Category Archives: Forex Trading Articles

How the European Single Currency Affects Currency Transfer Operations

The adoption of the single European currency in late 1999 had a mixed effect on currency transfer operations and the overall economic performance of the European Union (EU). It lowered some costs but spurred doubts about the ability of national governments to control financial markets in times of crisis. Doubts notwithstanding, the euro has already become a major world reserve currency and is bound to grow even stronger if it manages to replace the U.S. dollar as the oil trading currency.

Speaking about currency transfer operations within the EU, one must admit that the introduction of the single currency benefited individual and business clients because it brought the costs of currency conversion across the continent to naught, thus downsizing the cost of currency transfers. However, the adoption of the euro in the Eurozone resulted in a single monetary policy determined by the European Central Bank, which left little room for national governments to manoeuvre in times of trouble. Moreover, different levels of inflation and unemployment levels within the Eurozone and the EU as a whole were among the factors that have recently been fanning the fire of financial troubles in Europe.

Obviously, euro adoption was a factor to strengthen European financial markets in terms of liquidity because businesses and governments have more sources of funding and are not limited by local currency barriers to borrowing money and gave fresh start to European financial markets.

After its introduction in late 1999 the euro started to depreciate against the dollar and following a series of volatile moves in May 2009 it slid to an exchange rate tantamount to its initial trading value. Meanwhile, individual and institutional brokers around the world managed to heavily profit on these currency fluctuations, and transfers entailing conversion from one currency to another was a matter of survival for some companies. Later, the euro continued to gain against the U.S. currency but the recent recovery of the American economy helped the dollar restore its positions and now it is evident that it finally lost its leading role as the world’s reserve currency.

Many countries already switched to the euro as a reserve currency and even the oil-rich countries of OPEC are considering options to start trading oil in euro. Such a move will most likely initially shake the financial markets because many currency transfers denominated so far in U.S. dollars will be lastingly switching to the euro.

Euro adoption has its disadvantages, too. The major one is that at present national governments within the Eurozone can only rely on fiscal policy and public investment to adjust economic policy to the needs of specific regions and countries. In times of financial crisis and dangerously high budget deficits across Europe, countries like the United Kingdom, which is not a member of the Eurozone, have more room to act and manipulate the exchange rate of the pound to achieve better economic results. The Bank of England can take measures to devalue the British currency and ease access to cheaper credits, while countries like Greece, which belongs to the Eurozone, is not allowed to do so. On the other hand, positive effects outweigh negatives and most financial analysts are of opinion that the euro has a bright future ahead of it.

Mt4 And Mt5 – A Thorough Comparison to Help You Decide Which to Ake

MetaTrader 5 is the upgraded version of MetaTrader 4 insightfully designed with a vision of helping traders makes more profits. However, they offer different features and benefits to both the Forex trader and broker.

Introduction

MetaTrader (MT) is a special and independent platform used for Forex trading by both Forex brokers and traders. This Forex trading platform is designed for online Forex trading only. To be specific, it is the most popularly used Forex trading platform globally. The MetaTrader platform was developed by MetaQuotes, Russian company in 2002. Its design offers several different options enhancing support and easy tweaking, which makes it popular with several experienced Forex traders. The MetaTrader comes with its own built-in programming language referred to as “What is MQL”. The most popular forms of MetaTrader platforms are MT4 and MT5. MT5 is the upgrade of the original MT4 version.

User Interface And Charting

Both the MT4 and MT5 use pretty much similar account interface and charting options. However, MT4 looks a little more bulky when compared to MT5, which is the primary difference. The new version MT5 is designed with more spaced-out icons featuring large buttons. This is greatly helpful as compared to the compact nature of the older version. However, the disadvantage is that it takes up much of the precious space in terms of pixels. Actually it wastes the useful chart space. The Fibonacci Retracement tool works well in MT4 as compared to this new version.

Hedging

Every Forex trader is concerned about the hedging feature. Unlike the predecessor, the MT5 does not work well for hedging. For example, traders using MT5 cannot hedge out when trading on two systems say swing system and scalping system. Through hedging, you can take advantage of an opportunity for quick scalping and make some cash by going short with just few pips. However, that seems impossible with MT5. It is suggested that Forex brokers can facilitate hedging on MT5 using plug-in.

Computer Space And Other Resources

Unlike MT4, this new version takes lots of computer space. As compared to MT4, the MT5 consumes more than triple the RAM space. But this varies significantly depending on the computer. Even though it consumes more computer space, the new version is preferred because it provides the most resources for online Forex trading. Besides, MT5 is very efficient and designed to offer more features which are undoubtedly resourceful.

Indicators and EAs

The best feature of MT5 is its introduction of folders particularly in the navigator windows. Actually this is a neat feature developed to help traders easily organize expert advisors and indicators. The MT5 provides four folders for Oscillators, Volumes, Trend, and Bill Williams under the indicators section in the default installation. The trader can easily open any of these folders, select and apply the appropriate indicator. In addition to these, you can also create your own custom folders. However the worst news is that MT4OEs Expert Advisors and indicators cannot work for MT5 platform.

Backtesting

By now, MT5 platform is not compatible with the Strategy Tester. Therefore a trader is not able to backtest anything. However, this feature may be implemented so that traders can effective backtest while trading. In case they include backtesting, it should be better than that of MT4. Backtesting was significantly the weakest point o MT4.

Conclusion

Both the MT4 and MT5 are designed to perform the same function but are slightly different in terms of features and options offered. Both the Forex traders and brokers enjoy different levels of benefits from these outstanding differences. Although people had high expectation about the new version MT5, it is a hell of problem disappointing many. Most Forex traders prefer to work with MT4 considering the new version a letdown. Specifically, MT5 platform hinder trader from taking advantages of several opportunities to gain potentially. The good news is that it is still under test and improvements are expected sooner.

Buy Iraq Money or 10000 Dinar to Get Huge Returns

Investment in currency is the short-cut method to earn huge amount of money. You can earn big bucks by investing money to Buy Iraq Money. However, if you wish to Buy Iraq Money there are few things which you need to know. They are: the current exchange rate of Iraqi currency and whether the rate is reliable. Being a common man it is obvious that you may not be aware of the current market conditions and therefore, you will have to depend on a Dinar dealer. Since you are new to the currency market you must be very careful when you Buy Iraq Money because the currency market is full of fake money and fake dealers who can cheat you without letting you notice it.

Currency trading always involves risks and therefore when you Buy Iraq Money it is advisable to gather all information regarding buying Iraqi currency and hire a reliable and trustworthy Dinar dealer. Dealing with an authentic and reputed dealer in order to Buy Iraq Money minimizes the risk factor to a great extent. All information about how to Buy Iraq Money and how to get a good and authentic Dinar dealer is available on the Internet.

Investment in 10000 Dinar has gained much popularity and there are signs that people will be able to earn huge returns in the future because the conditions of Iraq are improving due to the oil reserves found there. Although, many international companies have reached there to capitalize the oil reserves but still there are many places which remain unutilized because they are unknown. Therefore, there is a need for some government policy to capitalize the oil reserves by conducting search programs. Once this is done, nothing can stop Iraq conditions from getting better. This proves that investment in 10000 Dinar is lucrative and people can earn huge returns in future.

The value of 10000 Dinar is low at present but once its oil reserves are found the value of Dinar will touch the sky. Therefore, it is advisable to buy 10000 Dinar now and sell it when its value increases so as to earn big bucks. It may take years for Iraq currency to rise in value but it is better to buy 10000 Dinar now because later you may find it difficult to buy.

Thus, Buy Iraq Money or 10000 Dinar to get huge amounts of money but it is important to deal wisely.

How to Avoid Requotes in Forex – 2 Things You’ll Need to Keep in Mind

How to avoid requotes in forex is an important question that plays a very vital role in every forex trader’s career. Before you can actually kill the causes of the forex requotes, you must have crystal clear concept about requotes. Your trades are not executed immediately when you order them, rather they are sent to your broker who then later on executes them. There is always a difference between the order time and execution time (due to many reasons), even if you place a market order. As the forex market is very fast moving market, so there are chances that the prices may move between your order and execution time, which is then compensated by you or your broker in the form of requotes. Hence it is very important that you should keep avoiding these forex requotes to remain on the safe side. Now you will find two best ways to avoid forex requotes.

Place stop loss orders to avoid forex requotes

A stop loss order is an order that will help you in avoiding further loss (stop loss). In a stop loss order, your broker will complete your trade when the currency price reaches a certain price level that is determined. When the already determined price will be reached, your order will be executed immediately by your broker.

You can place many various types of stop orders like, buy stop order, sell stop order, stop limit order and others. You can place any of the stop orders considering your risk management strategy. This is one good way to avoid losses in the forex market. It is highly recommended that you shouldn’t use automated stop loss orders provided by your trading software.

Place a take-profit order

When we talk about how to avoid requotes in forex, take-profit order or T/P order is very helpful. A take-profit order is the one which will be executed when the price of the currency reaches a certain level above your declared price. This particular order is specifically used to grab extra layers of profit.

As a forex trader you must know when you should use a take-profit order. You can use take-profit order when you are sure that the price of the currency will rise.

For instance, you bought a currency A at $ 110 and you are sure that the price per unit will rise up to $ 111.10, but you are not sure that what would be the price movements after $ 111.10. In such a scenario, you should use a take-profit order. In the above example, you need to place the order at $83. Hence, when the price of the currency will reach $83, trade will be executed.

Being a forex trader, you will always be playing with currency prices. In order to increase your profit, you simply need to keep avoiding forex requotes. I am sure after reading above mentioned details, you can answer any beginner trader quite easily that how to avoid requotes in forex. Remember trading is all about learning and applying, so keep doing both.

Looking at The Best Forex Indicators to Maximize Profits

If you are a novice who has just started trading foreign exchange with the desire to make plenty of money, you should first be aware of the best forex indicators in different categories and their application. If you’re already into this form of trading for quite some time, you should be familiar with the proper combining of forex indicators that can aid you in earning steady profits in the currency market. There are four categories of indicators that are widely utilized by traders and mentioned below.

The first category of the best forex indicators is momentum indicators that are known as strength indicators as well. They indicate the rate of fluctuation of price over a specific time frame. They are similar to oscillators that are able to show whether the foreign exchange market is going through oversold or overbought conditions. In case the indicators attain the overbought area, it signifies that there are tremendous possibilities for the price to descend. On the other hand, if they get to the oversold area, it implies that there is greater chance for prices to ascend. Some of the most popular momentum indicators include Commodity Channel Index (CCI), Relative Strength Index (RSI) and Stochastic.

Devised by Donald Lambert, the CCI indicator is hugely popular for its amazing potentiality and simplicity. The original CCI comprises a solitary line that hovers between +200 and -200. Traders can use it to recognize bullish and bearish market oscillations as well as to determine turning points, strongest and weakest time frames in the market. Experts recommend making use of CCI for entries and exits as soon as the indicator attains +100 or -100.

Trend indicators are the second category of the best forex indicators. Traders should bear in mind that trend is their most trusted companion and they should trade in the direction of the trend only. There are many different trend indicators like Moving Averages, Moving Average Convergence Divergence (MACD), Parabolic SAR, Average Directional Index (ADX), etc. They assist traders in identifying when the trend starts or stops.

The volume indicators are utilized for portraying the amount of trading which happens and reasserting the direction of the trend, a breakout or reversal. The price will go up when the trade volume elevates and low volume may possibly show the reversal in currency trading. If the currency pair is traded in thin range and attains a soaring volume, it shows a breakout. Some widely used volume indicators include Money Flow, Acceleration Bands and Demand Index.

Finally, the fourth category of the best forex indicators is volatility or bands indicators. The alteration in volatility will bring forth an alteration in price. Therefore, traders can discover the activeness of the currency market by observing the price ranges. You shall make an entry into trade if there is favorable fluctuation in price movements that indicate the FX market is active. The most widespread volatility indicators are Bollinger Bands, Average True Range (ATR) and Chandelier Exit.