Most people who get involved with free forex training aren't able to understand the importance of the US Non-Farm Payroll report to financial markets on a global basis . I often get the question , "why does the monthly US jobs number led to ups and downs in the market?" To provide an answer to the question it is important to look at what is represented by the US jobs number . Then we will have our insights as to why it makes the markets move like nothing else .
On the very first Friday of a new month, the US Non Farm payroll is then released. This report is put out by the US Bureau of Labor and Statistics and what it quantitatively measures , is the number of brand new jobs, excluding farming, created in the prior month by the US economy . This announcement is so important because it reflects the overall health of the US economy and thus the global economy . In reality , in the world, the US economy happens to be the largest and consumer spending is the main component driving the economy in the US ; actually making up 70%! Thus , in free forex training, because the weakness or strength of a currency in a country is mainly affected by the interest rates in the country , one must look to what drives the actual interest rates themselves ; or the US Federal Reserve policy on interest rates. Probably the most important data for the Fed to use is this job report in order to set their short term interest rates and because of this, this report can and usually does , cause significant volatility across the markets .
Why does this report have anything to do with the short term interest rates set by the Federal Reserve? That's a good question ! If the jobs report is on the strong side that generally means that people are employed and resource utilization is high . This also means that companies are employing workers and the consumers, or workers, are then spending money by shopping, dining out, or on clothing, and the economy is driven by these things ; they make the economy grow or heat up . There is more money in circulation when the economy is growing and keeping inflation in check is very important for the Federal Reserve. They can keep inflation in check and lower inflation by raising the short term interest rates, which cools the economy down , or they can raise inflation by lowering the short term rates, heating the economy up. As you can see , so a big factor is the jobs number, beneath the surface driving this .
The next time you are trying to prepare for a free forex training day or the next week , take a look at the fundamental information on the events calendar that will be released in the next day or week . If it's the first week within a month then you'll have the Non-Farm Payrolls report to look forward to on Friday of that first week because that is when it always comes out . If you're looking to take advantage of the volatility that comes after the release of the jobs report , just remember the following formula : If the jobs numbers are stronger than expected this usually means a stronger economy which means higher short term interest rates that lead to currency strength . On the other hand , if there is a weaker than expected jobs report then this usually means lower short term interest rates that lead to currency weakness . It's not always so black and white , but knowledge of these general parameters will give you a leg up on your fellow trading competitors .
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
Wednesday, October 20, 2010
Thursday, October 7, 2010
Basic Money Management And Free Forex Training
Free forex training gives anyone, anywhere, the opportunity to make a very nice living . What better way to make a living than waking up every morning, enjoying a cup of joe , and then setting up the trading day while in your pjs ? Pretty easy ! Hang on because while it can be that easy and relaxing most people quickly find out that it is not that easy at all . That's why this article is going to look at principles of money management - because if you know the basics of money management success is more likely for you.
So why, if this area of money management is so very important , do so many people ignore or overlook it ? That's a great question and one you need to take a hard, long look at if you want to succeed . I think that this aspect of trading is skipped by people, money management basics , because it is not "sexy" . After all , how many really interesting accountants do any of us know ? That's what this is really about ; boring numbers and more boring numbers .
With all of that said , it is only boring if you chose to think about it and approach it as such . If you look at this as boring, it will be boring and it's something you won't want to do. If you look at this as an important key to becoming a free forex training professional and you keep focused on the possibility of success ahead if you spend some time thinking your tactics for money management through.... then it can turn into something that is exciting.
Now you're convinced that this area needs to be focused on . Awesome! What is it all about then anyway ? Here are the keys in order of importance , you'll have a great start if you follow them : over leveraging yourself should never be done, the leverage on each trade should be consistent , add to winners and do not add to losers . That's it . There are some tributaries of course to all of the aforementioned but they are incredibly powerful even all by themselves .
When you are trying to figure out why your trading level hasn't advanced the way you wanted it to , keep in mind the money management keys . Another final thing to keep in mind is this: unimaginable psychological benefits can be provided by good money management. And these psychological benefits will improve your trading beyond what you ever thought was possible . Why? If you're not afraid of losing money , or you know you have a solid plan in place that will ensure you're always around to trade another today , then you can look at markets from a state that is relaxed and clear and for your efforts you'll add some serious dividends.
Free forex training can be one of the most challenging and rewarding things ever . Remember that the most valuable keys to your success are often the most simple and probably uninteresting things staring you right in the face . You've wanted to find the trading holy grail - and money management is it .
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
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So why, if this area of money management is so very important , do so many people ignore or overlook it ? That's a great question and one you need to take a hard, long look at if you want to succeed . I think that this aspect of trading is skipped by people, money management basics , because it is not "sexy" . After all , how many really interesting accountants do any of us know ? That's what this is really about ; boring numbers and more boring numbers .
With all of that said , it is only boring if you chose to think about it and approach it as such . If you look at this as boring, it will be boring and it's something you won't want to do. If you look at this as an important key to becoming a free forex training professional and you keep focused on the possibility of success ahead if you spend some time thinking your tactics for money management through.... then it can turn into something that is exciting.
Now you're convinced that this area needs to be focused on . Awesome! What is it all about then anyway ? Here are the keys in order of importance , you'll have a great start if you follow them : over leveraging yourself should never be done, the leverage on each trade should be consistent , add to winners and do not add to losers . That's it . There are some tributaries of course to all of the aforementioned but they are incredibly powerful even all by themselves .
When you are trying to figure out why your trading level hasn't advanced the way you wanted it to , keep in mind the money management keys . Another final thing to keep in mind is this: unimaginable psychological benefits can be provided by good money management. And these psychological benefits will improve your trading beyond what you ever thought was possible . Why? If you're not afraid of losing money , or you know you have a solid plan in place that will ensure you're always around to trade another today , then you can look at markets from a state that is relaxed and clear and for your efforts you'll add some serious dividends.
Free forex training can be one of the most challenging and rewarding things ever . Remember that the most valuable keys to your success are often the most simple and probably uninteresting things staring you right in the face . You've wanted to find the trading holy grail - and money management is it .
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
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Tuesday, September 28, 2010
Greece, The Euro, And The EU And Free Forex Training
Free forex training has been quite volatile lately because of Greece's debt crisis. Some are afraid that this problem will spread to other European Union countries that have a lot of debt such as Spain, Portugal and Italy . As a result of what has happened , against the US Dollar the Euro currency has dropped about 11% . When looking at this situation we need to ask ourselves the following questions : Is the end of the Euro sell off here and is the recent strength in the US Dollar a result of strong fundamentals in the United States or of weakness in the Euro ? The reason these are important questions is because the answer to the second one will greatly impact how we answer the first .
My take is that the US Dollar currently is benefiting only because of the weakness of the Euro . Steam has only been picked up in the spending driven US economy because the Federal Reserve for some time has left the rates near 0%. What will happen when the Fed is forced to raise rates ? Will this head wind be something the US economy can really withstand? The answer is likely no . You also have to remember that currently consumers are spending more because many consumers are simply walking away from other payments, such as mortgage, auto, and credit card payments. This means that consumers have income that they usually don't have and so they can spend more money on things such as clothing, new electronic items, and meals out . Again consumers are going at it like crazy. It wasn't sustainable in the last Federal Reserve inflated boom and this time is not different . In the next several years, default or inflation are the US Dollar's only options and both of the options will lead to disaster.
When doing free forex training our goal is naturally to make money . We have no biases. We want a profit from the foresight we have. Thus, the answer to the second question is that the Euro is over sold and will hit a bottom at some point . 1.2300-2400 is probably where it will be . After all , do you really believe that Germany, one of the largest world economies, will allow the failure of their currency ? The answer is, "probably not." This is the reason they aren't printing out more Euros and helping with a Greece bailout . The Euro will be a more sound currency because of what is happening in Greece . The investors world wide will realize that the Euro is a safe option because when they face problems they take the short term loss in order to preserve long term health . Thus , their economy may be having a tough time , but all of this will make their monetary unit better . The situation in the United States is just the opposite. Short term problems are being solved by printing more money, but this leads to problems with the health of our economy and the US Dollar.
After looking at all that , we are close to the point where you'll get the Euro for a great bargain that you need to jump on as you do your own free forex training. Not only for the reasons we've talked about , but market psychology tells you this as well . Professionals buy when there is a free fall in the market just as the average person is catching wind of the crisis and comes in off the street to go short the move that has already happened . This pattern has happened many, many times , and this will continue to occur as long as human physiology includes limbic systems.
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
My take is that the US Dollar currently is benefiting only because of the weakness of the Euro . Steam has only been picked up in the spending driven US economy because the Federal Reserve for some time has left the rates near 0%. What will happen when the Fed is forced to raise rates ? Will this head wind be something the US economy can really withstand? The answer is likely no . You also have to remember that currently consumers are spending more because many consumers are simply walking away from other payments, such as mortgage, auto, and credit card payments. This means that consumers have income that they usually don't have and so they can spend more money on things such as clothing, new electronic items, and meals out . Again consumers are going at it like crazy. It wasn't sustainable in the last Federal Reserve inflated boom and this time is not different . In the next several years, default or inflation are the US Dollar's only options and both of the options will lead to disaster.
When doing free forex training our goal is naturally to make money . We have no biases. We want a profit from the foresight we have. Thus, the answer to the second question is that the Euro is over sold and will hit a bottom at some point . 1.2300-2400 is probably where it will be . After all , do you really believe that Germany, one of the largest world economies, will allow the failure of their currency ? The answer is, "probably not." This is the reason they aren't printing out more Euros and helping with a Greece bailout . The Euro will be a more sound currency because of what is happening in Greece . The investors world wide will realize that the Euro is a safe option because when they face problems they take the short term loss in order to preserve long term health . Thus , their economy may be having a tough time , but all of this will make their monetary unit better . The situation in the United States is just the opposite. Short term problems are being solved by printing more money, but this leads to problems with the health of our economy and the US Dollar.
After looking at all that , we are close to the point where you'll get the Euro for a great bargain that you need to jump on as you do your own free forex training. Not only for the reasons we've talked about , but market psychology tells you this as well . Professionals buy when there is a free fall in the market just as the average person is catching wind of the crisis and comes in off the street to go short the move that has already happened . This pattern has happened many, many times , and this will continue to occur as long as human physiology includes limbic systems.
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
Tuesday, September 14, 2010
Enjoy Portfolio Benefits With Free Forex Training
Free forex training can be done in so many different forms and for so many reasons that is often a daunting task just to figure out where to start . Should you go with an account with a specialized FX trading brokerage, or should you open an account at a brokerage that allows you to trade stocks, options, exchange traded funds, and futures ? Like this decision isn't overwhelming enough, then you have to go on to figure out whether to use FX trading as a speculative or hedging tool, long or short term, etcetera. Before you start there are definitely many things to consider .
While the questions posed in the paragraph above are enough to illicit a multi-volume response , for clarity's sake we'll look at the basics in this article. The easiest way to get comfortable within this world of FX trading is to go ahead and open your account with a fx trading specialist brokerage . What broker should you choose ? That is a topic that is better left for another article. Before depositing money, just be sure to do some due diligence!
Once your free forex training is working and you are getting started , you need to get a firm handle on what exactly it is you're participating in . In this example , we're suggesting that because you opened your account with a broker specializing in forex trading, you'll begin by trading cash or spot contracts. Without getting too complicated , this just means you are trading the current price as it is in the market at that moment . If 1.3200 is what you see the Eur/Usd pair is trading on the screen that means that you can sell Euros against US Dollars at that rate or you can sell Euros and buy US Dollars at this rate. Of course there will be a small spread built into the price you see and when you take the trade this will be the cost of entry. Try finding a broker that only has a spread of 2-3 pips and no more.
Since speculating can be quite challenging at times , even for those that are professionals, let's say you want to in the United States have the goal of hedging your stock portfolio . Because your stock portfolio is in U.S. dollars you may make money if your stocks go up in value in US Dollar terms but a weakening US Dollar could cancel those gains . This aspect of your portfolio is what you want to hedge and you have decided in your brokerage account to purchase Euros against US Dollars . This way as the US Dollar gets weaker against the Euro and your stock portfolio is suffering as a result of the generally weaker Dollar , your forex gains that you are experiencing as a result of buying Euros are serving to hedge your downside risk .
This is probably one of the simplest and best ways to add a free forex training component to the portfolio you have . Other articles in the future will discuss more about global market speculation methods that are more advanced, but this is a great place to start .
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
While the questions posed in the paragraph above are enough to illicit a multi-volume response , for clarity's sake we'll look at the basics in this article. The easiest way to get comfortable within this world of FX trading is to go ahead and open your account with a fx trading specialist brokerage . What broker should you choose ? That is a topic that is better left for another article. Before depositing money, just be sure to do some due diligence!
Once your free forex training is working and you are getting started , you need to get a firm handle on what exactly it is you're participating in . In this example , we're suggesting that because you opened your account with a broker specializing in forex trading, you'll begin by trading cash or spot contracts. Without getting too complicated , this just means you are trading the current price as it is in the market at that moment . If 1.3200 is what you see the Eur/Usd pair is trading on the screen that means that you can sell Euros against US Dollars at that rate or you can sell Euros and buy US Dollars at this rate. Of course there will be a small spread built into the price you see and when you take the trade this will be the cost of entry. Try finding a broker that only has a spread of 2-3 pips and no more.
Since speculating can be quite challenging at times , even for those that are professionals, let's say you want to in the United States have the goal of hedging your stock portfolio . Because your stock portfolio is in U.S. dollars you may make money if your stocks go up in value in US Dollar terms but a weakening US Dollar could cancel those gains . This aspect of your portfolio is what you want to hedge and you have decided in your brokerage account to purchase Euros against US Dollars . This way as the US Dollar gets weaker against the Euro and your stock portfolio is suffering as a result of the generally weaker Dollar , your forex gains that you are experiencing as a result of buying Euros are serving to hedge your downside risk .
This is probably one of the simplest and best ways to add a free forex training component to the portfolio you have . Other articles in the future will discuss more about global market speculation methods that are more advanced, but this is a great place to start .
David F Dacosta - Is a private trader using technical analysis to do free forex training & futures trading. David makes specific trade recommendations for a small select group of traders. He uses drummond geometry to make his forecasts. Click Here for training materials and a free forex trading forecast.
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