Forex And You

Why are we successful at forex trading when so many are not? It's easy, we stick with our system. We have a plan and we do not deviate. Sometimes we go days and days without a trade. We want to trade as much as the next guy but we learned our lesson. It was an expensive forex lesson. We have learned the art of trading. We trade when the trades present themselves. Simple.

Do you get a rush out of currency trading? Do you get excited when you "win" a trade? Are you depressed when you "lose" a trade? If so then this business is not for you. Emotion is the root of all forex evil. Every trade we place will either make pips or lose pips. We know that don't we. If the set up is strong as is all of our trades then in the end we will be profitable. No if, ands, or buts, we will be succesful. This is how to make a career in forex. It is not gambling therefore no wins or losses. Just solid Grail trades!

The Week Ahead

Here are some events to look for this week as you prepare your forex trades:

Monday: The Conference Board's index of leading economic indicators is due in the morning. LEI is expected to have risen 0.7% in August after having risen 0.6% in July, according to a consensus of economists surveyed by Briefing.com.

Tuesday: The Federal Housing Finance Agency (FHFA) releases its July home price index after the start of trading. The index is expected to have risen 0.5% after rising 0.5% in June.

The Federal Reserve begins its two-day interest rate policy setting meeting with a decision expected Wednesday afternoon.

Wednesday: Treasury Secretary Timothy Geithner is set to testify before the House Financial Services committee on regulatory reform, starting at around 9:30 a.m. ET.

The Fed is widely expected to hold the fed funds rate, a key short-tem interest rate, at historic lows near zero on Wednesday, with an announcement due at 2:15 p.m. ET. But investors will be more focused on what the bankers say about their "exit strategy" as they seek to wind down programs that pumped trillions into the economy to cushion the blow of the recession.

The weekly crude oil inventories report is also due in the morning.

Thursday: The existing home sales report from the National Association of Realtors (NAR) is due shortly after the start of trading. August sales are expected to have risen to a 5.33 million unit annual rate from a 5.24 million unit rate in July. July sales were up 7.2% from the previous month, the largest monthly gain on record, going back to 1999.

The weekly jobless claims report from the Labor Department is due before the start of trading. 550,000 Americans are expected to have filed new claims for unemployment, versus 545,000 claims the week before. Continuing claims, a measure of people who have received benefits for a year or more, likely fell to 6.188 million from 6.230 million the week before.

Also Thursday, the G-20 summit in Pittsburgh gets underway. The Group of 20 leading developed and emerging countries will discuss the ongoing efforts to stabilize economies after the financial market meltdown.

Bull Market to continue?

Great article on cnn about the stock market and the economy that I thought I would share. These things play a big part in our forex trading business. All news in the financial markets is important news!

NEW YORK (CNNMoney.com) -- With little on the docket to challenge investor optimism, the defiantly bullish stock market is looking to extend its staggering run in the week ahead.

And why not? Wall Street has shaken off pervasive calls for a September selloff and warnings about the still-struggling economy, managing frequent, fresh 2009 highs of late. The Dow Jones industrial average, the S&P 500 index and the Nasdaq composite have all ended higher in 9 of the last 11 sessions.

The petering out of certain government programs in the last two months of the year and the possibility that third-quarter financial reports will disappoint are real concerns -- so is the reality of a still-brutal job market and change in consumer attitudes toward spending versus saving. But these longer-term worries aren't likely to dominate in the week ahead.

"As long as the economic news keeps pointing up, the market is likely to post more gains in the near-term," said Michael Sheldon, chief market strategist at RDM Financial Group.

"However, given the rate of ascent in recent days, investors should be prepared for a pullback before too long," he said. "Anything that could disrupt the positive outlook could spell trouble."

Since bottoming at a 12-year low March 9, the S&P 500 has gained 58% and the Dow has gained 50%. Since bottoming at a six-year low, the Nasdaq has gained 68%.

The advance has been driven by extraordinary amounts of fiscal and monetary stimulus and a growing sense of optimism about the economy.

But that optimism may be misplaced, said Robert Loest, portfolio manager at Integrity Funds, and he said stocks could be in for a bigger selloff a few months out. "I don't think we've seen a rebound of this magnitude following a crash and I'm suspicious."

"This is not the time for investors to be getting into stocks but to be taking profits," he said. "I think this rally can go another five weeks or so, but not three months or six months."

Bernanke

So Mr. Bernanke says it looks like the recession is over. Everybody must rejoice. The forex trading world should rejoice. Just kidding. Big Ben sure likes to state the obvious doesn't he.

The question all forex traders should be pondering is what will the US Fed do with the interest rates? Will they start gradually raising them? Will they leave them alone? Where will the currencies go? The next year or so should be quite interesting to those of you that pay attention to the world feds and how they read and react to the improving economy. Growth in the economies of the world is not going to blow anybody over but we should start to see steady but slow growth. Watch how the feds of the world react to the new world economy. It should be interesting and probably quite comical. Forex traders get ready, should be an interesting next 12 months.

Oil

Oil jumps 3%. Nothing to worry about right? As I have said before the oil bubble was caused by oil traders and not tied to consumption, production, etc. The speculators are back at it again. They see the economy getting a bit stronger so what happens? Oil starts jumping up again. $100+ a barrel here we come again! It's like a vicious cycle. Do I care? No. I trade currency. I trade forex and it doesn't matter if oils up or down, if stocks are up or down or even if the economy is in the tank or flying high. Currencies move every day. The FXGrail trades when it trades and I make more currency. Simple folks!