Forex Currency Movement

FX trading Dealer Members

2008-07-09T08:17:00.000-07:00

The individuals literally make the Forex market. Without individuals literally there would be no trading opportunity for the retail investor. They extend the credit, handle clearing, back officer operations, and provide an orderly market for investor.

A FX trading dealer combines the roles of a market maker and specialist in the equity market. The primary role of the market maker is to provide liquidity through tradeable prices to the market. The specialist’s role is to intervene in the market when temporary price disparity occurs. Forex market makers provide liquidity and maintain an orderly market. When a retail trader sees a quote on his screen, it is coming directly from the Forex dealer member, and that person functions as the counterparty.

Retail Forex traders don't trade directly in the traditional interbank markets, even though many Forex firms claim their clients do. A trader is dealing in the interbank market if the counterparty is one of the major global financial institutions with trades starting at 1000000. Retail traders, however, have neither the trading volume nor the credit rating to trade on the interbank. That’s what makes them retail forex traders. What the retail trader is trading in is a limited offshoot of the larger interbank market.

In competitive of today retail environment, traders trade on quotes closely mirroring interbank prices provided by their Forex firms. Each Forex firm receives prices from outside providers such as EBS or Reuters or the banks the firm trades with. Most larger Forex firms trade on the interbank market with banks such as Deutsche Bank, HSBC, and JP Morgan.

Each Forex firm has a market maker who reviews the feeds from outside agencies and creates a price to offer to its clients. This is which called Forex market making.

One of the supposed advantages of the Forex market is its liquidity. But perhaps this liquidity is just a mirage—as was recently addressed by some major financial institutions at the FX Week 2004 Congress. First, the Forex retail dealer has no fiduciary or legally binding obligation to provide liquidity and an orderly market in extreme conditions. In fact, most FCMs specifically address this in their account-opening documents. In extreme market conditions, the retail trader is vulnerable because he is dealing with a single counterparty. If the counterparty does not offer the retail trader executable prices, he is stuck. The second reason, which is a major concern for the interbank participants, is that the amount of leverage extended to retail traders soon outpaces actual trading activity. This is not a major concern as long as buyers and sellers are relatively balanced. If they get out of balance, however, there could be a significant liquidity crisis.

In this process some conflicts arise. Because the trader can deal with only one counterparty, he is limited to accepting the price (or not trading) and is subject to the firm’s ability to trade. But the dealer knows the trader’s position and account information, often making it easy to figure out his next trade. This gives the market maker a significant advantage. Strange spike-hitting stop orders can make the trader think. In addition, this mechanism gives the Forex firm’s market makers flexibility in providing quotes.

Forex Regulators, Forex terminology

2008-07-08T17:09:00.000-07:00

No overarching global agency is responsible for regulating the activity of FX markets. Regulation is left up to each country. Some countries take a hands-off approach to regulations. Others, like the USA and UK, have jumped in with both feet.

SFBC

SFBC is The Swiss Federal Banking Commission..

IDAC

IDAC is The Investment Dealers Association of Canada.

SFC

SFC is The Securities and Futures Commission.

FSA

FSA is The Financial Service Authority.

ASIC

ASIC This is the Australian Securities and Investment Commission.

CFTC and NFA

In USA, the Federal Reserve Bank monitors the banking system. CFTC (The Commodity Futures Trading Commission) has jurisdiction over futures and, recently, the FX markets.

The government agency CFTC monitors NFA (the National Futures Association’s) activities. The CFTC has limited regulatory authority over retail over-the-counter (OTC) Forex markets in the U.S. But although no single entity in the U.S. has direct regulatory oversight in the Forex market, the CFTC has effectively begun to take on that role.

CEA is (The Commodity Exchange Act) gave the CFTC the authority to regulate the sale of OTC Forex futures and options to retail clients only if the counterparty is a regulated entity. Regulated entities include banks, financial institutions, brokerdealers, and FCMs. By limiting the parties regulated entities can interact with, the CFTC has exerted some level of control. The CFTC has the authority to shut down unregulated Forex entities— specifically, FCMs. "Also, the CEA has a provision for any violation regarding antifraud and antimanipulation connected with OTC FX transactions in the retail market."

In spite of the reputation that markets dislike regulation, this has not been the case with Forex. Most Forex firms have embraced the new regulatory authority because it gives them legitimacy and helps weed out fraudulent players in the Forex markets.

NFA

Since the CFTC is a government agency, it doesn't issue actual rules for FX transactions. It gave that right to the NFA. The NFA is a USA.-based, industry-wide, self-regulating organization. NFA was formed to provide regulatory programs, oversight, and market integrity primarily to the futures market but has now entered Forex trading world as well. Basically the NFA makes the rules that govern the Forex market—but remember, rules are not laws.

And now,today, anyone who participates in the Forex markets should deal only with firms that have some level of NFA designation. Despite of the NFA has done an impressive job of convincing a majority of the industry to register with the organization, not all firms are members. Technically, these firms are unregulated, so I advise you to avoid them. Determining whether a firm complies with the NFA should be an elemental part of your background research.

Tools of forex trading, your personal computer

2008-07-08T15:23:00.000-07:00

The forex trading tools such as a trading account and charts, but your owner computer is an important tool in your trade.

You need a quick computer in your forex scalping, but the lame computer with slow Internet speed can't walk

As a Forex trader you need your charts to display the date price, and you need your brokerage software to execute a trade promptly. Even with the best computer and fast Internet connection you will still have some lag time (not to mention how long it takes for you to move your mouse and click to begin a trade day). Often as a scalper you’ll experience missing out on a few pips (of lost profit) because of slight inefficiencies (somewhat frustrating at times), but if you have to deal with a painfully slow computer and slow Internet connection speed then you will soon be tempted to introduce your computer to a sledge hammer. In the forex world lost seconds means lost pips which means lost profits. Even in a single day of trading forex this can add up to hundreds of US dollars, even thousands, of missed profits.

The first thing to do be sure that your computer is running your trading tools easy, faster and correctly is to not have any other programs running on your computer while trading. because this maybe open eats up your computer’s resources, which can mean that your charts are not refreshing as fast, and it may take long time to execute a trade.

Global Forex Trading(GFT)

2008-04-17T19:27:00.000-07:00

Global Forex Trading (GFT) was founded in 1997, GFT give us the real time currencies dealing, currency pricing and the comprehensive services for retail and institutional forex traders. GFT present services to global customer by its Deal Book 360 trading software, that was named Best Foreign Exchange Software in the prestigious of Trader Monthly Awards of year 2006. GFT work 24 hours of forex trading operation that with its world headquarters in Mich, Ada and the global offices in the towns Chicago, New York, Sydney, Tokyo, London and Australia.

(GFT) Global Forex Trading, Division of Forex Ltd and Global Futures. Global Forex Trading is part of a group of privately held companies that included all owned subsidiary and the financial derivatives dealer, GFT Global Markets UK Ltd. Gary L. Tilkin is the leader of all that companies. He has earned many awards inside and outside of the industry of financial services.

Global Forex Trading is:

- CFTC (a registered futures commission merchant with the Commodity Futures Trading Commission)

- A registered broker–dealer with the U.S. Securities Exchange Commission

- FSA (holds a license with Japan's Financial Services Agency)

- ASIC (holds a license with the Australian Securities & Investments Commission)

Global Markets is regulated and authorized by the Financial Services Authority.

Forex Currency Movement

FX trading Dealer Members

Forex Regulators, Forex terminology

Tools of forex trading, your personal computer

Global Forex Trading(GFT)

Easy Forex

Easy forex has 9 main offices locations around the planet. It was licensed in USA, EU and Australia. For more info you can visit http://www.easy-forex.com/

Marketing Project Manager, Easy Forex [Jason Ballor] said, the contest is simple to play and simple to win.

Where to Set the Stop Loss

When to exit a trade forex

When to enter a trade forex

Trade Recording (Forex trade recording)

To Increases drive currency price

Short Term ‘Scalp’ Trading the 1min Charts

Risk Management, forex risk management

Recommendation - Model of a Direct Trading Operation

Periodical change of Forex Trading Partners

Market Characteristics

Forex, Payment and Settlement Systems

Foreign Exchange, The various parties involved

Benefits fo forex trading, Why Trade Forex?

Automatic check for forex trades with unusual characteristics

(OTC) Over-the-Counter vs. Exchange-Traded Segment