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Risk-Reward Ratio in Forex Trading

Tuesday, December 30, 2008

From the very beginning of your forex career a term Risk/Reward Ratio will be an important part of your trading strategy. The realization that every single trade you make contains a certain degree of risk will defend you from uncontrollable fears and panic attacks during the trading hours. This is when the risk management comes in handy.

The best known way to figure out the risk you take is to calculate the risk-reward ratio. What is this ratio and how is it determined?

Risk
First thing to do when calculating the risk-reward ratio is to figure out the risk itself. This can be done by analyzing the total sum of money needed to enter the trade. The actual amount of money at risk is calculated by the following formula:

the price of the selected currency multiplied times the amount of lots

Reward
The reward is of course closely related to the profits you hope t make from the price movements.


[ForexGen Services]

Client Services

  • Customer Support
  • Trading Support
ForexGen Partnership

ForexGen offers three types of business partnerships.

* [Introducing Broker]
* [White Label]

* [Money Manager]


ForexGen Introducing Brokers ,White Label and Money Manager holders are recognized as a strategic business partners. The main focus of our service is to satisfy our partner's needs in order to deal with a qualified service and gain a large income sharing plan.

[ForexGen] provides appropriate services satisfying the needs of all business partner's specified situation and requirements.
The first month of the contest is scheduled to start on the 1st of December 2008. So, don’t miss your chance and register your account before that time. You can read the description of this contest model on the official FXcast website. You can also read more about FXcast Forex broker.

Trading in the Forex Requires Some Caution

Whether it is in the millions or thousands, trading in the Forex is a bit risky. There are a lot of players involved and if you don’t arm yourself properly with knowledge about the Forex you may just get swamped.

The Forex is the largest, most vibrant market in the whole wide world. The financial world has never had a market that involves so much transaction.
Over a trillion dollars worth of different currencies exchange hands everyday. Some lose in the trade, while some hit the jackpot and make tons of money.
The Forex is characterized by its unpredictability and the liquidity because it deals with foreign currencies and each one's value influenced by their own country.
That's why anyone who is greatly considering joining the Forex trade should think twice, thrice and maybe even ten times before doing so. This is not an arena for the weak and nervous.
The Forex is a very complex financial arena and only those with enough knowledge, experience and financial capability can join the foray.

Managing the risk factors is a priority task for those professionals who do this everyday. They direct and manage accounts from their investors, full confidence is placed on them and their client's success is also their success.
Some professional Forex brokers have placed high value on their credibility. The more clients they have, the more they earn as well. They make a profit by eating a slice of their client's profit. If they have made a name for themselves in the Forex trade, they don’t need to go look for clients; the clients will look for them and invest.
There are those, however, who want to manage their own portfolios. A word of caution though -- educate yourself first about the trade.

Learn the ropes and tricks of the game before throwing your hat in the ring. Try to gain access to many self-learn and self-study websites that can impart their knowledge with you.
Try out the website of the Federal Commodities Futures Trading Commission (CFTC), there they offer consumer reports as well as articles about applicable laws in Forex trading.
Many Forex management firms maintain a website that offers free online tutorials and brochures. You may need all the educational information about the Forex that you can get your hands on.
They may not outright say it, but the best and the finest and most skilled Forex traders have learned all the secrets of the game. From trading signals technical indicators, and theories that could explain about the market behavior.

[Why ForexGen]


1. Lowest spreads in the market with 0-1 pips in 10 pairs, no commissions, no swaps and instant account Activation.
2. Scandinavian quality with Swiss precision, funds secured and local agents in 18+ countries.
3. ForexGen offers Forex trading in the major currency pairs and crosses.
4. Low capital start, with $250 as a minimum account size.
5. Liquidity and 24/5 availability are the characteristic factors of the Forex market compared with other financial markets.
6. ForexGen offers a free trial Forex [demo account] that allows you to test your skills and practice without risking real money.

We consider every client as a special case, a VIP and a partner. A client's profit is our success and a client's loss is a significant call of action for us. Customer care is the heart of our business, we know every client on personal bases as we provide 24/7 customer support.
We keep contact with our clients to ensure that we are on the right track. Leading our client relationship to success is our focus.
Let [ForexGen] prove to you that you have taken the right step by choosing our partnership.

How Currencies are Traded in the FOREX Market

Currencies are traded in dollar amounts called “lots”. At 100:1 leverage, one lot is equal to $1000 which controls $100,000 of a given currency. This leverage is known as “margin” and some brokers will allow traders even higher leverage than 100:1. This superhigh leverage is one of the reasons that Forex trading has become so popular.

Currencies are always traded in pairs. Each pair has unique notation that expresses which currencies are being traded.
The symbol for a currency pair will always be in the form ABC/XYZ. ABC/XYZ is not a real currency pair, just an example of how currency pairs are stated in the market. I
n this particular example, ABC is the symbol for one country’s currency and XYZ is the symbol for another country’s currency.

Listed below are some common symbols used. There are symbols for other currencies as well, but these are the most commonly traded ones.

USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar

[ForexGen Introducing Brokers]

Introducing Brokers may be individuals or institutions who gain their income from the commissions and/or rebates by introducing customers to ForexGen trading.


WHAT are the advantages of being an INTRODUCING BROKERS with ForexGen?

* Providing the most huge income sharing plan
* Providing several ways for our IB's to charge commission.
* ForexGen IB can also charge commission for each lot the traders execute.
* Moreover, ForexGen IB is able to increase the spread for all or certain clients and have ForexGen Investments rebate the difference.

In case the IB does not increase the spread or charge their clients a commission, ForexGen rebate the IB a minor predefined amount for every client's executed lot.
Commission is paid out every month.

Individualized service

[ForexGen] offers our IB's individualized service created according to the individual needs and specified business situation for each IB.
Our Introducing Broker program provides a highly organized program for individualized services and organizations in order to introduce their clients to the online foreign currency exchange market, moreover they will enjoy the benefits of being a part of the ForexGen family.

ForexGen offers 1 pip spread on 10 pairs with high trading techniques that make ForexGen
incomparable to any other rival.

What Would You Rather Do

Read About Someone Else's Forex Success or Experience Your Own

You can draw some useful parallels between running a business and Forex trading. For instance, most successful businesses keep statistics on everything from their conversion rate, to their average dollar sale, to the number of people that come in the door.
Businesses do this to keep on top of how they are doing on a day-to-day basis and businesses must first take score before beginning to improve on that score.

Using a Forex back testing plan in your trading works exactly the same way.
Now that you're looking at Forex trading as a business, you need to learn some valuable statistics about your system so you can improve it's performance.

You would use a Forex back-testing method. You can't improve your system unless you have something to measure it against. How could you expect to improve your trading unless you knew what it was you were looking to improve? You can discover these measurements and other valuable information about your trading system, by using a Forex back testing plan.
There are two ways that you can use a Forex back testing plan to back test a system.
You can do it manually, which can be a drawn-out and labour-intensive process, or you can do it with the aid of some software packages.

Unfortunately, I recommend you do it by hand when you first start out. You'll get a much better feel for your system, and you'll understand exactly how using a Forex back testing plan works in all its intricacies.
Once you have the Forex back testing plan and the in-depth knowledge, you could look at finding a software package that does it for you.

[ForexGen Live Account]

The live/real account is provided to those clients who may have some experience in the online trading.


[Opening an Account Online]

The quickest, easiest and secure way to open a ForexGen trading account is online.
Complete and submit your application online in just a few minutes.

ForexGen.com is an online trading service provider supplying a unique and individualized service to Forex traders worldwide. We are dedicated to absolutely provide the best online trading services in the Forex market.

ForexGen provides a unique online trading experience based on our intelligent online Forex trading package, the ForexGen Trading Station, including the best online trading system.


Trying Forex Trading with the Best Strategy and Approach

With the way things are today, more people are getting interested in investing their dollars to make them grow faster. The problem is, not too many people are willing to take the risk of investing it, so they just let their money rut in banks.
Not that there's anything wrong with banks' it's just that they have low rates and the money takes a long time to grow.

If you want real money, you have to have the guts to risk it. Making money takes money; risks are always involved if you want to have money fast and big.
One of the largest arenas where you can invest is Forex (Foreign Exchange).
Forex trading is regarded as the largest financial forum in the world with an estimated 3.1 trillion dollars of volume everyday.

Forex trading is open 24 hours and never sleeps. Transactions are done all over the world via telephones and computers, money exchanges hand in the number of millions in just mere seconds.
Forex trading is composed of thousands of banks and individual Forex trading companies that monitor development all over the world, developments that may influence the value of their currency.

Forex trading deals with the exchange of currencies from different countries. The idea is to determine the rise and fall of the value of a certain currency and trade when it is deemed advisable.

[ForexGen Money Manager]

An individual who is responsible for the entire financial portfolio of another individual or another entity. A money manager receives payment in exchange for choosing and monitoring appropriate investments for the client.

Benefits of being a Money Manager with [ForexGen]:

* Providing three different commission sources.
* Weekly commission plan.
* Easy & fast commission withdrawals.
* Fixed percentage of the profits.
* P = k * D “P=Profit, k=Variable Parameter, D=Deposits”

The money manager gets a fixed percentage of the profit previously agreed upon with the client for managing the client funds as a bonus feature.

The most competitive trading conditions:

* 2 pips spread on six currency pairs.
* Providing online trading services without maintenance margin, margin call and no automatic closing of positions below the initial margin on weekdays for accounts with initial equity of up to $1 million US. The margin level have to be recognized Fridays at 23:00 CET and before public holidays.
* Leverages up to 1:200 for accounts up to $1 million US.
* Liquidity and 24/5 availability are the characteristic factors of the Forex market compared with other financial markets.

Choppy Markets Cloud A Potentially Strong GBPUSD Range

Monday, December 29, 2008

Fundamental forecasts and technical price patterns are rarely clean and clear for any market. For recent GBPUSD congestion, this reality leaves the pair on the edge of a potentially lucrative range setup or major breakdown.

Why Would GBPUSD Hold a Range?

· Levels to Watch:
-Range Top: 1.5725 (Fib, Swing High)
-Range Bottom: 1.4360 (Trend, Fib, SMA)


The markets are still very thin; and developing new, major trends will be exceptionally difficult without a deep market to feed momentum and keep opposing market forces inundated. On the other hand, the week fundamentals between the US and UK as well as the inequality for interest rate expectations will make for a strong current to for recharging a dominant theme and trend. Event risk is also a consideration that should be accounted for.

·Looking at the long-term GBPUSD chart, it is hard to miss the dominant trend that has developed for the past 14 months. However, it is very difficult to extend an already exhausted trend in illiquid markets. Therefore, we are left to wonder whether this pair is developing an imprecise triple bottom or pushing the next leg of a major bear trend.

Suggested Strategy


· Long: Half sized entry orders will be set at 1.4480 – above spot.

· Stop: An initial stop at 1.4360 is wide enough to cover a tail on a triple bottom in thin markets. To secure profit, move the stop on the second lot to breakeven when the first target hits.

· Target: The first objective equals risk (120) at 1.4600. The second target will be 1.4800.

Trading Tip – Fundamental forecasts and technical price patterns are rarely clean and clear for any market. For recent GBPUSD congestion, this reality leaves the pair on the edge of a potentially lucrative range setup or major breakdown. Regardless of what happens though, this setup is very risky. Those that are risk adverse should stay clear; and even aggressive traders should approach this cautiously and with a sound setup. Looking at price action into the US session close, we can see that GBPUSD has already closed below the early December low to a six and a half year low. However, history shows us that it is very difficult for a market to revive a move that is already pushing an extreme under normal conditions. When liquidity is as thin as it is during the turn of the New Year, it becomes exponentially more difficult to define a new leg of a major trend. At the same time, such conditions also make for choppy and imprecise markets. Therefore, we are approaching this setup with an entry that looks for confirmation of a reversal, half-sized positions and wide stops - all to lower risk. Furthermore, we will cancel all open orders by Thursday or should spot hit 1.4325 before we are entered.

Event Risk UK And US

UK – Scheduled event risk is significant for the pound, but not until Friday. On the other hand, it is important to look at the broader context in the fundamental drive behind this currency and economy. The United Kingdom is one of the view major nations that can rival the US for depressed forecasts in its growth and financial markets. The housing and consumer sectors in the UK is projected to see far worse times ahead of it thanks to the imbalance in the credit markets and the momentum behind one of the worst global recessions in decades. What’s more, interest rates (a primary gauge for expected returns from assets) still has considerable room to fall in the island nation – and fall they will. This provides the pound with a general bearish tone; but the economic docket will also have its influence later in the week. On Friday, the calendar fills out with credit, housing and manufacturing data that will be essential to discounting next week’s BoE rate decision.

US – The ebb and flow in dollar interest that is based on the concept of the US as a safe haven has certainly tempered with the global drop in liquidity. However, in its place comes the primary fundamental forecasts for growth and financial health that were previously relegated to the back burner when panic was diverting capital to Treasuries. This outlook is certainly bleak. On the other hand, the market has certainly made the effort to discount such concerns. To try and unbalance these long-term considerations, economic indicators may have their way with price action over the coming days. Tomorrow, the lagging S&P/Case-Shiller housing sector inflation gauge will reaffirm what other indicators have already established, but a December consumer sentiment gauge will offer a better angle.

[ForexGen Live Account]

The live/real account is provided to those clients who may have some experience in the online trading.

[Opening an Account Online]

The quickest, easiest and secure way to open a ForexGen trading account is online.
Complete and submit your application online in just a few minutes.

ForexGen.com is an online trading service provider supplying a unique and individualized service to Forex traders worldwide. We are dedicated to absolutely provide the best online trading services in the Forex market.

ForexGen provides a unique online trading experience based on our intelligent online Forex trading package, the ForexGen Trading Station, including the best online trading system.

Once World's Smoggiest, Mexico City Cuts Pollution

Sunday, December 28, 2008

Contaminated capital reclaims air quality: Mexico City offers model for slashing pollution

Gabriela Escalante stalks the rumbling streets alongside newspaper, peanut and candy vendors, wading deep into traffic at red lights across town.
Her eyes are fixed on tailpipes.
A member of Mexico City's "ecoguarda," or environmental police, she and some 50 colleagues are on the lookout for white clouds of toxic exhaust, stopping hundreds of offending motorists each day, issuing $100 fines and confiscating license plates -- a small but urgent army fighting the capital's infamous air pollution.

"We detect, we detain and we fine," said Escalante, 27. "This is the air we all breathe."
Not long ago, air in this throbbing capital was so bad that cyclists wore surgical masks. Birds fell dead in mid-flight, and children used brown crayons to draw the sky. Ozone exceeded safe levels on 97 percent of days in the year.
But the metropolis ranked the world's most polluted by a 1992 U.N. report has since slashed some of its worst emissions by more than three-quarters and has become a model for improving urban air quality.

Capitals such as Beijing, Cairo, New Delhi and Lima are now more contaminated, according to the World Bank, while air in at least 30 other cities contains more toxic particles, including Barcelona and Prague.
When Latin American leaders met here last month to discuss the environment, many looked to Mexico as an example of progress, said Sergio Jellinek, a World Bank spokesman who attended the forum.
Still, a nagging cloud of ozone has been harder to reduce -- a sign of the secondary air pollution problems that cities can expect even after cutting their most visible contaminants.

With the onset of winter, the worst time of year for pollution, Mexico City has said it plans to spend $3 billion by 2012 to expand public transit and further slash emissions.
"There has been a large improvement, and it's important to show it could be done," said Mario Molina, a Nobel Prize-winning Mexican chemist now advising President-elect Barack Obama's transition team on environmental issues. "But there's still a long way to go to get really satisfactory air."
Ringed by volcanoes and nearly a half-mile higher than Denver, the city's geography and population make it a "perfect factory" for pollution, said Adrian Fernandez, head of the National Institute of Ecology, Mexico's version of the EPA.

In thin air at over 7,300 feet, fuel burns less efficiently, releasing more unused particles. Breathing deeper to fill their lungs, people inhale more toxins.
High-altitude sunshine speeds the chemical reactions that transform emissions into a lethal stew of smog. That brown cloud blankets the city, lowering temperatures cool and trapping pollutants on the ground.
"What you have is a casserole dish with a lid on top," said Armando Retama, a chemist at the city's Environment Department.

Mexico City and its sprawling suburbs swelled from 3 million people in 1950 to more than 20 million today, making it the world's second-biggest urban area after Tokyo. Economic growth kept pace, boosting energy consumption and flooding the roads with more than 4 million vehicles.
Traffic is so clogged that average speeds have dipped to 13 mph, the Environment Department says. Even with today's cleaner cars, experts agree that 70 to 80 percent of emissions are vehicle-related.

The fumes inspired the novelist Carlos Fuentes to rename his toxic capital "Makesicko City" -- and it does make people sick.
Studies show the air irritates the eyes, nose and throat and worsens asthma, allergies, colds, coughs, bronchitis and the flu, while increasing infant deaths and overall mortality. Long-term exposure was found to impair one's sense of smell and to decrease the size and strength of children's lungs.
Mexico has been fighting the haze for decades, passing its first anti-pollution bill in 1971, a year after the U.S. formed the EPA. But enforcement lagged -- until the record smog of the early 1990s.

Learning from Los Angeles' air cleanup, Mexico got to work changing technology and laws. Unleaded gasoline was introduced, catalytic converters were required on new cars, a major refinery was closed and power plants were pushed to switch from oil to natural gas. Factories moved away, decentralizing some of the clog.
The city began emissions tests in 1989 in a landmark program that banned old and failing cars from the road one day a week. Emulated in Beijing, Bogota, Seoul, Santiago, Sao Paulo and elsewhere, Mexico's program now idles at least 320,000 cars a week.
In their first democratic vote for mayor, residents in 1997 elected the green-friendly Democratic Revolution Party, which has since dominated city politics. The capital now vows to slash greenhouse gases 12 percent by 2020 and champions public transit, which accounts for 82.5 percent of trips taken each day.

Data from the city's 36 air-quality monitoring stations show lead levels down 95 percent since 1990, while sulfur dioxide has fallen 86 percent, carbon monoxide 74 percent, and peak ozone levels 57 percent since 1991.
Still, when chemist Retama pulls a filter from an air collector at a rooftop station, the fine screen is covered with a gray film.
"This is what people are breathing into their lungs," he said.

Mexico's federal government still subsidizes gasoline, even as its sagging state oil monopoly delays introducing ultra-low-sulfur fuel. Most trucks and buses are exempt from emissions tests, and a flood of dirty used cars is set to cross the border from the U.S. when NAFTA restrictions expire in January.
Peak ozone levels still exceed the recommended limit on more than half the days in the year.
On the streets, drivers pulled over for polluting often plead poverty, saying they can't afford to fix their cars.

But in a dusty trailer at ecoguarda headquarters, where shelves bulge with 30,000 confiscated license plates, sympathy is short.
"Anyone who has a car should be responsible for keeping it in good condition," said Alejandro Lopez Carrillo, former head of the unit, who himself is banned from driving his over-the-hill 1998 Lincoln on Fridays.
"I want to have a better world, with better air for our families and futures."

[ForexGen Demo Accounts Contest]

Win Cash Prizes

[ForexGen] has the pleasure to announce the launching of the Demo Account contest on the first of every month.

Interested clients who wish to participate in this event shall send an e-mail request on demo.contest@forexgen.com including the following information:
- Full name:
- Phone number

Also provide us with the following identification document:

" Certified copy of the information pages of account holder current valid passport or government issued photo ID"

After we receive your request we will provide you with further details and with your [demo account] login information which will be used in the trading contest.

By the end of each contest:

1. All participants that manages to open at least 20 lots will be awarded a Live Account with $50 credit
2. All participants that manages to open at least 20 lots and keep their demo account initial balance will be awarded a Live Account with $100 credit

3. The highest 5 accounts with the highest profits (including the floating P/L) will be awarded a Live Account with $250 credit.


The contest starts on the first Sunday of each month at 10 pm GMT and ends on the last Friday of that month at 10 pm GMT.


For more information about our current and future promotions, kindly contact one of our customers support agents at promotions@forexgen.com

Announcing New Type of Forex Traders Competition

Wednesday, December 24, 2008

Announcing a new type of the Forex trader’s competition today — the Hall of Fame type of competition. You don’t need to open some special account for it or pay for entering the competition. The contest is judged upon the monthly performance of your real trade account. The performance is denominated in the percentage to your monthly starting account and will only include your actual trading results. This way you can win the real prizes using even your starting $10 real Forex account.

The prizes are quite nice for a free monthly competition. The first prize is $3,000, while the second is $1,500 and the third one is $500. The prizes are paid to the traders accounts, but are not withdrawable. Of course, they can be used to trade and the earned profit can be withdrawn by the trader. The prize money will be deducted from the trader’s balance after a month being in his trading capital.


[ForexGen Services]

Client Services

  • Customer Support
  • Trading Support
ForexGen Partnership

ForexGen offers three types of business partnerships.

* [Introducing Broker]
* [White Label]

* [Money Manager]


ForexGen Introducing Brokers ,White Label and Money Manager holders are recognized as a strategic business partners. The main focus of our service is to satisfy our partner's needs in order to deal with a qualified service and gain a large income sharing plan.

[ForexGen] provides appropriate services satisfying the needs of all business partner's specified situation and requirements.
The first month of the contest is scheduled to start on the 1st of December 2008. So, don’t miss your chance and register your account before that time. You can read the description of this contest model on the official FXcast website. You can also read more about FXcast Forex broker.

Forex Scalping Trading Systems

Tuesday, December 23, 2008

Forex Trading in many ways is quite a lot like not only other types of trading but also any other type of activity where you put money in expecting to get some out. Things like sports betting and poker playing are very similar to Forex Trading in as much as the actual movement of money is concerned. Because all of these types of money making endeavors involve putting money in to get hopefully more money out there are strategies that can be learned and taught in order to make this type of thing easier to do. These strategies are usually referred to as systems and when you are dealing with a Forex Market, there are any numbers of systems that you can apply to it. One large category of systems is known as scalping and this article explains exactly what that means.

Forex Scalping Trading Systems

Scalping is a term that is used in a number of different types of trading and it means virtually the same thing in each circumstance that it is used. Forex trading revolves around following pip changes in the currency pairs and capitalizing on those pip changes in order to make money. Pip changes are usually occurring in the thousandths decimal place which is why it is necessary to trade huge amounts of currency in order to make any amount of money. Forex scalping trading systems revolve around the principle that a larger number of smaller trades are a sounder method to use than the normal long term day trades that many people utilize. Forex scalpers will only try to make 5-15 pips per trade and initiate many more trades each day as opposed to trying to make 40-50 pips per trade with a smaller amount of trades in a day.

[Why ForexGen]


1. Lowest spreads in the market with 0-1 pips in 10 pairs, no commissions, no swaps and instant account Activation.
2. Scandinavian quality with Swiss precision, funds secured and local agents in 18+ countries.
3. ForexGen offers Forex trading in the major currency pairs and crosses.
4. Low capital start, with $250 as a minimum account size.
5. Liquidity and 24/5 availability are the characteristic factors of the Forex market compared with other financial markets.
6. ForexGen offers a free trial Forex [demo account] that allows you to test your skills and practice without risking real money.

We consider every client as a special case, a VIP and a partner. A client's profit is our success and a client's loss is a significant call of action for us. Customer care is the heart of our business, we know every client on personal bases as we provide 24/7 customer support.
We keep contact with our clients to ensure that we are on the right track. Leading our client relationship to success is our focus.
Let [ForexGen] prove to you that you have taken the right step by choosing our partnership.

Bonds Fall After $92B in Auctions

Monday, December 22, 2008

Government bonds fell Monday for the second straight session after the Treasury Department auctioned off $92 billion in debt.
Treasury sold a record $38 billion in an auction of 2-year notes and a combined $54 billion in 3-month and 6-month bills as the government attempts to finance its ever-growing debt. The Treasury last week promised $13.4 billion to the U.S. auto industry, using up the last of the first $350 billion Congress allotted to rescue the financial markets.
Growing supply continues to meet high investor demand for government bonds. With the stock and commodities markets plunging this year, investors have placed their funds in Treasurys with the hope that the securities will serve as a safe-haven investment. As a result, bonds have performed very well this year, despite a volatile economy and financial markets.

"There continues to be good demand for Treasurys," said Andrew Brenner, senior vice president at MF Global. "That will continue until at least after the first quarter of 2009, when we start to see sustained improvement in the stock market and in the economy."
As a result, the auctions were met with high interest, even with another $28 billion to be auctioned in 5-year debt on Tuesday. Bond investors didn't seem to mind ultra-low yields, with the 3-month bill yielding less than 0.01% in the auction. The 2-year bill had a median yield of just 0.83% in the auction, the first time it registered a yield below 1% since the Treasury began keeping records in 1976.
"This may be the first auction since the Eisenhower administration with a coupon below 1%," Brenner said. "Still, the auction gained a reasonable level of support."

Bonds fell slightly Monday, as they were lightly traded with many traders on holiday vacation. Such light trading may continue through the rest of the year, which means bonds may show only slight movements - regardless of the size or success of future auctions - until January.
"This is typically a very slow time of the year, and volumes are off dramatically today, running 30% below normal," Brenner said. "That means there's not a lot of people to put the money to work."
Bonds fall: The 10-year note dipped 3/32 to 114-11/32, and its yield rose to 2.14% from 2.13% from Friday. Bond prices and yields move in opposite directions.
The 30-year long bond dropped 1-3/32 to 139-6/32, and yielded 2.59%, up from 2.56%.

The 2-year note fell 4/32 to 100-28/32, and its yield rose to 0.81% from 0.75%.
The yield on the 3-month note fell to 0.02% from 0.03%, and has been hovering around 0% for more than a week. Yields near the zero mark on short-term bills are an indication that investors are completely risk-averse, prioritizing safety above profit.
Lending rates remain low: Meanwhile, lending rates between banks remained near record low levels.

Libor, the London Interbank Offered Rate, is a daily average of what 16 different banks charge other banks to lend money in London, and is used to calculate adjustable-rate mortgages. More than $350 trillion in assets are tied to Libor.
Two market gauges showed confidence edging higher.
The "TED spread" narrowed to 1.45 percentage points from 1.48 percentage points Thursday. The TED spread measures the difference between the 3-month Libor and the 3-month Treasury bill, and is a key indicator of risk. The higher the spread, the more unwilling investors are to take risks.

Another indicator, the Libor-OIS spread, fell to 1.24 percentage points from 1.29 percentage points as the Overnight Index Swap rate plummeted to 0.17% from an opening level of 0.32% Tuesday.
The Libor-OIS spread measures how much cash is available for lending between banks, and is used for determining lending rates. The bigger the spread, the less cash is available for lending.

[ForexGen Introducing Brokers]

Introducing Brokers may be individuals or institutions who gain their income from the commissions and/or rebates by introducing customers to ForexGen trading.


WHAT are the advantages of being an INTRODUCING BROKERS with ForexGen?

* Providing the most huge income sharing plan
* Providing several ways for our IB's to charge commission.
* ForexGen IB can also charge commission for each lot the traders execute.
* Moreover, ForexGen IB is able to increase the spread for all or certain clients and have ForexGen Investments rebate the difference.

In case the IB does not increase the spread or charge their clients a commission, ForexGen rebate the IB a minor predefined amount for every client's executed lot.
Commission is paid out every month.

Individualized service

[ForexGen] offers our IB's individualized service created according to the individual needs and specified business situation for each IB.
Our Introducing Broker program provides a highly organized program for individualized services and organizations in order to introduce their clients to the online foreign currency exchange market, moreover they will enjoy the benefits of being a part of the ForexGen family.

ForexGen offers 1 pip spread on 10 pairs with high trading techniques that make ForexGen
incomparable to any other rival.

Dollar Recovers Further as Bailout Announced

Sunday, December 21, 2008

Dollar bounces back, recouping some of week's huge losses, as Detroit gets emergency loans

The dollar continued to surge higher against the euro Friday, recovering some of this week's steep losses as the U.S. government announced a $17.4 billion bailout plan for Detroit.
The 15-nation euro plummeted more than 4 cents to $1.3887 in late New York trading Friday from $1.4313 late Thursday. The euro peaked at $1.4719 early Thursday morning, its highest point against the dollar since September, and has dropped 5.7 percent since then. Last Friday, the buck was worth $1.3371 against the euro.
The dollar got steamrolled after the Federal Reserve cut rates to a range from 0 to 0.25 percent on Tuesday and announced it would take other, unprecedented moves to inject liquidity into markets and jumpstart lending. The dollar started to recover Thursday, however, and the U.S. government's announcement of $17.4 billion in emergency loans for Chrysler LLC and General Motors Corp. now and early next year helped tug it up further as equities gained.

The ECB also said Thursday that it would increase the interest rate it charged banks to borrow from the ECB, while lowering the rate paid on deposits parked within the bank. The changes would take effect Jan. 21 after the ECB's next meeting Jan. 15, when the refinancing rate could change.
While the ECB did not detail the reasons for the moves Thursday, officials at the bank recently said they were considering measures to encourage financial institutions to lend more to one another.
Interbank lending has all but stopped in recent months as bank failures and credit defaults caused lenders to hoard their cash.

The moves could effectively increase the money supply, which, like cutting rates, can weaken a currency.
The ECB still has one of the highest key interest rates of the majors at 2.5 percent. The Bank of England is likely to ease further from its 57-year low of 2 percent as Britain struggles with a collapse in housing, a shaky financial sector and unemployment nearing 2 million people.
The pound slid to $1.4859 from $1.5070 late Thursday, and is circling parity with the euro at 1.0716 euro.

The Bank of Japan cut its interest rate 0.1 percent on Friday, partly due to the yen's recent surge to 13-year highs, said Gov. Shirakawa. A strong yen hurts the country's major exporters, raising the prices of Japanese autos and electronics for overseas consumers.
The dollar inched up to 89.45 Japanese yen from 89.42 yen. On Wednesday, the dollar bottomed at 87.11 yen, a 13-year low.
In other late trading, the dollar rose to 1.1073 Swiss francs from 1.0754 francs late Thursday, and edged up to 1.2221 Canadian dollars from 1.1997.

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Dollar Rises Amid Economic Jitters

Thursday, December 18, 2008

The U.S. dollar gained strength against major currencies Thursday as economic worries about the state of the global economy persisted and the number of U.S. workers filing for first-time unemployment benefits fell more than expected.
The yen retreated from the 13-year high it reached against the dollar Wednesday ahead of an interest rate decision from the Bank of Japan. The Japanese currency fell against the dollar Thursday, increasing to ¥89.43 from ¥87.23 late Wednesday.

At 0.3%, Japan has the second-lowest rate among the world's major economies and investors were taking a step back ahead of Friday's announcement.
The 15-nation euro fell nearly two cents to $1.4243 from $1.4418.

The European Central Bank's next meeting is set for January, and investors are watching to see whether the bank will keep its rate firm after slashing it to 2.5% earlier this month.
The British pound dropped more than five cents to $1.5011 Thursday from $1.5534.
Currently, the Bank of England's rate remains at 2%, the lowest in the bank's history, and policymakers are slated to meet in January to discuss the rate.

Economy

The number of Americans filing for first-time unemployment benefits fell more than expected last week, according to a government report released Thursday. Initial filings for state jobless benefits fell to 554,000 for the week ended Dec. 13.
Oil prices fell below $37 a barrel Thursday, reaching level not seen since June 2004. Investors continued to shrug off an upcoming OPEC production cut announced on Wednesday, after which oil closed at a 4 1/2 year low.

Concerns ahead

On Tuesday, the Federal Reserve cut its federal funds rate from 1% to a range between 0% and 0.25%, the bank's 10th cut since September 2007.
While interest rate cuts are the U.S. central bank's main tool for boosting economic activity, many currency analysts worry about the long-term effects of lower interest rates on the dollar.

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* Leverages up to 1:200 for accounts up to $1 million US.
* Liquidity and 24/5 availability are the characteristic factors of the Forex market compared with other financial markets.

Industrial Sector Indicators

Wednesday, December 17, 2008

Industrial Production indicator consists of the total output of a nation's plants, utilities, and mines. From a fundamental point of view, it is an important economic indicator that reflects the strength of the economy, and by extrapolation, the strength of a specific currency. Therefore, foreign exchange traders use this economic indicator as a potential trading signal.

Capacity utilization indicator consists of total industrial output divided by total production
capability. The term refers to the maximum level of output a plant can generate under normal business conditions. In general, capacity utilization is not a major economic indicator for the foreign exchange market. However, there are instances when its economic implications are useful for fundamental analysis.

A "normal" figure for a steady economy is 81.5 percent. If the figure reads 85 percent or more, the
data suggests that the industrial production is overheating, that the economy is close to full capacity. 18 High capacity utilization rates precede inflation, and expectation in the foreign exchange market is that the central bank will raise interest rates in order to avoid or fight inflation.

Factory orders. Refer to the total of durable and nondurable goods orders. Nondurable goods
consist of food, clothing, light industrial products, and products designed for the maintenance of durable goods. Durable goods orders are discussed separately. The factory orders indicator has limited significance for foreign exchange traders.

Durable goods orders. Consist of products with a life span of more than three years. Examples of
durable goods are autos, appliances, furniture, jewelry, and toys. They are divided into four major
categories: primary metals, machinery, electrical machinery, and transportation.
In order to eliminate the volatility pertinent to large military orders, the indicator includes a
breakdown of the orders between defense and non-defense.
This data is fairly important to foreign exchange markets because it gives a good indication of
consumer confidence. Because durable goods cost more than nondurables, a high number in this
indicator shows consumers' propensity to spend. Therefore, a good figure is generally bullish for thedomestic currency.

Business inventories. Consist of items produced and held for future sale. The compilation of this
information is facile and holds little surprise for the market. Moreover, financial management and
computerization help control business inventories in unprecedented ways. Therefore, the importance of this indicator for foreign exchange traders is limited.

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Euro Rises On Dollar to $1.3706

Tuesday, December 16, 2008

The euro rose against the dollar Tuesday as investors awaited a decision on interest rates at the U.S. Federal Reserve's last meeting of the year.

The 15-nation euro rose to $1.3706 in European morning trading, up from $1.3665 in late New York trading Monday.

The Fed is expected to cut a key interest rate -- perhaps to an all-time low -- in a desperate bid to stem the U.S's economic slide.

With the Fed's key rate dropping ever closer to zero, the central bank is moving into uncharted territory.

Nonetheless, Fed Chairman Ben Bernanke has made it clear the Fed isn't running out of ammunition to fight the worst financial crisis since the 1930s. It is exploring tools other than rate cuts to revive the economy. New insights on that front could be revealed when Bernanke and his colleagues wrap up a two-day meeting Tuesday.

"The greenback remains under pressure ahead of tonight's (Fed) rate verdict with speculation that something more aggressive than a 50 basis point cut will be seen heaping pressure onto the currency, although just how sustainable this attack will be isn't without question," James Hughes, a currency analyst at CMC Markets in London said.

"The harsh reality is that any perceived dollar weakness can't really be offset by switching into another currency as the likes of the euro and pound are both struggling too whilst the treat of stagnation in Japan is also leaving the yen as a rather poor alternative."

In other trading, the British pound rose to $1.5277 Tuesday from $1.5253, while the dollar fell to 90.32 from 90.60 Japanese yen late Monday in New York.


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A Short-Form Application For Big Bailout Bucks

Monday, December 15, 2008

2 pages can get you a bailout billion, or at least get you started in the right direction

Ever need a college loan? You've probably pored through the notorious eight-page FAFSA application. A likely home buyer? Try the five-page Uniform Residential Loan Application.

But what if you're a bank looking for a few billion from the federal government's new Capital Purchase Program?

Two pages.

That's all the nation's financial institutions had to fill out to request money from the government's $700 billion Trouble Asset Relief Program. In fact, the first page only requires bank contact information.

For some lawmakers and watchdog groups, the simple request form has become a symbol of a government financial bailout plan in need of more accountability and oversight.

"When student lenders and mortgage companies ask more questions in lending thousands of dollars than the federal government does when it injects billions of dollars worth of capital, we should all be concerned," said Rep. Spencer Bachus of Alabama, the top Republican on the House Financial Services Committee.

That said, the application process is not particularly easy. Applicants had to submit their forms by Nov. 14 to banking regulators, who have access to vast amounts of data about the banks seeking the money. Those regulators are generally well-acquainted with the applicants and then make a recommendation to the Treasury on whether to provide the capital infusion or not.

"The application starts the process, it's not the end of the process," said Brian Olasov, a former Wall Street banker and now managing director at McKenna Long & Aldridge, an Atlanta-based law firm.

"Either the Treasury or the primary regulator reserves the right to come back to the bank and ask additional questions," Olasov said. What's more, if a bank gets preliminary approval, it also must provide a security purchase agreement and a warrant agreement -- paperwork that far exceeds the original two-page application.

The money comes from a $250 billion fund within the Troubled Asset Relief Program that was designed to provide a capital infusion to banks in hopes that would loosen up lending. So far, 87 financial institutions have received money, ranging from $2 million to $25 billion. Banks can request from 1 to 3 percent of their assets.

During a House Financial Services committee hearing, GOP Rep. Randy Neugebauer of Texas asked Neel Kashkari, the director of the Treasury office that oversees the bailout program, whether the banks had to present a business plan that explained what they would do with the money.

"Not specifically," Kashkari replied. "It's very hard for us to try to micromanage and say this is how you should run your business, because each bank and each community is a little bit different. So we wanted to work with the regulators to identify the healthy banks, put capital in on the same terms, and then create the economic incentives for them to want to go make new loans."

Bachus, in an interview, contrasted the bank application process to the paces Congress put the auto industry through when Detroit's Big Three automakers asked for financial relief.

"Automobile companies came to the Congress for four lengthy hearings," Bachus said. "They were told, 'We're not going to even consider giving you money unless you tell us everything you're going to do to return to profitability.'"

Of course, General Motors and Chrysler were pleading for their lives. The bank capitalization program is designed only for financially stable institutions.

But for Steve Ellis, vice president of the nonpartisan Taxpayers for Common Sense, there's that two-page application.

"It's still somewhat shocking to the senses," he said, "when you think that credit card applications are a heck of a lot longer than that."


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White House Promises Last-Ditch Auto Rescue

Sunday, December 14, 2008

White House readies last-ditch plan to prevent collapse of nation's auto industry

With Congress gridlocked and the economy floundering, the Bush administration declared Friday it would step in to prevent the "precipitous collapse" of the U.S. auto industry and the disastrous loss of hundreds of thousands of jobs sure to follow.
A day after the sudden demise of rescue legislation in Congress, carmakers were talking with the administration and the Federal Reserve about how they could still get the billions of dollars they say they need to survive. The talks included conditions that automakers would have to meet, said GM spokesman Greg Martin.

The administration said no decisions had been made on the size or duration of the new bailout plan, or what type of concessions might be demanded from the struggling automakers, their workers, stockholders or others.
In a reversal, the most likely rescue option under consideration involved billions of dollars originally ticketed for the bailout of the financial industry. President George W. Bush had earlier declared that money off-limits to the beleaguered automakers.

General Motors Corp. and Chrysler LLC have warned they are running out of cash and face bankruptcy without some form of assistance. Ford Motor Co., which is in somewhat better shape financially, has been seeking access to a line of credit.
Underlining its difficulties, GM announced Friday it would cut another 250,000 vehicles from its first-quarter production schedule -- a third of its normal output -- by temporarily closing 21 factories across North America. The move affects most plants in the U.S., Canada and Mexico. Many will be shut the whole month of January.

Urgent requests for White House intervention to save the automakers came from President-elect Barack Obama, Republican and Democratic members of Congress and outside groups.
"Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms," White House press secretary Dana Perino said after the failure of a $14 billion bailout bill in Congress. The legislation died when Senate Republicans demanded upfront pay and benefit concessions from the United Auto Workers that union officials rejected.
Perino added, "Given the current weakened state of the U.S. economy, we will consider other options if necessary including use of the TARP program to prevent a collapse of troubled automakers. A precipitous collapse of this industry would have a severe impact on our economy, and it would be irresponsible to further weaken and destabilize our economy at this time."

TARP is the $700 billion Troubled Assets Recovery Program, the financial industry bailout plan enacted in October. All but $15 billion of the first $350 billion has been dedicated to troubled banks or insurance companies, and the Treasury Department is barred from dipping into the second $350 billion without a formal notification of Congress.
No decision has been reached about such a notification, administration officials said. If one is made, Congress could then vote to prevent the action, but it would be unlikely to prevail in a showdown with the president.

Obama, who will inherit the problem next month, even if bailout billions are handed over in the meantime, said, "My hope is that the administration and the Congress will still find a way to give the industry the temporary assistance it needs while demanding the long-term restructuring that is absolutely required."
In a letter to Bush, House Speaker Nancy Pelosi urged the president to demand "the same tough accountability" and taxpayer protections from the automakers as was contained in legislation that cleared the House at midweek.

Michigan Rep. Thaddeus McCotter, a conservative Republican from a state where Ford, GM and Chrysler are headquartered, said, "With the legislative opportunities now exhausted, I urge the president of the United States to immediately release Wall Street TARP funds to the domestic automakers to avoid their impending bankruptcy and its consequent devastation of working families and the depression of our American economy."

It was unclear what role was left to lawmakers after an extraordinary week in which prospects for industry relief seemed to change by the hour.
A week ago, the government reported the loss of 533,000 jobs in November, the worst monthly showing in more than 30 years.

In the days between then and now, the White House and congressional Democrats agreed on a $14 billion measure that would have extended short-term financing to the industry while establishing a powerful new "car czar" to make sure the money was used to turn the Big Three into competitive companies. That bill passed the House on Wednesday but immediately ran into opposition from Senate Republicans who said it did not go far enough.
On Thursday, they demanded the United Auto Workers union agree to accept a lower pay and benefits package that would be in line with compensation earned by workers at U.S. factories producing cars for Japanese companies such as Honda, Toyota and Nissan. In an unprecedented series of negotiations, lawmakers met with representatives of industry and labor on the first floor of the Capitol in hopes of striking a deal -- the effort that ultimately collapsed when the UAW balked at the terms demanded.

At a news conference on Friday, UAW President Ron Gettelfinger accused GOP senators who blocked emergency loans of trying to "pierce the heart" of organized labor.

Sen. Bob Corker, R-Tenn., who played a leading role for Republicans, told reporters at the Capitol that the talks came close to success but failed when the UAW refused to commit to lowering its pay-and-benefits package in 2009 so it would be "competitive" with the Japanese companies -- a lower threshold, he said, than his previous demand that wages and benefits be "at parity" with foreign counterparts.
He also laid blame at the feet of the administration. "I think it being known that the White House at the end of the day would probably blink probably helped keep us from a deal," he said.

Whatever the reason, the effort stalled when Republicans voted en masse against advancing the original House bill to a final vote late Thursday night.

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