by Ntombi Malatsi | Aug 3, 2015 | FOREX FOR BEGINNERS, FOREX TRAINING
The most traded currency pairs in the Fx market:
Forex market is like a huge marketplace where investors buy stronger currencies and sell the weaker currencies. There are different types of currencies, but some currencies are traded more than others on a global scale, there are only a handful of currencies that are actively traded on the Forex market. Let’s have a look at the list of the most traded currency pairs in this market, currencies are traded in pairs hence we call them currency pairs, it is always one currency Vs another.
MAJOR CURRENCIES:
These currencies are paired with the Us Dollar and they are from major economies and they are highly liquid.
- Eur/Usd (Euro vs Us Dollar)
- Usd/Jpy (Us Dollar vs Japanese yen)
- Gbp/usd (Great Britain Pound vs Us Dollar)
- Usd/Chf (Us Dollar vs Swiss Franc)
COMMODITY CURRENCIES:
These currencies are also from major economies but they are called commodity currencies because they are heavily dependent on raw materials.
- Aud/Usd (Australian Dollar vs Us Dollar)
- Usd/Cad (Us Dollar vs Canadian Dollar)
- Nzd/Usd (New Zealand vs Us Dollar)
CROSS CURRENCIES:
These pairs are not paired with the Us Dollar:
- Eur/Jpy (Euro vs Japanese Yen)
- Gbp/Jpy ( Great Britain Pound vs Japanese Yen)
- Eur/Gbp (Euro vs Great Britain Pound)
WHAT ARE THE CONTRIBUTING FACTORS OF CURRENCY’S VALUE AND EXCHANGE RATE:
- Interest rates in the country increase the value of that particular country’s currency. The higher interest rates tend to attract foreign investment and therefore increasing the demand of the home currency’s value.
- Trade balance between imports and exports play a crucial role in the increasing of a currency value and exchange rates.
- Gross Domestic Products (GDP) is a big measure of economic health of a country and actually a gauge to a country’s standard of living, good or favourable numbers also increase the value of the currency.
- Country’s level of debt can be managed, but if not managed well it leads to higher inflation rates and that may trigger the official devaluation( deliberate downwards adjustment to the value of the country’s currency) as Forex traders we need to understand the world of currencies that we invest in before we can even think about investing money, education first. Thank you for stopping by, you are much appreciated, please do come around again and kindly share this post using the share buttons below.
by Ntombi Malatsi | Jul 20, 2015 | FOREX FOR BEGINNERS, FOREX TRAINING
Commodity currencies, what are they?
We all know about the majors and other types of currencies, but there are also those currencies that are referred to as commodity currencies/commodity dollars. Commodity currencies are heavily dependent on the export of certain raw materials. Listed below are the currencies which are raw material dependent.
Canadian Dollar (CAD).
Canadian dollar also nicknamed the loonie is highly dependent on oil since Canada is the second largest exporter of oil, the strength of economy depends on the prices of natural resources. The higher the price of oil the higher the loonie benefits, and the more disadvantaged the Us dollar becomes.
Australian Dollar (AUD).
Australia is one of the biggest producers of Gold, Iron, Aluminium and coal. GDP (Gross domestic products) is accounted for the falling and rising of gold prices. Australian dollar also nicknamed the AUSSIE or OZZIE is also dependent on this commodities, and by the way, trading Audusd is almost the same as trading gold, as the Aud follow the similar pattern to gold.
South African Rand (ZAR).
South Africa is also amongst the producers of Gold, the price of Gold is highly correlated to the price of the country’s currency, so there is a high correlation between Zar and Gold.
New Zealand Dollar (NZD).
New Zealand is not only dependent on one commodity, but a basket of a few. New Zealand is the big exporter of milk, meat and even fruits. New Zealand dollar is also nicknamed Kiwi. Commodity currencies are less liquid as compared to those currencies of the Uk ( GBP) and Japan (Jpy/Yen) or Euro Zone. When the interest rates are higher in Australia or New Zealand than Japan, the investors will then sell the Yen and purchase the Aussie (buy Audjpy) or they will sell the Yen ( Jpy) and purchase Kiwi (Nzd) buy Nzdjpy, they sell the weaker one, anyway this is what we do on the Forex markets, we buy the stronger currencies and we sell the weaker currencies, that is our general rule in Forex markets. here is to knowing a little bit more about the currencies that we trade. Thank you for stopping by, please share the post using share buttons below, more to come on currencies ,stay tuned.
by Ntombi Malatsi | Jul 4, 2015 | FOREX TRAINING
How to partially close a trade on mt4
Welcome back to my blog, thank you for being here. Today I am going to share a trick, I never knew it was possible until I did it myself. This is not a ticket to gambling or trading bigger lot size hoping you will close it partially, we all need to stick to the size that is well fit for our equity, in case you find yourself on the wrong side of the market while you traded bigger lot size, there is a solution to that, you can partially close a trade on mt4 successfully, below are steps of how to do it.
1.Double click on close (x) on your trade on the terminal as if you are closing it, (you have to double-click on the (x) otherwise the pop-up order window that will open, will not give you the option to close partially, refer to the screenshot below:
2.Change the size to your desired volume and click close, refer to the screenshot below:
Once that is done, observe your terminal and you will see the position will then behalf (if you did half), and on your account history you will see the partial loss closed at, and you can do this as many times as you want, basically you can close more than half, but please note that the stop-loss (s/l) and your take profit (t/p) will remain the same, it won’t be changed, that’s it, so simple. It is possible not only in the demo but live account as well. Thank you for stopping by kindly share the post to assist more traders out there.
by Ntombi Malatsi | Jun 28, 2015 | FOREX TRAINING
When and How to hedge Forex position.
Synonyms: buffer, cushion, shield, safeguard.
Definition: protecting yourself against financial loss.
How exactly does hedging work:
Welcome back to my blog, thank you for being here again, just a short article I thought I should post regarding hedging Forex position, now that we know the definition of the word I am sure we all want to know how we can use hedging as a protective measure, please note this is not a way to replace stop loss, but it can really help to prolong the”life” of your trade should it go against you, stop loss should be a trader’s best friend, trading without stop loss is like walking naked in eloff street Johannesburg totally exposed. Sometimes trades won’t go our way (it happens to all of us) and sometimes we really want to avoid putting stop losses too tight, so hedging becomes one more option that we can use to protect ourselves from being stopped out too early or losing too much on one position, it also reduces anxiety should you have bad trades. Before reading further, please note that this should not be taken as a financial advice or trading strategy of some sort, should you decide to use it, do it with precautions.
How to hedge:
Hedging Forex position should not replace stop loss, but in case you find yourself on the wrong side (like we do sometimes) you can try it. I do this from time to time, and please note that I am not giving you a trading strategy here, it should not be used as a trading strategy, I am however just sharing my journey with you as I always do and if somehow you find yourself in the similar situation whereby you enter a trade and it goes against you, then you can try hedging, it does protect your account from being blown out of the market, precaution needs to be exercised when hedging Forex position as it may require big enough account, especially if you are trading CFD’s which then charges commission on most platforms. This is how I usually do it, lets say you have a Long Eurusd on H4 chart and as we know that the market is forever moving, swinging up and down and swinging up again before you can reach your target, along the way while you have your Long Eurusd a Shorting signal opportunity might arise on a shorter time frame, what do you do then? do you ignore the opportunity? do you close the long position you have (which is at a loss because the market is against you), i always seize the opportunity and go short on the same currency pair but do a bigger lot size than the initial position, if the initial position was 0.50 I would then go and do 1.00, but as mentioned above that you have to have a reasonable equity to be able to hedge, and having same currency pair opposite each other create an opportunity to kind of “cancel” the loss, or give your initial position a chance to come positive without being stopped out too early. If the position you hedged with come positive, you can then close the initial position and take a loss,you might still take a loss even when you hedged, but the losses would be more minimized than if you didn’t hedge or you can end up with small profits, but that is better than being stopped out or taking huge losses. That is how I do it, it is my own experience, but stop-loss remain my number one shield and it helps to stay disciplined.
Please also take note that not all the Forex bloggers are Forex traders, some information that we read out there does not really apply when trading real money, so learn to do more research whenever you come across a Forex blog post. On the other hand, though, all that you read on this blog is my own personal experience, I talk about what I have experienced in my trading journey. Thank you again for stopping by and reading my blog, if you wish to receive my weekly posts you can subscribe (locate the “SUBSCRIBE TO MY BLOG“) on the sidebar, simply put your email address there,wait for confirmation email, click on the link sent to your email to confirm your subscription and every time a new post is published you will have it delivered to your email, do contact me for further assistance or private lessons, kindly share this post using the share buttons below if you find this information valuable, stay tuned for more…
by Ntombi Malatsi | Jun 16, 2015 | FOREX FOR BEGINNERS, FOREX TRAINING
When Is The Best Time To Trade Forex?
Have you ever asked yourself why is it that sometimes the Forex market seems “sleepy” whatever you try to do seems like you are just wasting your time and efforts? now is the time to find out why. I have people asking me sometimes how do I cope with training others, running this blog and at the same time manage to trade my own account, it is simply because I do not just trade at random times, I choose my markets wisely, there are times that I do not trade.
It has been said that the Forex market is open 24 hours, 5 and half days a week, but still there are times when you just have to stay away from the Forex markets. It might seem like it is not important to know the best time to trade Forex, but it is.
=====>Trade with regulated brokers here.
When Should You Trade Forex And Why?
The best time to trade Forex is when the market is active which then means more volumes of trades are being made on the market. Actively traded markets create more opportunities to trade and make profits while calm and slow markets will actually waste time and efforts, they are kind of”sleepy”.
Many traders are not really taking this into consideration, they just trade at any time because of the fact that the Forex market is open 24 hours a day, but the truth is there are good and the not so good times to trade, some traders know this but they choose to ignore it anyway. Before we can talk about the best time to trade Forex, there are 3 things that I think every Forex trader should adopt:
- Make profits
- Keep profits
- Repeat
Forex Market Hours
The Forex market has no physical location where all the buying and selling take place, therefore it allows anyone from any part of the world to participate, when one market closes another market opens giving everyone across the globe an opportunity to get their share of this trillion-dollar pie, but you have to know the best time to trade Forex.
The Forex market consists of four sessions, they open and close at different times, see table below.
Now that you know the opening and closing times for each Forex market, you can make informed decisions on when will be the best time to trade Forex for you.
If you need to open a live account, for the safety of your funds, do it with a regulated broker HERE. For further assistance in terms of selecting the best broker for your personal needs, you can WhatsApp me on +27 78 144 6851
For more information on my private mentorship, see this post HERE.
It is also reported by many traders that EUR pairs and GBP pairs are mostly traded during the London session, till we meet again , thank you for stopping by and reading my post.
I hope you find this helpful, if you do please feel free to share it using the share buttons below.
by Ntombi Malatsi | Apr 30, 2015 | FOREX TRAINING
How Does Gold Relate To Currencies:
Just a short article on Gold, (Xau) One thing I love about financial markets is that there is so much that one can trade except for the major currencies, traders can find what works for them, take for instance S&P500 and Dow Jones, those two are highly correlated, when one is down the other one is down as well and when one is up, so is the other one, there is power in understanding such relations, knowing how currencies, indices, and commodities relate to each other can save you from doubling up your risk in case your trade goes against you and you have unknowingly traded the”same”thing. Any Forex trader can learn how to trade gold and Usd.
There are few things though that we need to keep in mind when trading gold, firstly we need to understand how it correlates with the currencies like Eur and USD, meaning how it relates to those currencies. Gold is denominated in Us dollar but widely used in global markets and by central banks of foreign countries. As the price of dollar weakens, the price of Gold increases, simply because investors tend to dump the dollar in favor of gold during the times of economic stresses. Most Forex traders know that Gold and Us markets tend to move against each other, strong and reliable correlation right there, they form opposite signal almost all the time, when gold gives a buy signal the Us dollar gives a sell signal, and the signal that is formed ahead of the other one, can also be used as an indicator to trade the other one, when Us Dollar sells off heavily, gold rises, and so is Eur, it rises as well since Eur and gold are known to be “anti dollar”, in many cases a support/resistance level breakout in gold is often followed by resistance/support breakout on Us dollar. Understanding these correlations is very powerful and can have great impact in trading gold successfully and profitably. What you can do is, open both gold chart (same time frame) and USD chart at the same time, study them both and you will eventually see or confirm this correlation, it is not as difficult as you think, see images below. If you want to start trading Gold today, REGISTER HERE. Thank you for stopping by, please do share the post using the share buttons below. For private lessons, you can check HERE.
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