Forex Trading: Investing Basics - EconoTimes

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• Forex Trading: Investing Basics - EconoTimes
• FOREX-Dollar on borrowed time as US twin deficits balloon - Investing.com India
• FA Center: How to win the boring 'loser's game' of investing and still keep the excitement alive - ForexTV.com
• FOREX-Dollar whipsaws as virus mutation rattles traders - Investing.com India

Forex Trading: Investing Basics - EconoTimes Posted: 30 Dec 2020 08:26 PM PST The world's largest financial market, which has a big role in the world's economy, is the foreign exchange also known as the forex market. Each day an average of around $5 trillion is exchanged from one currency to another. This type of currency exchange is crucial for international business. Common participants in the forex market trading are governments, businesses, and investors. Governments use the forex market to apply policies. For example, when a government is doing business with another country, whether it is offering aid, lending or borrowing money that particular government has to convert its currency into a foreign currency. Investors use the forex market to speculate on price changes of the currencies. These prices change almost constantly during the week since the forex market is open from Sunday at 4:00 PM until Friday at 4:00 PM central time. Businesses, on the other hand, use the forex market to make international trade easier. Before proceeding to how the forex market trading works it is very important to be familiar with cfd (Contract for difference) trading. Contract for Difference Trading (CFD) CFD trading allows you to trade on the price movements of any financial market such as commodities, indices, stocks, and currencies without actually owning them. If the price of a certain asset goes up after buying a CFD, the rise of the asset will be beneficial for the investor. This is called "going long". If, on the other hand, if a CFD is bought and the particular asset goes down, the investor can profit by selling the CFD. This is called going short. How Does Forex Trading Work? When you trade currency using the forex market instead of trading one product, you are trading two currencies against each other. This is also known as a currency pair. Although there are two currencies involved, the pair itself is a single entity. This is similar to a stock or a commodity. Investors profit when they buy a CFD for a currency pair with an increasing price. Also, investors will profit if they sell or short a currency pair and the price decreases. Vital Elements of The Forex Market Margin When trading with margin, you will only need to put up a percentage of the total investment to enter into a position. This is called a margin requirement. When you trade other assets like stocks, trading with margin basically means that you are borrowing funds from your broker. In contrast, forex trades can only be done if the investor transfers funds beforehand in their forex account. This means he does not have the option to enter a forex trade by borrowing money from their broker. Forex margin requirements depend on the currency pairs and the size of a trade. Leverage Leverage is the second key element of forex trading. It allows investors to have control over large investments with a small amount of money. While the leverage that is associated with currency pairs is one of the benefits of the foreign exchange it also may be a risk. With leverage, investors can make large profits or large losses. Financing The third important element in the forex market, financing, is the calculation of net interest owed or earned on currency pairs. The financing happens when the investor holds their position after the trading day is over. Keep in mind that when you trade a currency pair, you are trading two currencies against each other. Despite the fact that the currency pair acts as a single entity, you are actually short one currency and long the other. With financing, on the other hand, you are lending the currency that you are long and borrowing the currency that you are short. The lending and borrowing trigger the overnight lending rate of each currency. An investor only receives credit if the currency he has long had a higher interest rate than the other currency. On the contrary, the investor is in debt if the currency he is long has a lower interest rate than the currency he is short. Conclusion With all investment opportunities, the forex market has its own risks and benefits, and therefore gathering knowledge on the forex market and its elements would be the first step for you to consider before starting. This article does not necessarily reflect the opinions of the editors or management of EconoTimes

FOREX-Dollar on borrowed time as US twin deficits balloon - Investing.com India Posted: 30 Dec 2020 08:32 PM PST * Euro clears $1.2300 to be up 10% for year * extends its climb to pass 6.49 per dollar * Dollar index drops to lowest since April 2018 * Sterling firm as lawmakers approve Brexit deal By Wayne Cole SYDNEY, Dec 31 (Reuters) - The dollar was ending 2020 in a downward spiral on Thursday with investors wagering a global economic recovery will suck money into riskier assets even as the U.S. has to borrow ever more to fund its swelling twin deficits. The euro stood at $1.2291 , having hit its highest since April 2018 with a gain of almost 10% for the year. The next stops for the bull train are $1.2413 and $1.2476, on the way to the 2018 peak at $1.2555. The dollar was lying at 103.15 yen , but managed to hold above the December low of 102.86. It also fell against the Chinese yuan, breachingh 6.4900 CNH= for the first time since mid-2018, though Chinese banks were later reported to be buying dollars to limit the drop. held gains after lawmakers approved a post-Brexit trade deal with the European Union, stretching as far as $1.3641 GBP=D3 a level unseen since May 2018. a basket of currencies the dollar had sunk to 89.643 , having touched it lowest since April 2018. That left it down 7.2% on the year, and no less than 13% on the 102.99 peak hit during the market mayhem of mid-March. The next target is 89.277 and then 88.251, which was the absolute low in 2018. The prospect of a brighter 2021 has lessened the need for the safe-haven dollar, while burnishing the attraction of riskier assets especially in emerging markets. Bears have also resurrected the "twin deficits" excuse for shorting the dollar - that the explosion in the budget and trade deficits means more dollars being printed and moved abroad. From this perspective the new U.S. stimulus bill is dollar negative as it adds to the nation's debt, and President-elect Joe Biden is promising a lot more next year. The country is also haemorrhaging dollars on its trade account where the deficit on goods hit a record $84.8 billion in November as imports surged past pre-pandemic levels. Likewise, the current account deficit widened to a 12-year high in the third quarter and there was a large shortfall in net financial transactions as Americans borrowed more from abroad. In contrast, the European Union runs a huge current account surplus, largely thanks to Germany, so there is a natural inflow to euros through trade. "The U.S. dependence on foreign savings is increasing and at 3.4% of GDP, it is approaching a danger zone where it will become increasingly difficult to attract savings without further dollar weakness, or higher interest rates," said Alan Ruskin, global head of G10 FX at Deutsche, in a note. "The deterioration in the 'twin deficits' will do nothing to improve USD sentiment, even if it does not as yet justify extreme USD undershooting either."

FA Center: How to win the boring 'loser's game' of investing and still keep the excitement alive - ForexTV.com Posted: 30 Dec 2020 02:13 PM PST This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.

FOREX-Dollar whipsaws as virus mutation rattles traders - Investing.com India Posted: 21 Dec 2020 05:26 PM PST * Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E By Tom Westbrook SINGAPORE, Dec 22 (Reuters) - The dollar was firm on Tuesday but traded well below peaks hit on a wild ride higher overnight, as a new coronavirus strain in Britain sent jitters through holiday-thinned currency markets. Sterling fell as much as 2.5% to $1.3190 as countries from Europe to Asia sealed off travel links with Britain to try and contain the highly-infectious mutation. liquidity exaggerated dollar gains in other currencies, too, as short sellers bailed out. But moves largely unwound as investors took their chance to buy in to the dollar's downtrend. The pound, helped by a Bloomberg report which said the European Union was considering a compromise on fishing rights - a stumbling block to a trade deal - recovered to trade at $1.3418 in Asia, though it remained on edge as talks progress. The euro recovered to sit at $1.2229 on Tuesday after falling a cent to $1.2130. The yen was steady at 103.30 per dollar and the Australian and New Zealand dollars a little soft with the nervous mood, but well above overnight lows. "The euro found an abundance of buyers on the deep dip," said Stephen Innes, Bangkok-based chief strategist at currency broker Axi. "The 'short dollar' clear-out is probably nothing more nefarious than stretched positioning getting taken out to the woodshed on Brexit scares. However, it shows the potential dangers of universally bearish dollar sentiment," he said. Wagers on a falling dollar as the global COVID-19 recovery lifts world trade and commodity prices, tending to benefit export-driven economies and their currencies, is becoming an increasingly crowded trade as momentum funds pile in. The value of overall bets against the dollar eased a fraction last week, positioning data showed, but remains near nine-year highs struck in September. 0#NETUSDFX= Against a basket of currencies =USD the dollar is headed for a third quarterly loss in a row and is down 12.5% from a three-year peak in March. The was last at 90.145 having been as high as 91.022 overnight. Nerves over the new strain of coronavirus are keeping it above last week's 2-1/2 year trough of 89.723. Together with a new outbreak in Sydney, that held the Australian dollar AUD=D3 at $0.7566, 0.3% lower for the session, despite roaring retail sales figures. said there was no evidence that vaccines would not protect against the new virus variant, but Britain's chief scientific adviser said that in the meantime tighter restrictions on public life in Britain were likely. are looking ahead to confidence data in the U.S. and Germany later on Tuesday and have been cheered by the expectation that stimulus checks could go out to Americans next week. Prime Minister Boris Johnson has warned that there are still "problems" in securing a trade deal with Europe, but financial markets remain hopeful that something can be struck before Britain's exemption from tariffs expires on Dec. 31. bid prices at 9:04AM in Singapore (104100 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR=EBS $1.2232 $1.2248 -0.12% +9.11% +1.2250 +1.2228 Dollar/Yen JPY=D3 103.3300 103.3550 -0.03% -4.88% +103.3550 +103.3200 Euro/Yen EURJPY= 126.39 126.45 -0.05% +3.64% +126.5500 +126.3600 Dollar/Swiss CHF=EBS 0.8857 0.8859 -0.01% -8.45% +0.8862 +0.8855 Sterling/Dollar GBP=D3 1.3421 1.3471 -0.35% +1.21% +1.3467 +1.3418 Dollar/Canadian CAD=D3 1.2858 1.2858 +0.01% -1.02% +1.2864 +1.2845 Aussie/Dollar AUD=D3 0.7568 0.7587 -0.24% +7.87% +0.7590 +0.7567 NZ NZD=D3 0.7083 0.7096 -0.16% +5.29% +0.7105 +0.7084 Dollar/Dollar All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX

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