EURUSD broke 4 year support level at 1.2400 during 14 May US session.

This is a signal that EURUSD is going to fall further down. The next support level is at 1.1800 which means there is a potential gain of 500 pips to be made.

Shorting EURUSD will be of interest next week.




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Risk Disclosure: Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to participate in the futures trading markets. Don't trade with money you can't afford to lose. The past performance of any trading system or methodology is not necessarily indicative of future results.

We have closed to 3000 Pips Profit since the start of year 2009. This is also a great achievement for our students and subscribers who have taken the commitment to learn forex trading from Practical FX Trading

We do not have 100% success rate in our forex trading program. But we have more Profits than losses, this shows that we have a proven forex trading strategy.

Our track record as follows. As usual more PROFIT than loss

PROFIT 490 pips generated in the month of September 2009
PROFIT 327 pips generated in the month of August 2009
LOSS 228 pips generated in the month of July 2009
PROFIT 1259 pips generated in the month of June 2009
PROFIT 24 pips generated in the month of May 2009
LOSS 313 pips generated in the month of April 2009
PROFIT 345 pips generated in the month of March 2009
PROFIT 525 pips generated in the month of February 2009
LOSS 317 pips generated in the month of January 2009

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The first thing you have to remember is not to buy a course that will teach only the basics of Forex. You can easily get such information for free. Even your broker can provide free basic trading courses and tutorials.

You will only waste your money on courses that teach you how to trade, how to read charts, and other information that you can get for free. Most probably, these courses are just written by authors who compiled different Forex information and sold them as a Forex course.

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Stephen Roach, chairman of Morgan Stanley Asia, sees 2009 as a year of "severe global recession," inflation, and declining earnings.

"The key call investors will have to make is not so much on the shape of the recession, but what the contour of the subsequent recovery is likely to be," Roach told the Financial Times.

The markets will likely bet on a normal recovery, especially considering the huge amount of money the United States and European governments are pumping into their economies, Roach said.

President-elect Barack Obama is said to favor quick passage of a $775 billion stimulus bill that will be disbursed over two years. Talk of up to $1 trillion in combined spending and tax breaks has surfaced on Capitol Hill.

"Hope springs eternal that a relatively short-lived downturn will be followed by a pretty solid U-shaped recovery," Roach said.

Yet Roach isn't buying that idea.

"To the contrary: my strongest out-of-consensus idea for 2009 is a realization that the world is now facing a multi-year slowdown," Roach predicts.

"Any recovery in 2010 will be tentative and anemic."

Roach is betting that the American consumer is finally completely out of the game, although he doesn't discount a short-term stock rally. A very slow U.S. recovery will keep the rest of the world waiting for recovery as well, he warns.

In fact, discounter Wal-Mart might be the only retailer to report a rise in December sales, according to Thomson Reuters. Full numbers are due out today.

Two well-known economists know predict unemployment in the United States of greater than 11 percent — a number which would mean up to 7 million more people out of work. The November jobless rate, the latest data point available, was 6.7 percent.

Carmen Reinhart, from the University of Maryland, and Kenneth Rogoff, of Harvard, figure housing might not bottom until 2010, which they say bodes poorly for struggling banks that still hold trillions of dollars in mortgages.

"Financial crisis are protracted affairs," Reinhart and Rogoff wrote in a paper presented at this weekend's annual meeting of the American Economic Association, in San Francisco.


My View?

I agree with Mr Stephen Roach that we are in a multi-year slowdown. If you are thinking of investing in stock market in 2009, I say think twice.

In my opinion 2009 is a year of opportunity for forex and commodity trading, because in forex and commodity trading we can tap on market downturn.

Since the chaos on the stock markets has begun one of the most popular forms of trading this year has been currency trading and for good reason. Even though investments like stocks may lose across the board, with forex trading, there is always money to be made if you pick the right trend and currency at the right time.

Additionally, because of the nature of currency trading, there is always money to be made in any situation. For example: If you think the euro is going down against the dollar, but up against the pound, you can enter two different positions — one favoring the euro and one shorting the euro — and possibly make money on both. Of course, there is an equal possibility that you will be wrong and lose money on both positions but we Forex Traders got the right risk appetite for this kind of trades.

Now lets see which form of trading will be the most popular in a few years. Will Forex Trading beat the Stock Market and become the number one?

Currencies are quoted in pairs, such as EUR/USD or USD/JPY. The first listed currency is known as the base currency, while the second is called the counter or quote currency. The base currency is the "basis" for the buy or the sell. For example, if you BUY EUR/USD you have bought Euros (simultaneously sold dollars). You would do so in expectation that the Euro will appreciate (go up) relative to the US dollar.

Currency Abbreviations
Symbol Definition Symbol Definition
EUR Euro NZD New Zealand Dollar
GBP Great British Pound AUD Australian Dollar
USD US Dollar CAD Canadian Dollar
CHF Swiss Franc JPY Japanese Yen


EUR/USD
In this example Euro is the base currency and thus the "basis" for the buy/sell. If you believe that the US economy will continue to weaken and this will hurt the US dollar, you would execute a BUY EUR/USD order. By doing so you have bought Euros in the expectation that they will appreciate versus the US dollar. If you believe that the US economy is strong and the Euro will weaken against the US dollar you would execute a SELL EUR/USD order. By doing so you have sold Euros in the expectation that they will depreciate versus the US dollar.

USD/JPY
In this example the US dollar is the base currency and thus the "basis" for the buy/sell. If you think that the Japanese government is going to weaken the yen in order to help its export industry, you would execute a BUY USD/JPY order. By doing so you have bought U.S dollars in the expectation that they will appreciate versus the Japanese yen. If you believe that Japanese investors are pulling money out of U.S. financial markets and repatriating funds back to Japan, and this will hurt the US dollar, you would execute a SELL USD/JPY order. By doing so you have sold U.S dollars in the expectation that they will depreciate against the Japanese yen.

GBP/USD
In this example the GBP is the base currency and thus the "basis" for the buy/sell. If you think the British economy will continue to be the leading economy among the G8 nations in terms of growth, thus buying the pound, you would execute a BUY GBP/USD order. By doing so you have bought pounds in the expectation that they will appreciate versus the US dollar. If you believe the British are going to adopt the Euro and this will weaken pounds as they devalue their currency in anticipation of the merge, you would execute a SELL GBP/USD order. By doing so you have sold pounds in the expectation that they will depreciate against the US dollar.

USD/CHF
In this example the USD is the base currency and thus the "basis" for the buy/sell. If you think the US dollar is undervalued, you would execute a BUY USD/CHF order. By doing so you have bought US dollars in the expectation that they will appreciate versus the Swiss Franc. If you believe that due to instability in the Middle East and in U.S. financial markets the dollar will continue to weaken, you would execute a SELL USD/CHF order. By doing so you have sold US dollars in the expectation that they will depreciate against the Swiss franc.

Article from ForexYard

In the FX market you can buy or sell one currency for another. When you buy a currency, you are said to be "long" in that currency and when you sell a currency, you are said to be "short" in that currency. As the value of one currency rises or falls relative to another, traders decide to buy or sell currencies in order to make profits - since the objective is to earn a profit from their position. Placing a trade in the foreign exchange market is simple and the mechanics of a trade are virtually identical to those found in other markets. Because of the symmetry of currency transactions, you are always simultaneously long in one currency and short in another. An open position is one that is live and ongoing. As long as the position is open, its value will fluctuate in accordance with the exchange rate in the market. To close out your position, you conduct an equal and opposite trade in the same currency pair. For example, if you have gone long in one lot of EUR/USD you can close out that position by subsequently going short in one EUR/USD lot (at the prevailing bid price).

Article from ForexYard