Is An Automated System Necessary To The Forex Trading System?

By Todd Joyner

How valuable is an automated system to the Forex trading system?

Before we answer this important question, let us talk about how big the Forex trading market is. From there, we will discuss the value of automated systems for the Forex trading market.

You name it, we've got it. Take a look at the following:

BANKS- they are not just for saving money and lending capital to entrepreneurs, but they are one of the major players in Forex market. Banks cater both to large quantity of speculative trading and daily commercial turnover. Well-established banks can trade billions of dollars worth of foreign currencies everyday. Some of the trades are undertaken on behalf of their clients, but most are through proprietary desks.

COMMERCIAL COMPANIES- these commercial companies trade small quantities of foreign currencies compared to larger banks and their trades produce small and short-term impact on the market rates. However, the trade flows from transactions made by commercial companies are essential factors with regards to the long-term direction of the exchange rate of a certain currency.

CENTRAL BANKS- central banks play an important function in the Forex market. They have the control over the supply of different currency, inflation, and interest rate. In addition, they have also official target rates for the currencies that they are handling. They are responsible for stabilizing the Forex market through the use of foreign exchange reserves. Their intervention in the market is enough to stabilize a certain currency.

INVESTMENT MANAGEMENT FIRMS- these firms commonly manage huge accounts on behalf of their clients such as endowments and pension funds. They are using the Forex market to facilitate transactions, specifically in foreign securities. For example, an investment manager bearing an international equity portfolio needs to purchase and sell several pairs of foreign currencies to pay for foreign securities purchases.

RETAIL FX BROKERS- they handle a fraction of the total volume of Forex market. A single retail Forex broker estimates retail volume of between 25 to 50 billion dollars each day, which is estimated to be at 2% of the total market volume.

SPECULATORS- these are individuals who purchase and sell foreign currencies and profit through fluctuations on its price as opposed to popular methods such as interest and dividends. They perform the important role of transferring the risk to individuals who do not wish to bear it.

In the Forex trading market, there are already six major players partaking on the $1.8 trillion worth of daily turnover. With a large number of Forex trading players, there is really a vital need in switching from manual to automated Forex trading system.

Among the aforementioned major Forex players, the automated trading system is a great advantage to the speculators. Since they focus on the price fluctuations of various foreign currencies in order to profit, the real time data analysis will help them determine trades that will give advantage to them.

There are several automated Forex trading systems available in the market. There are also automated Forex systems that are offered for free or as part of their trading account acquired from their Forex brokers or agents. Such complimentary system packages are typically elementary trading system. Thus, if you are looking for more features, you can avail of it through additional payments.

There are two types of automated Forex trading system. These are discussed in the following:

Desktop system- all Forex-related data are stored on your desktop's hard drive. This system is unpopular to Forex traders because all data are susceptible to computer virus contamination and other security problems. Worse, when the computer malfunctions, all essential information might be lost and cannot be retrieved (unless you have some back-up files of your own). However, it is little expensive compared to the other types of automated trading system.

Web system- the security of your Forex account and other data are provided by your web-based provider. These are hosted on secured servers. It is also very convenient in the fact that there will be no software required and it is compatible with your Internet browser.

You may also try different Forex automated trading system demos first so that you will be able to determine the automated Forex trading system that suits your personal preference and needs.

Even if you are just a small-time Forex player, it will be to your advantage if you will use an automated Forex trading system for your future trades. - 23222

About the Author:

Looking to find the best deal on Forex Automatic System Software, then visit the best Forex Trading website for all your Forex trading needs.

US Dollar (Part II)

By Ahmad Hassam

The Federal Reserve Board (FED) is responsible for making the monetary policy of United States. FED sets and implements the monetary policy through its Federal Open Market Committee (FOMC). The voting members of FOMC are the seven governors of FED plus five presidents of the district reserve banks. Eight meeting of FOMC are held every year. These meetings are widely watched by the analyst for interest rate announcements and changes in growth expectations.

FED uses the monetary policy to control inflation, unemployment and balanced growth. FED has a high degree of independence in setting the monetary policy. FED has the mandate for long run price stability and sustainable economic growth. In other words, fighting inflation and unemployment are the two most important jobs of FED Chairman. The most important tool used by FED is its Open Market Operations.

Open market operations involve FEDs sale or purchase of government securities that includes treasury bills, notes and bonds. In increase in FEDs purchases lowers the interest rates while selling of these securities raises the interest rate.

The primary interest rate that is affected by these operations is the Federal Fund Rate. Federal Fund Rate is the key policy target of the FED. It is the interest rate at which the banks lend overnight to one another.

Fiscal policy means the amount of taxes and government spending for a given year. The US fiscal policy is in the control of US Treasury. In fact it is the US Treasury that actually determines the US Dollar policy.

You should always try to watch the US Treasury views as changes to that view is very important for the currency markets. For example, US Treasury can give instructions to the New York Federal Reserve Board to intervene in the forex markets by actually buying or selling US Dollars if the US Treasury feels that the US Dollar is under or overvalued.

The heavily traded currency pairs in the global currency markets are EUR/USD, USD/JPY, GBP/USD and USD/CHF. These currency pairs represent the most frequently traded currency pairs in the global markets. So the most important economic data for the global currency markets is the US Dollar fundamentals. Over 90% of all currency deals involve the US Dollar. As you can see, all these currency pairs involve US Dollar on either side of the pair.

The relationship between Gold and US Dollar is very important for you to understand. There is an almost perfect negative correlation between the US Dollar and the gold prices. The US Dollar moves in opposite direction to the gold. This inverse relationship stems from the fact that gold is measured in US Dollars.

Gold is commonly viewed as the ultimate safe haven commodity by the investors all over the globe. When US Dollar depreciates due to global economic uncertainty like the present, gold appreciates. You must know that the gold prices are going up right now. - 23222

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!

Why World Currency Matters

By Adela Thomas

When Understanding Finance, it is very important that you recognize the pros and cons of any system. This not only is limited to your own system of recognizing what is important to you, but also a much more broad category of finance. You should understand as much as possible about the subject of money in order to really know what the best use of your time and money is.

You can learn all about various things such as monetary policy, the history of money, various currency, reserve currencies, the dollars function in global economics, and the possibility of an international currency, and what role a reserve currency globally has on the economy under various monetary systems.

The world currency refers to which the vast majority of international transactions take place and which serves as the world's primary way of receiving money. In March 2009, as a result of the, have pressed for urgent consideration of a global currency and panel has proposed greatly expanded the reasons for having great supplies of money. The countries of the world, all, require money in some form or the other.

It is undeniable and must be received in order for a country to survive. The world's currency has many faces, and denominations. From the US Dollar to the Israeli Shekel, the colors, the shapes, the varieties are as different as the people of the world. The currency that is used the most has to be the US Dollar. Some of the currency that is in the world today is as a piece of art, beautiful, sometimes not the value of the paper printed, but still a work of art.

One of the reasons the dollar is so valuable, is because it has reserve status. The Bretton Woods agreement called for a reserve currency around the world that would be held by all for stability. At the time, the dollar was 100% backed by silver and gold, however as it stands, it has lost that security. Fortunately for the world economy, the US government has shown its ability to produce and deal with periods of instability.

Unfortunately the danger that we are approaching is that the US may lose its status as a superpower as China continues to grow its economy and other nations around the world continue to grow. This should be a concern to your personal finances because if the dollar loses its reserve currency status, that means that the dollar will lose value, while things like gold, oil, precious metals and other commodities will maintain their value, increasing their value when priced in dollars - 23222

About the Author:

Adela writes about many topics related to businesses and financing. He teaches about various things including business, finance, and money market accounts.. You can also learn more from him about how to make money online

How To Choose The Best Forex Signal Software.

By Kareechy Ken

Everyone seems to think that they know it all when it comes to Forex software. You want the best. Yet, you might not know which one is really the best one. So, how to pick the best Forex software becomes the question. Keep reading and we'll tell you how.

The first thing you need to look into with the forex software is making sure all your personal information is hidden from the outside world. There are many hackers out there. You want to make sure you don't get your identity stolen. So, that is why they have encryptions so that your information is really your information. You will want to make sure that your software has this.

Therefore, the next things you need to look at are which ones allow you to ask questions and get answers? They should have an in depth detail on how the system works. It might be helpful if they have a tutorial so that you can see what things mean and how things work on their software. This should be done before you use it.

One thing that you want to make sure that they describe is how things work. One of those things is how do interest rates work? How are they applied and how do they affect you? These things should be covered as you look at how to operate their software. This will make sure how it fits into your account.

The next thing you want is someone there when you do have a problem. Part of how to pick the best forex software is to make sure that someone is on the hotline so that you can ask your questions. Make sure that the help line is open twenty four seven. This means you can get help anytime you need it. Also, ask what sorts of opeople work the help desk. Some of them on some software aren't any help at all.

The last thing you need to consider is foreign trade and international exchange. If they can't tell you how all this works when you are trading with their software, then they aren't for you. You want something made simple.

When you have located these things you have learned to pick which is best for you. How to pick he best forex software is something that you don't want to just say ho hum to and do as you want to do. You want to make sure you know what you are doing. You are investing your money into this. Therefore, you want to see it grow. That is how you do it. - 23222

About the Author:

Looking to find the best deal on Forex Signal Software, then visit forexsignalsoftware.net to find the best advice on The Best Forex Signal Software for you.

Secrets To Currency Trading

By Gene Minor

The recent activity of the stock market has drawn an increased amount of attention and attracting new investors, who probably are looking for tips and secrets to help understand what this new market is all about--currency trading. Right now is a good time to begin forex trading and investing if you are a new investor yourself.

The way of looking at the global economy is changed and will effect buying and selling in forex markets. Using a managed fund and permitting a money expert to manage your money may be a good idea if you have not done this type of investing before.

If managed fund becomes your cup of tea, you are freed from the stress and strain of getting glued to the computer for 24 hours and taking the trouble of tracking the rapid movement of the markets.

If you would prefer not to have a managed fund and learn the secrets to currency trading yourself you would most likely want to have a software system that is either web or locally based on your own computer. This type of system will constantly feed the data directly to you in real time allowing you to be vigilant of market changes and buy or sell almost instantly.

There are many automated software systems for currency trading and they are often used by forex traders. You can choose any one of these for your own use, but you must know that you cannot let the software decide for you and make the trade. You should be the one to decide when and how to trade.

The software provides you with the all the information that you need to know in order to make the transaction. To this extent it is an educational tool for you. It gives you all the information very quickly and on a day to day basis. As you become familiar with all the information that you get from the software, you will learn when to sell or buy.

Currency trading secrets for investors new to the forex are usually about using automated software as a way of training oneself in this market.

This does not give a guarantee of safety coverage to the investors but may assist you and once in a while may get you into a wrong track but the over all success rates is high. - 23222

About the Author:

If you want to find out more about this, make sure to check out How To Day Trade Online.