Forex Investment and Currency Trading

It’s one thing to speculate in the market and get the direction wrong. That’s good old-fashioned risk-taking, and it’s just part of the business of trading. But it’s another result entirely to get the direction right and still lose money, or not make as much as you could have, or not keep as much as you’d already made.
Most traders can readily accept the idea of getting the direction wrong. They shrug it off and get back to work in short order. But take a trader with a winning position in the morning that goes south in the afternoon, and you’re [...]

FX Bottom Line: If the S&P 500 Index manages to form a bottoming pattern against last Thursday’s bullish key reversal low of 818.91, the DXY is likely to undergo a retracement phase that would highlight support levels at 84.45, 83.82 and 82.32. Keep an eye on this relationship this week.
The possibility is raised that the S&P 500 Index is attempting to stabilize against last Thursday’s (bullish key reversal) low of 818.91.
With a potential triple bottom pattern forming near 845.27 for stocks, a close above resistance at 940.73 would produce a bullish trend reversal.
This would then highlight the reaction highs near 1007.46 [...]

USD
Senate Democrat leadership proposes $25bln auto aid bill; loans would have 10-year terms; US government would get warrants or senior debt instrument in recipient company; Senate bill would also allow loans to auto industry component suppliers. Secretary Paulson noted solid progress has been made in stabilizing US financial system but it will take considerable time to restore it to health. European equities are trading lower, in sympathy with the overnight losses in Asia and the Americas. However, despite this, JPY has not made the kind of gains that have been seen recently following sharp equity losses. Though the core trading themes [...]

Leverage is the size of a market position you can control based on your available margin collateral. If the leverage ratio is 10:1, and you have $1,000 of available margin, you’re able to hold a position equivalent to $10,000.
Online currency trading firms typically offer higher leverage ratios than you may be familiar with from trading stocks on margin. Leverage ratios among currency brokers are typically on the order of 100:1 for standard-size accounts (100,000 trade-lot size) and 200:1 for mini-accounts (10,000 trade-lot size).
Leverage is a great trading tool, allowing traders with less capital to participate in markets that they couldn’t [...]

CAD
We saw a fairly wide range overnight in USDCAD, as stops were cleaned out on either side of the market in both Asia and London. After the G20 summit provided little for the market to digest, stops were triggered above 1.2400 and we once again stalled at the 1.2425 level in Asia, only to see much of this move retraced in London. With no data out of Canada today, we’ll be focused on the North American equity reaction to the G20 statement. Later this week we get a speech from BoC Governor Carney as well as CPI for October. While [...]