British Pound Profile (Part III)

By Ahmad Hassam

UK is the bridge between US and EU. UK tends to share a more common set of views with the United States. In the present financial crisis, both the US and UK government had worked closely to avoid a meltdown in the capital markets. Economically, the United Kingdom is more free-market oriented than Europe. However at the same time, given its history and its geography, the United Kingdom cant totally disassociate itself from Europe. The upshot is a currency that is affected by politics at home and on the two continents to which its destiny is so closely related.

The British Pound GBP) is active against the dollar and the euro, offering good opportunities to trade both pairs (GBP/USD and USD/GBP). The GBP/USD is one of the most liquid currency pairs in the world. 6% of the all the global currency trading involves GBP as either the base or counter currency.

The recent Financial Service Act has made the London capital markets one of the most efficient in the world. US capital markets still have oversight and regulatory confusions. This makes London an important destination for many foreign investors. One of the reasons for GBP liquidity is the countrys highly developed capital markets. GBP is also in the four most traded major currency pairs EUR/USD, GBP/USD, USD/JPY and USD/CHF in the world.

UK is an important foreign investment destination. Many foreign investors seeking to diversify their investment other than the United States send their funds to the UK. Foreigner investors need to convert their local currency into GBP in order to create these investments.

GBP was full of speculators one to two years back. GBP had one of the highest interest rates in the developed countries. Although Australia and New Zealand had still higher interest rates but their financial markets are not as well developed as UK.

As a result, carry traders would use GBP as the lending currency and would go long against USD, JPY and CHF. Carry trading was popular with many hedge fund managers. It is a long term fundamental trading strategy.

The BOE was forced to lower the interest rates to cope with the present financial crisis. The present global financial crisis has taken a heavy toll on the British Banks as well. There have been a number of high profile bankruptcies. UK Treasury had to intervene heavily in the market by pumping money into a number of failing banks in order to stabilize the financial markets.

Interest rate differentials between UK gilts/US Treasuries is a barometer for GBP/USD flows and UK gilts/German Bunds is a barometer for EUR/GBP flow. These interest rate differentials are widely watched by the professional forex traders to judge where the money will flow between US, UK and EU. Interest rates have been lowered. An exodus of carry traders took place that increased volatility in GBP with the lowering of the interest rates.

Indications on adopting the Euro usually put negative pressure on GBP while further opposition to Euro boosts GBP. The three month eurosterling futures reflect market expectations on UK interest rates three months into the future and can help predict fluctuations of GBP/USD.

GBP/USD currency pair tends to be more sensitive to the developments in the US economy. GBP/USD currency pair is more liquid than EUR/USD pair. However, EUR/GBP is the leading gauge for GBP strength. EUR/GBP is a more pure fundamental pound trade as EU is the UK primary trading and investment partner. GBP has positive correlation with the energy prices. You must keep these facts in mind while determining your bias for GBP as a currency trader. - 23196

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. He is interested in day trading stocks and currencies. Try These 1500 Pips A Day Forex Signals From Heaven. Know Forex Rebellion!

Do You Suppose That GM Should Think About Changing Its Name To Something Else?

By Jennifer McClelland

There have been quite a lot of corporations that have replaced their names subsequent to coming under attack and falling into bankruptcy. Some of the companies that have done that include ValuJet or now known as AirTran, Altria or as you may have once known it, Philip Morris, and Xe, which was once known as Blackwater. Even electronics maker LG has changed its name from Lucky Goldstar to just LG and claimed that it stood for Lifes Good and now its performing superbly with its sales of consumer electronics and appliances.

These companies have done well with the name change; it is as if they are cracking what they once were and becoming a another company with a gleaming, squeaky clean representation.

Promotion professionals nationally agree that the rebranding of GM might be a good thing. If the goal is to try and put this company on a gigantic regimen and just turn it into a smaller car manufacturing company, Im not certain thered be that much injury in rebranding, said Jean-Pierre Dube, a University of Chicago marketing lecturer. The brand isnt in good shape, he stated, so they have not much to lose.

The General Motors make has already become a flawed brand, with a reputation of constructing bad quality cars and now with a huge bankruptcy filing under its belt, not to mention what everyone thinks about the business taking all that national money to keep from having to file for the enormous bailoutwhich they filed anyhow.

Certainly, at present many GM officials are sticking to their guns and not wanting to rebrand the company. CEO Fritz Henderson stated that rebranding wasnt very high on his list of things to do in the business. Which is perhaps a good thing to do bearing in mind all the troubles he inherited, but couldnt rebranding be handed off to the marketing branch? After all, GM still has one of those and it actually doesnt have the money to be throwing into high-cost television spots for now.

Little bits and pieces of GM have by now begun to be rebranded; GMAC monetary services has replaced its name to Ally Bank and General Motors Asset Managemnet is at the present known as Promark Global Advisors.

However, with a corporation that is as well identified as GM could it work?

I dont see anything wrong with trying to perhaps market the company differently than before, but an entire new brand could be tricky to pull off for the business. I believe that the best implementation of rebranding could come from if it were to rebrand some of its subsidiaries such as Chevy or Cadillac. - 23196

About the Author:

Find out more about Quality Cars and get the best Investment Advice.

EUR/USD

By AHmad Hassam

EUR/USD is the most liquid currency pair in the currency markets. There are four currency pairs that are known as the major currency pairs namely EUR/USD, GBP/USD, CHF/USD and JPY/USD that are heavily traded in the global currency markets. The rest of the currency pairs dont have the liquidity to trade big volumes as these four pairs do. Almost like 90% of the global currency exchange is in these pairs. Out of these four pairs, EUR/USD has the most liquidity and is the most popular among the currency traders all over the world. EUR/USD is the most heavily traded currency pair in the global currency markets at the moment. Most of the currency traders are in fact speculators. Trading currencies can be exciting and lucrative. Its a great market because of the way politics affect the trends. Elections, strikes, and sudden developments, both good and bad, can lead to significant trading profits if you stand ready to trade the EUR/USD is a convenient currency pair because it encompasses the policies and the economic activity and political environment of a volatile but predictable part of the world: Europe.

France, Italy, and Germany, the largest members of the European Union (EU), normally operate under high budget deficits and tend to keep their interest rates more stable than the United States, where the free-market approach and a usually vigilant Federal Reserve make more frequent adjustments on interest rates.

The general tendency of the Fed is to make the dollar trend for very long periods of time in one general direction. Here are some general tendencies of the euro on which you need to keep tabs aside from the technical analysis:

1) Given Germanys history of hyperinflation in the first half of the 20th century and the repercussions of that period, namely the rise of Hitler, the European Central Bank (ECB) is almost fanatical about inflation. That means that the European Central Bank raises interest rates more easily than it lowers them.

2) The US and the EU are two major trading partners. This gives EUR/USD currency pair very interesting characteristics. EUR/USD pair is affected by what is happening politically and economically both in Europe and the US. The European Central Banks actions become important when all other factors are equal, meaning politics are equally stable or unstable in the United States and Europe, and the two economies are growing. For example, if the U.S. economy is slowing down, money slowly starts to drift away from the dollar. In the past that meant money would move toward the Japanese yen; however, because the market knows that Japans central bank will sell yen, the default currency when the dollar weakens is often now the euro. USD is inversely correlated to the gold prices. All these facts should be taken into consideration while forming your bias about a particular currency pair.

- The flip side is that the market often sells the euro during political problems in the region, especially when the European economy is slowing and the economy in the United Kingdom (UK), which often moves along with the U.S. economy, is showing signs of strength.

As a word of caution, its okay to form an opinion and have some expectations, but the final and only truth that should make you trade is what the charts are showing you. Candlestick charting is one way to read the markets. There are many candlestick patterns that are used to signal trend reversals or change in the market behavior. The more proficient you become in reading candlestick charts the more profitable your trades would be. As usual, you want to closely monitor major currencies and the cross rates. The direction that counts is the one in which the market is heading. Candlestick charts are a good way to read the direction in which the markets are heading.

It is always best to choose only two or three currency pairs and become a specialist in them. Two currency pairs that I would recommend for you are the EUR/USD and the GBP/USD. Both these currency pairs are highly liquid and very popular among the currency traders. Fundamental analysis can help you determine the strong/weak currency pair. Use fundamental analysis to determine if USD is expected to lose value and EUR is expected to gain more strength that means that the currency pair EUR/USD is perfectly timed for swing trading. Use technical analysis to make the entry and exit decision. Combining fundamental analysis with the technical analysis can give you the edge as a forex trader. Sometimes there is a fundamental shift in the direction of a currency pair. As long as you are not following a currency pair like EUR/USD on the daily basis, you wont be able to understand what is happening. - 23196

About the Author:

Mr. Ahmad Hassam has done Masters from Harvard University. He is interested in day trading stocks and currencies. Try These 1500 Pips A Day Forex Signals From Heaven. Know Forex Rebellion!

A Great Stock Trading Training Center is All You Need

By Chad Reynolds

Have you always wanted to learn about stock and finally get some stock education? Well, just remember that you're not alone. There are lots of people out there who have always thought it may be too hard, too time consuming or too expensive to learn how to trade their own stocks.

Believe it or not, your ability to trade stocks on your own and eventually become a professional profit trader rests in your own hands. Many people want to know if "Trading Stock for Dummies" actually exists? Here are exactly the tools you need to become a real stock trader: hard work, dedication, focus and a great stock trading training program.

Many people don't succeed in stock trading simply because they are too distracted by everyday life events to fully dedicate themselves to learning the material. So the focus, hard work and dedication part is on you. But another problem is that sometimes people subscribe to a stock trading program that is over their heads. When they don't understand the terms being used, they get frustrated and then they easily give up.

You should pick a training program that genuinely cares about your success and will be there for you when you have questions or if you feel frustrated. It is extremely important to choose a profit trading training program that fits your needs and learning curve in order to make you a success story in the long run.

An excellent feature to look for is the option to join a Master Mind Training group. This will give you an opportunity to discuss trading techniques, issues and questions with other traders in your field. The group's goal is to hold everyone else in the group accountable for their stock trading goals, which will help keep you focused and motivated. The lesson here is to look for a training program that can offer extra features besides the basic training courses.

Another great feature to look for is access to the training center's resource library. This is where they keep eBooks, special reports, past recorded seminars and webinars and much more resources that can help you on your way. If the training center of your choice is up-to-date and current, then they can also offer you the option of podcasts, so you can study on the go, in the car, on the train or while you're between meetings or phone calls.

While you're choosing the best training center for you, also keep in mind that it is best to choose a center that offers materials and services for the beginner traders, as well as the experienced trader. If the trading center is beneficial to experienced traders and those traders join the membership, then that gives you an excellent opportunity to converse with professionals who are already in the field. The name of the game is to make contacts and network.

Once you've done some research, you will see that becoming a profit trader is not out of your reach. All it takes is hard work, dedication and focus. All of this can be accomplished with a great stock trading training center and you'll be trading stocks before you know it. - 23196

About the Author:

Want to find out more about stock for dummies, then read more from Chad Reynolds' blogs. He will teach you on how to choose the best stocks and give you a real stock education.

Treat Currency Trading As A Business

By Ahmad Hassam

Always take forex trading as a business if you are currently trading for a living or want to take on trading as a future substitute of your current job. You need to treat it as a business.

Therefore you need to give some consideration to the fact that whether you need to form a private limited company or a public limited company to deduct your monthly expenses such as your computer equipment, your quote feed, your DSL line, travel to investment conferences and continuing education seminars.

Take advantage of all the regular and necessary expenses as business deductions. This can help you save thousands of dollars annually. You should seek advice from a tax specialist so that you know the best way to cut your business expenses.

After all it would be heart breaking to know that you cannot make expense deductions that could literally save you thousands of dollars after you have consistently started making money in the market.

As a forex trader, lets see what your expenses can be: Suppose you rent a small one room office that could cost you like $500-1000 per month. Then you have to have office equipment that includes desktop computers, printers, laptop for travel and so one. Lets say these things cost you $5000.

You need a good DSL connection for your trading, $50 per month for the DSL expense. A price quote feed might cost you like $200 per month. You attend an investment conference that might cost you $1000 roundtrip airfare plus $300 per night for the night stay at a hotel.

You could be taking as little as $5000 to $25,000 per year in actual business expenses that could be deducted if you are running trading as a business and if you have business entertaining expenses and went to two investment conferences per year.

Do you have the financial resources, time and emotional makeup to trade full time if you are a small time investor and decide that trading for a living is something that interests you? Do you have a business plan? What business plan you have in place to protect the money you make in the market.

You need to cover your cost of living expenses, mortgage payments as well as your business expenses. As a long term trader what will you do when the market conditions change according to your system or methods?

Forex dealers provide free charts and quotes. But you have to cover the bid-ask spread each time you trade as a trading cost. The forex market offers you a unique opportunity to participate on a pay as you go method because there are no commissions.

Suppose you are a day trader, you trade twice a day with a 3 pips bid-ask spread. Suppose you trade 10 lots ($100,000) each trade. So your daily trading cost will be $600 = (3) (2) (10) (10). If there are 200 trading days in a year, it means $120,000. So you need to cover $120,000 as your trading cost annually not to talk of your actual losses. You need to keep this in mind that trading is not free. - 23196

About the Author:

Mr. Ahmad Hassam has done Masters from Harvard University. He is interested in day trading stocks and currencies. Try Strignano's Forex Signals free. Discover a revolutionary Forex Robot Trading System!