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Evening DailyFX Radio PodCast
Key Points
· US Dollar Plummets and Euro Sets Record Heights, no end in sight?
· Can Monday's ISM Manufacturing Report provide a dollar booost?
· Be sure to view the rest of the week's event risk on the DailyFX Weekly Calendar
To discuss these or any other FX topics with the DailyFX analysts, check out the Forum
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Institutional investors continue to hold their bearish bias toward the USD/CAD, and the pair continues to fall.
Institutional investors are net short the USD/CAD and their sentiment becomes more and more bearish with each passing week. The USD/CAD may not stay at parity for long.
For more information on the PFX COT Sentiment Indicator, click on the following link:
http://www.pfxglobal.com/index.php?o...785&Itemid=191
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The US dollar hit multi-decade lows on a trade-weighted basis, with the Euro at all-time highs and the Canadian dollar strongly past parity against its US namesake. Traders asked themselves whether we will see an end to protracted greenback weakness, but early signs suggest that the dollar may fall further before setting any meaningful lows. Continued disappointments in economic data and overwhelming dollar-bearishness have thus far prevented a worthwhile rebound.
Continued calls for a top on the Euro have fallen on deaf ears, with the single currency setting fresh record-highs of $1.4247 through the New York afternoon session. Persistent dollar selling pushed the trade-weighted Dollar Index to its lowest in 15 years, with the British Pound likewise rallying an impressive 160 points to $2.0435. The downtrodden Japanese Yen remained sold against most foreign counterparts, but the dollar nonetheless shed ¥0.85 to ¥114.76.
Morning US economic data only intensified dollar selling pressure, with University of Michigan Consumer Confidence figures and Personal Income results failing to inspire confidence in the greenback. A positive surprise in Personal Spending was largely offset a slightly weaker-than-forecast Income measure. Consumption grew by 0.6 percent through August, matching its fastest rate of growth since April. Yet Income growth decelerated to 0.3 percent through the same period?pushing the Savings rate to a paltry 0.7 percent. Given overall fears of growing consumer debt, such a result will hardly improve sentiment on the future of lending market performance. Yet one month is hardly the signal of a new trend. July's 0.9 percent savings rate had matched February's highs of 0.9 percent.
source:
http://www.forexfactory.comTags:
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The Tankan index will be significant on Monday local time as it will have a significant impact on economic optimism and interest rate expectations
The Bank of Japan remains concerned that interest rates are too low from a medium-term perspective. The difficulty for the bank is that the economic data has made it difficult to a further policy tightening.
The headline inflation index, for example, has remained subdued with core consumer prices falling 0.1% in the year to August.
Evidence of a robust economy would make it much easier for the bank to raise interest rates and a strong Tankan index could give the bank a green light for an October interest rate increase.
The latest industrial data was stronger than expected with a 3.4% production increase for August.
The survey evidence has been very mixed over the past few weeks. The monthly Tankan index fell to a two-year low while other surveys have suggested that confidence strengthened during the third quarter
Overall, with markets expecting a slightly lower reading from 23 last time, the yen should strengthen significantly if there is a headline Tankan reading above 25.
In contrast, the yen will tend to weaken on a figure below 20. The net risks suggest that the yen will react more strongly to a higher than expected figure.
source:
http://www.forexfactory.comTags:
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Introduction
The following is a list of questions you may like to ask yourself, your broker and other traders about a particular firm you have in mind. You can use this checklist to narrow down your selection of forex companies to fit your requirements. You might also like to read the forex broker ratings page on this site to see how other traders are rating and reviewing other brokers.
1. Word of Mouth
- What do other traders say about the broker?
- What is their customer service/dealing desk like?
2. Safety of Funds
- Is the broker regulated?
- What regulatory organisation are they registered with and what protections does this afford you?
- Are client funds insured against fraud at the firm?
- Are client funds insured against bankruptcy of the firm?
3. Execution
- What business model do they operate? i.e. Market Maker, ECN or NDD?
- How fast is their order execution?
- Are orders manually or automatically executed?
- What is the maximum trade size before you are put on manual execution?
- Are all clients trades offset?
4. Spread
- How tight is the spread?
- Is it fixed or variable?
- Is it larger for mini accounts?
5. Slippage
- How much slippage can be expected in normal and fast moving markets?
6. Margin
- What is the margin requirement? e.g. 0.25% (max 400:1 leverage), 0.5% (max 200:1 leverage), 1% (max 100:1 leverage), 2% (max 50:1 leverage), etc.
- Does it change for different currency pairs or days of the week?
- Is it the same for standard and mini accounts?
7. Commissions
- Do they charge commissions? (Most market makers commissions are built into the spread, whereas ECN's charge a small fee)
8. Rollover Policy
- Is there a minimum margin requirement in order to earn rollover interest?
- What other requirements or conditions are there for earning rollover interest?
9. Trading Platform
- How reliable is it during fast moving markets and news announcements?
- How many different currency pairs can you trade?
- Do they offer an Application Programming Interface (API) for automated trading systems?
- Does it offer any other special features? (e.g. One click dealing, trading from the chart, trailing stops, mobile trading etc.)
10. Trading Account
- What is the minimum account opening balance?
- What is the minimum trade size?
- Can you adjust the standard lot size traded?
- Can you earn interest on unused equity in your account?
Source:
http://www.goforex.netTags:
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WASHINGTON (Thomson Financial) - Financial markets are showing 'tentative signs' of recovery from their upset, St. Louis Federal Reserve Bank President William Poole said today, but 'financial fragility is obviously still an issue.'
He warned that 'if the upset were to deepen in a sustained way, it might have serious consequences for employment stability.'
And further Federal Reserve action might be needed, Poole told a New York City audience, because as of now, 'we just do not know what the consequences may be.' His text was released to reporters.
'My best guess,' the St. Louis Fed president said, 'is that the inherent resilience of the US economy along with future policy actions, should they be desirable, will keep the economy on a track of moderate average growth and gradually declining inflation over the next few years.'
Most of Poole's talk was devoted to explaining how central bankers think differently from people in the financial markets. The goal is a kind of equilibrium in which 'the market behaves as policymakers expect and the central bank behaves as the market expects.'
But, since it began publicly explaining its decisions in 1994, the Fed has 'almost constantly grappled' with disclosure.
In part, Poole believes, that's because people in the press and the financial markets are usually asking the wrong question. 'What is important is not the policy action at the next FOMC meeting,' he said, 'which is typically what people want to know, but the policy regularity that will extend across many FOMC meetings, which is what people should want to know.'
And as he said is his policy, Poole refrained from 'being committal' about what the Fed might do at the next FOMC meeting.
Source:
http://www.forexfactory.comTags:
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DETROIT (AP) - Republican presidential candidate John McCain told an audience Friday in an area hard hit by plant closings and job losses that he's optimistic about opportunities in a global economy even as he acknowledged it won't solve every worker's woes.
'Globalization is here, globalization is an opportunity, but globalization will not automatically (benefit) every American,' McCain said in a speech at the Hispanic Business Expo and Economic Summit.
'We must remain committed to education, retraining and help for displaced workers, regardless of whether their job went away because of trade, technological innovation or shifts in consumer spending patterns.'
McCain credited Hispanic entrepreneurs with helping to power the economy. He said nearly three quarters of Hispanic business owners 'staked their personal savings on their success,' and only 1.5 percent secured a government loan. That, he said, represents the lowest percentage of any group in the U.S.
He said that entrepreneurial spirit is important in Michigan, where automotive industry cutbacks have led to the nation's highest unemployment rate.
'Economic freedom is at the heart of our ability to transform tough times to boom times,' he said. 'We have succeeded in the past. We will do so again.'
McCain also used Friday's speech to sound broader economic themes, such as his support of repealing the alternative minimum tax and flattening the tax structure.
Source:
http://www.forexfactory.comTags:
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