Forex Trading Strategies- The Long Term Trading Approach

By forexreport

With a host of strategies employed in Forex Trading , the question is where do we start?

The first strategy I would like to discuss is a longer term one, in the time frame of a few weeks to a few months. This particular strategy will exploit the fact that a country currency value will appreciate with a hike in the interest rate and vice versa.

Based on the macro economic conditions of a country, the central bank shall decide which of the two, inflationary pressure or market downturn (credit crunch, poor employment data) is of a greater concern to the economy of the country. If the concern on high prices outweighs bad economic situations, then the central bank will hike the interest rate.

If the central bankers are more worried about the credit crunch in the markets than inflation, then the central bank shall go into rate cutting exercise. Normally, central bank will have the same bias in a direction for at least a few weeks or months. The central banks of most countries would not be changing its bias abruptly once a decision is made and announced to the world. Therefore, a central bank will continue to raise it interest rate in a row. The opposite is true for a rate cutting exercise.

So the strategy is to look for economies that are in rate hiking direction and another one in a rate cutting direction. Then long (buy) the currency of the country having the rate hiking tendency and short (sell) the currency of the country having the rate cuts. Beware that this strategy is for longer term, therefore, it is prudent to use extremely low leverage or no leverage at all. The advantage of this strategy is that a trader does not need to monitor the market every single minute other than keeping abreast about the relevant countries monetary / fiscal policy may be once a day.

Observe the rise in rate of Euro against USD in the chart below while USA FED was in the rate cutting mode and then European Union Central Bank was in rate hiking mode in the chart below. European Union Central Bank started the rate hiking exercise from 2005, raising the interest rate from 2.00 to 4.25. So make sure that you look back at the rate cutes and you will see how this affects the movements in currencies.

What if now all countries are in rate cutting mode? How can this strategy work? The exchange rate is determined by the relative value of each currency. Therefore, a potential twist to this strategy is to determine which country is having higher interest rate now, and therefore having the higher potential of bigger cuts than those having low interest rate. With the economic slowdown we are seeing countries cutting rates, all over the world. So make sure you pay particular attention to what is happening. The strategy is then to short (sell) a currency with higher interest rate, where the country is likely to cut interest rate (again) and long the currency having low interest rate. One good example (for discussion purpose only and not a recommendation for trade) of country having high interest rate is Australia. It started rate cutting last year from 7.5% to 6.5%. If credit crunch is getting worse in Australia, the potential of big rate cut is obviously higher than Japan that is having an official interest rate at 0.3 For more information or strategies feel free to CFD FX REPORTIt is a real time trading tool that offers clients free trading reports, with trading ideas, stock market and forex market education as well helping them with. Also if you are looking for a Forex Broker, then feel free to visit our broker section as we recently reviewed all the forex brokers and have found the best on the market. - 23210

About the Author:

is a real time trading tool that offers clients free trading reports, with trading ideas, stock market and forex market education as well helping them with. Also if you are looking for a Forex Broker, then feel free to visit our broker section as we recently reviewed all the forex brokers and have found the best on the market.

Silver Peace Dollar Coin - A Silver Showcase For Liberty

By Christina Goldman

Those devotees of the study or collection of currency and other members of the numismatic community will find their hearts warmed, knowing that the Silver Peace Dollar Coin issuance was inspired by their interesting and widespread hobby.The Peace Dollar was minted by the The U.S. Mint during a seven-year period, from 1921-1928.

Its inspiration originally came from a November 1918 article in The Numismatist, the official publication of the American Numismatic Association (ANA), which suggested the minting of a coin to mark the end of World War I and the triumph of democratic ideals.

This suggestion was further expounded at the ANA convention in Chicago in August 1920. It called for either a half-dollar or a dollar commemorative coin to provide ample space for a design showcasing liberty, prosperity, honor and democracy. US Treasury authorities, however, went a step further and issued the silver as a coin for general-public circulation.

The Silver Peace Dollar coin succeeded the Morgan dollar which was minted last in 1904. The Pittmann Act sponsored by Nevada Senator Key Pittmann enabled the minting of the Silver Peace Dollar, as this federal law authorized US sale of standard silver bullions the proceeds of which will used for minting new silver dollars.

The Peace Dollars designer was Anthony de Francisci who prominently rendered the word "PEACE" at the bottom of coins reverse side. The silver content of this coin is 0.77344, and it is the last silver dollar that was minted for US circulation.

There was brief minting of the Silver Peace Dollar coin in 1965 with the coins bearing the year 1964. For one reason or another, however, these coins were neither circulated to the public nor any of their examples released. The whole 1965 mintage was melted, perhaps along with the hopes of some avid numismatist and Peace coin collectors. - 23210

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Becoming A Successful Day Trader

By DayForex

The share market today is as volatile as we have seen it, as stock prices continue to fluctuate the only way to preserve your money is to sit on the sidelines and the chaos goes on in the financials and other sectors. With the wild swings in the market as it continues at times to make no sense. We have seen days of down 500 points, followed by days of up 450 points, actual trading sessions moving as much as 1000 points. How do we make sense of these crazy markets and more importantly how do we make money.

Do not worry there is a systems out there that will teach you manage your trades. With this type of knowledge you can go from a learner trader to an Expert Trader in no time.

Becoming a successful stock market trader requires learning and having a certain level of knowledge, confidence and the ability to control your fear and greed. Stock Market or Forex Trading is best explained as supply and demand, if a lot of people want the stock it goes up, if they don't want it then it falls. There are endless amounts of research available today from online reports, newspapers, education lessons the list is quiet long so how do you decide when and where to start. The first step you need to take is to decide that you want to become a trader. Then you need to right out your goals and your reasons why.

What you now need to do is to learn and understand that in theory things can seem simple however once you are trading in these at times crazy trading markets things can seem confusing. This is why it all comes back to having the right level of education and knowledge and where possible a great mentor or Broker. Using these steps almost anyone can become a trading success.

To learn more on the stock market or forex market feel free to visit the CFD FX REPORTas they have some excellent education lessons available, and they can also help you find the best online brokers in the market. - 23210

About the Author:

is a real time trading tool that offers clients free trading reports, with trading ideas, stock market and forex market education as well helping them with. Also if you are looking for a Forex Broker, then feel free to visit our broker section as we recently reviewed all the forex brokers and have found the best on the market.

T-Strips = Zero Risk Investment

By Kris Filmalter

T-Strips are an interesting investment tool that really is being used in the current economy more and more due to the safety net it provides. The word "STRIPS" is an acronym which stands for "Separate Trading of Registered Interest and Principal Securities." The thing unique about T-Strips is the fact that the coupons may be seperated from the principal of the coupons and traded seperately as zero coupon securities. This is especially important to banks, corporations, and large investors looking for a safe investment.



History of T-Strips

STRIPS was launched in 1985. The name STRIPS was derived before the computer age, when the paper bonds were physically traded and the traders would tear off the interest coupons literally from the paper securities and resale the broken parts separately.

Under the STRIP program, a financial institution can present the US Treasury with a standard Treasury note, Treasury Bond or TIPS (Treasury Inflation- protected Security) to be "stripped." The Treasury then breaks or disintegrates the individual flows of cash into separate securities, after which it is returned to the financial institution.

For instance, a 10-year note which is just will be stripped into twenty interest payments, two for each year or semi-annually for 10 years and one principal payment which will be due at its maturity date. All twenty interest payments plus the single principal payment are converted to STRIPS, each of them will then become a separate security. The new separate securities are then identified as coupon strips for the interest payments and principal strips for the principal payment. Together they are referred to as Treasury STRIPS.

These Treasury STRIPS are separate zero-coupon securities. Nothing is different about them at all from the zero-coupon securities. In fact, to an investor, there is not a difference between a coupon strip and principal strip, although technically the Treasury STRIPS are not identically the same. In the example given, all the twenty one coupons have its own unique identifying number or the CUSIP number.

The STRIPS program requires that the "stripped" treasury securities are maintained in a book entry form with the fed wire. This enables the "strips" to be easily tracked, therefore making individual trading of the security possible.

Risk-Free Investing Using United States Treastury Strips

The Treasury STRIPS normally mature over ten years out to thirty years. They are backed by the US government which makes them risk-free credits. STRIPS are not issued or sold directly to investors, only financial institutions such as investment banks and brokerage firms; government securities brokers and dealers can hold and purchase it.

STRIPS components can be reconstituted together into a fully constituted U. S. backed security in the commercial book-entry system. For this to happen, the licensed financial agent must get the right principal component along with all its unmatured interest components. When the minimum amounts of the components are brought together, the security is said to be reconstituted.

STRIPS are more popular when short-term interest rates are low. At these times short term bank rates and reinvesting bond proceeds are not desirable. T- Strips, being zero-coupon securities, do not have reinvestment risk. - 23210

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Capped Bust Silver Quarter - Rare Quarter Commands Exceptional Value

By Christina Goldman

The Capped Bust Silver Quarter was the immediate successors of the equally rare draped bust silver quarters which started minting in 1796. These silver quarters were first minted in 1815 and count among the rarest coins ever minted in the United States. These two particular silver quarter types were minted as a replacement for the Spanish two-reales coin circulating in the Americas at that time, by the fledging U.S. government.

The Capped Bust Silver Quarter carried the same design as the other coins, like the half dollar, minted during that time. Production of these quarters went on until 1838, and these coins together with the draped bust quarter, have been named by numismatists as the "Early Quarters" commanding premium prices among coin collectors.

Other key years to look out for when scouting for the Early Quarters are 1823, 1804 and 1796. Notably from 1804 onwards, the reverse side of the Early Quarters sported a bigger, "heraldic" eagle, suggestive of strength and power that collectors and numismatists appreciate over coins of earlier vintage which had smaller eagle designs.

It is a sound advice that before buying a Capped Bust Silver Quarter or any of the Early Quarters, the buyer must have an assurance that these items have certification of authenticity from reputable numismatist groups or associations like the ANACS, NGC, PCGS and ICG. Another is to deal only with reputable dealers.

A useful website for reference on the capped bust silver quarter can be found in the net. This site carries a legitimate eBay auction listing of Early Quarters and their key dates. Through this listing, a prospective buyer could check the trend of the pricing, and compare various price levels within years, comparative data that are useful to the serious collector or dedicated numismatist. - 23210

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