rate that the BoE was previously charged with targeting and has been above that level since May 2006.

Month-on-month, RPIX was up 0.5 percent after increasing 0.8 percent the previous month, below expectations for a rise of 0.7 percent.

Copyright Thomson Financial News Limited 2008. All rights reserved.

Margin Vs Margin Call

What is margin in forex?

Margin is the amount of equity that must be maintained in a forex trading account to keep a position open. It acts as a good faith deposit by the trader to ensure against trading losses. A margin account allows customers to open positions with higher value than the amount of funds they have deposited in their account. The margin available will limit the size of your position. You can not open a position with a size bigger than the available margin. The margin requirements depend from broker to broker. Most popular brokers require 2% to .5% margin, which of course is relevant to their leverage. If you’re broker offers a leverage of 100:1, you’re margin will be 1%; if a broker requires a margin of 2%, you’re leverage will be 50:1 (100:2).

Margin call in forex is called the action that your broker takes by closing some or all of your open positions at the market price when your margin is no longer sufficient to cover your losses. In other words when you’re equity is equal to your used margin, which means you are out of available margin then you’re broker takes actions to prevent further losses, therefore closing your positions.

How to Avoid margin call?
There are some several way to avoid margin call
1. Good money management, manage how you trade
2. Use stop loss for every position if you don't have enough margin
3. Do not over trade :)

Mini Forex Account

A mini forex account is designed for those new to online trading and those with limited investment capital. Those with less than US$5,000 often favour mini accounts although regular accounts may be opened with a minimum of $2000-$5,000. The amount varies from broker to broker.

A mini forex account can be opened with a minimum of US$25-500 and this figure varies between brokers.

A mini forex account is intended to introduce traders to the excitement of forex trading while minimising risk.

• A mini forex account can be opened at anytime but many traders practice on a demo account first to test their trading strategies and techniques.
• Trading size is normally 1/10th the size of a regular account. Some brokers have smaller lot sizes. This reduces the risk associated with forex trading.
• Margin requirements differ depending on the broker. The NFA states the margin should be no less than 1% of the base currency traded. However not all brokers follow these guidelines. Some brokers offer margins as low as US$50 per lot on their minis.
• Some brokers have software in their Trade Stations that automatically calculates the required margin while others manually set the margin and vary it accordingly.

The CFTC is enforcing a 1% margin requirement for registered FCMs and their affiliates that only offer trading in the Forex Market.

The new NFA rule requires a minimum 1% margin at all time to maintain an open trade. (Note this may change from time to time so although we use 1% as the example at some stage in the future the margin maybe different. However using similar calculations one can easily calculate the new margins)Some deal stations automatically calculate this according to the formula and hence the margin requirements are continually varying.

Based on a 1% margin requirement

Example 1:

GBP/USD rate: 1.7442/1.7447

Account type: $10 000/lot

1% leverage: 10 000x0.01 (1%) =100units

With the GBP/USD, the margin required is:

1.7447 (GBP/USD) x100 (units of base currency GBP) = USD174 for each lot.

Example 2:

EUR/USD rate: 1.2326/1.2331

Account type: $10 000/lot

1% leverage: 10 000x0.01 (1%) =1000units

With the EUR/USD, the margin required is:

1.2331 (EUR/USD) x100 (units of base currency EUR) = US$123 for each lot.

• On a mini forex account where the margin is only US$50 per lot, a trader with $500 can withstand a larger market swing than a trader with a regular account with higher margins but if they have a margin call will lose more capital. A margin call occurs when the balance of the trading account falls below the required minimum balance required. The broker then closes all open trades.
• Mini forex accounts have become very popular as many stock investors are taking positions in the forex market to spread their risk.
• It pays to compare mini forex accounts at different brokers to find the best rates on overnight positions and the most competitive spreads.
• Pip values vary between the different currency pairs. Based on a US$ 10K account, a 25 pip profit on a mini account Euro trade is $25 and since this is a small amount, a mini account allows traders to focus on technical analysis instead of the profit and exit at the right point rather than take profits early. On a regular account (100K), 25 pips would give US$250 profit.

Forex Trading Online Benefit

Do you know what Forex trading is? Some people have heard of this type of trading, others have not. If you haven't, it might be something you are interested in trying. Forex trading stands for foreign exchange trading. What it consists of is the buying and selling of different currencies. This is done simultaneously, and there are people who make a lot of money with this kind of trading. This is apparent by the 1.9 million dollar turnover in this market that happens every day. Also a lot of it is done online. Online Forex trading is very popular.

The most common currencies to trade are the Euro and the U.S. dollar, and the U.S. dollar and the Japanese Yen. However, nearly all of the Forex trading done involves the major currencies of the world. These include the Euro, Japanese Yen, U.S. dollar, Canadian dollar, British Pound, Australian dollar, and the Swiss franc. The Forex exchange is different from other exchanges, such as the New York Stock Exchange, in that it does not have a physical location or central exchange. The exchange day begins in Sydney, then moves to Tokyo, on to London, and finally ends in New York. Each country takes the responsibility of regulating the Forex exchange activities in their own country. So there is no overall regulatory agency. However, this does not seem to be a problem and most countries do very well at overseeing Forex exchange activities.

There are a lot of things that influence the Forex rate. For instance, economic things, like interest rates and inflation, and also political things, such as political unrest in other countries and major changes in government cause up and down changes in the Forex rate. However, these things tend to be short-term, and don't affect it for long.

Online Forex trading sites are easy to find by surfing the Internet. Most of them provide a wealth of information for the first time trader. You can find out about the history of Forex trading, how to co it, tips on being successful, etc. You can also start trading with as little as $250 in your account on some sites. For anyone who is interested in currency or trading, it is something you should check out.

As with any type of trading, there are no guarantees that you will make money or that you won't make money. It is a smart choice to learn as much as you can about online Forex trading before investing any money and doing any trading. It is a fact that informed investors do better than those who don't know much about what they are trading. So get the fact before you dive in. You might just make a little money in a very interesting currency exchange.

by Bob Hett

http://www.forexinformation.info

Technical Anlaysis in Forex Market

Technical Analysis is A method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume. Technical analysts do not attempt to measure a security's intrinsic value, but instead use charts and other tools to identify patterns that can suggest future activity.
Technical analysts believe that the historical performance of stocks and markets are indications of future performance.
n a shopping mall, a fundamental analyst would go to each store, study the product that was being sold, and then decide whether to buy it or not. By contrast, a technical analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the intrinsic value of the products in the store, his or her decision would be based on the patterns or activity of people going into each store.

UK March house price balance most negative since survey began in 1978 - RICS

LONDON (Thomson Financial) - The crisis in the UK's lending markets has pushed the number of chartered surveyors reporting house price falls in March to its highest level since records began, the Royal Institution of Chartered Surveyors said today.

In its monthly survey of the sector which began in 1978, RICS said 78.5 percent more of its members reported a fall in prices rather than a rise in the three months to March.

That was even worse than the -65.7 percent recorded in February and the historical low of -64.5 percent recorded in June 1990, just ahead of the last recession in the UK, which prompted the last house price crash.

The scale of the decline, the eighth in a row, was unexpected. The consensus of analysts polled by Thomson Financial News saw the house price balance worsening to -67.0.

The prospects for the housing market don't look particularly healthy either, at least not until the liquidity crisis eases, RICS said. Price expectations fell to their lowest level since this series was included in the survey in October 1998.

'Sentiment is at a very low ebb and will continue to remain depressed while the economy suffers from this unique liquidity blight,' said RICS spokesman Jeremy Leaf.

However, Leaf said a significant crash 'remains unlikely' so long as the supply of new housing remains low.

RICS said there were wide disparities around the country, with the East Midlands suffering badly, with 89 percent more surveyors reporting a fall rather than a rise there. A net 86 percent reported falls in East Anglia too.

Scotland remains the only UK region with the net balance of surveyors reporting rises.

RICS also found that demand continued to weaken, with 49 percent more chartered surveyors reporting a fall than a rise in new buyer enquiries, up from 39 percent in February. March's rate matches last September's low, which had been dragged down by the fallout from the run on Northern Rock.

Sharp declines in enquiries were matched by an equally sharp fall in newly agreed sales. Completed sales per surveyor also fell 20 percent year-on-year, further underlining the deteriorating activity picture.

RICS said many would-be-buyers are either struggling to raise the necessary finance to precipitate a move or are exercising caution in the light of current economic uncertainty.

With the official interest rate cuts not being passed on to the high street there is little expectation that demand will improve in the near term, it added.

In normal circumstances, the RICS figures, together with this morning's bad news from the British Retail Consortium, may well have cemented market expectations that the Bank of England will cut borrowing costs in May for the second month running.

However, with inflation running high, the BoE may well keep its benchmark Bank Rate at 5.00 percent.

Copyright Thomson Financial News Limited 2008. All rights reserved.

Online Pivot Point Calculator

Just found this cool online pivot calculator from fx-bar.com. you can try it out. it's nice :)