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Sunday, May 29, 2011

Economic Prospects

Probably too early to make or predict what happens to the world economy in 2010. But, the signs are already visible koq since the last 3 months in 2009. This article may be one of your guidance in trading Forex at the time & the years ahead.

There is an interesting approach in which the foreign institutions that are not our ears such as Standard Chartered Plc, Aletti Gestielle SGR, HSBC Holdings Plc and Scotia Capital Inc., said the dollar would depreciate as much as 7.1 percent against the euro. Even if the Fed is still raising interest rates even though, the dollar will continue to decline. Currently, the value of fiscal and monetary stimulus United States has reached 12 trillion and do not forget, the value of debt from the sale of American bonds have reached $ 4 trillion for the period 2009 and 2010 would cost currency. America's unemployment rate as of last October has reached 10.2% which makes many market analysts believe the economic recovery in America may be weakened.

"History tells us dollar for dollar should not hold too long until 12 months after the Fed began to raise interest rates" said Callum Henderson, an analyst at Standard Chartered in Singapore. Bloomberg's best analysts predict the dollar will weaken to 5.4 percent to $ 1.58 per euro by 2010, from $ 1.4944 today (23 November 2009). "It takes time to drain the excess supply of dollars from the market," said Henderson. "The dollar will remain weak despite Fed interest rate rises above competitors'.


The U.S. will be one of the five economic regions in Group 10 for wait rising interest rates at a meeting in mid-2010, according to the median forecast in a Bloomberg survey of 60 economists. Fed, European Central Bank, Bank of England and Swiss National Bank will raise interest rates in the third quarter of 2010 and the Bank of Japan will maintain interest rates at least 0.10% until March 2011, based on the survey. In late 2010, only Japan has the lowest interest rates because they are still tangled in inflation. U.S. interest rate target in 2010 is 1%, compared with a passion the ECB will raise interest rates to 1.5 percent of the European Union.

U.S. borrowing costs would make dollar-based assets less attractive, said Camilla Sutton, director of foreign exchange strategist at Scotia Capital, Toronto. Bank of Nova Scotia, the best predictor CHF currencies, predicted in 2010 will end with a weakening U.S. dollar at $ 1.60 per euro.

"The dollar will lose the opportunity to plan the race a short distance inter-bank interest rate hikes and then would lose track marathon / long term," said Sutton.

Lessons of history

After the Fed raised interest rates, the performance of the dollar probably will mimic the pattern of three previous periods, said Henderson. Once policy makers began to increase borrowing costs in July 2004, the Dollar Index fell 10 percent and could not go back to where it was before the first increase and stayed there for more than a month until November 2005.

Intercontinental Exchange Inc. 's measure the dollar fell 6 percent and takes seven months to recover after the Fed raised interest rates in July 1999. In 1994, the dollar dropped 16% and reached the point of origin in 1997. In summary, based on technical observations, the dollar will weaken against the euro, yen, Swiss franc and Swedish krona on September 30, 2010. The pound sterling and Canadian dollar, will surpass the dollar amounted to 0.3 percent and 2 percent.

Limiting Liquidity

Twenty-four of 37 predictions for the end of next year has a strengthening U.S. dollar against the euro. The median is $ 1.47, up 1.7 percent. Twenty-seven of the 31 strategies also see the Yen will be "battered" 13.6 percent to 101 yen from 88.87 today, November 23, 2009.

"The dollar will gain support immediately after the Fed began to control liquidity," said Lee Hardman, an analyst in London at Bank of Tokyo-Mitsubishi UFJ Ltd., Japan. Dollar rose 10.7 percent would be $ 1.35 per euro by the end of 2010, according to predictions the Bank of Tokyo-Mitsubishi UFJ Ltd..

Global Growth

"Financial markets and stock markets have been too optimistic about economic growth next year," said Gernot Griebling, a bank analyst at Stuttgart, Germany. "The risk of rejection should rise again," by analyzing the dollar will strengthen to U.S. $ 1.37 on 30 September. For now, the global recovery is on track that you want, based on observation of the Organization for Economic Cooperation and Development, Paris, world economic growth could reach 1.9% in 2010 and 2.5% in 2011. The recovery here means to encourage investment in higher currency-like stock by selling dollars.

Dollar Index has fallen 15.5 percent since March 5, 2009, a very steep decline for 23 years. The decline occurred from four days before the Standard & Poor's 500 Index rallied since the start of the 1930s, rising 60%. Fed Chairman spoke on 16 November 2009 and that "significant economic challenges remain" in the United States and repeated the Federal Open Market Committee will keep interest rates fixed for a certain period.


Policy makers might not change direction until the year 2012, according to a statement James Bullard, St Louis Fed President on November 18, 2009.

"If you look at the last two recessions, in each case, the FOMC to wait 2 1 / 2 to three years to raise interest rates, said Bullard.

It seems from what was submitted this article, an analyst at Standard Chartered's Henderson and Sutton Scotia Capital will become a reality, that the depreciation of the dollar will reach $ 1.50 and $ 1.60 per euro in mid-2010.

The dollar will weaken, as its status as a reserve currency and the public deficit, "said Sutton, a former finance manager of the Ontario Municipal Employees Retirement System.

Budget Deficit

U.S. budget deficit hit a record $ 1.4 trillion in the fiscal year ended September 30, 2010. Debts amounting to 9.9 percent of the economy, up from 2004 which is an average of 3.5 percent. Central banks revealed that they prefer to put 63 percent of their new money into the euro and yen in April, May and June 2009, and its value has reached $ 80 billion, according to Barclays Capital data.

Henderson saw similarities with 2004, when the Fed has lowered interest rates below the ECB's overnight.

Recession in 2001, caused by the fall of technology stocks, pushing the U.S. to cut interest rates 5.5 points to 1 percent in June 2003, a dot below the euro area. Fed holds 1% interest rate until June 2004, more than two years after the recession ended. Dollar began to regroup after beating rate of the ECB to raise interest rates to 2 percent in December 2004.

"If the peak of the crisis in 2001 and 2008, the weakness of the dollar will end in 2011," Henderson said.

When the Fed started tightening, the dollar continues to weaken "said Ray Farris, head of global foreign exchange research at Credit Suisse Group AG in London, the euro-dollar fortune teller world's third-best." This is really just a matter of tightening in the final stages of the Fed when U.S. interest rates relatively high and the dollar will stabilize and then recover. "

Dollar falls fell to its lowest point at $ 1.6038 in July 2008, when the ECB's interest rate reached 2.25%. Then after that, the euro weakened after Lehman Brothers Holdings Inc. filed for bankruptcy in September 2008. Investors then holding the dollar and the yen to find the safe side.

There is an interesting word spoken from Jens Nordvig, managing director and chairman of the G-10 experts at Nomura International Plc in New York, Japan's largest brokerage firm: "Nothing in the cards from the point of monetary policy that could persuade me to become a seller of dollars in the year 2010 ". Nomura International Plc is a Japanese broker bought Lehman Brothers assets, Europe, Asia and the Middle East in 2008.

Belajarforex Says

At least there is disagreement in which Standard Chartered Plc, Aletti Gestielle SGR, HSBC Holdings Plc and Scotia Capital Inc., said the dollar will weaken devastating in 2010 and Nomura International Plc who fear the dollar will go up after a new financial crisis in 2010.

We, still think the dollar will weaken to as low as 1.6040 in the year 2010, though not absolutely 100% going to climb, but no effect of 20-80, ie every 80% increase in Euros there will be 20% of the strengthening dollar go to the left, and so on .

Oh yes, Forex koq suitable for intra-day traded. As a reference, use the time frame for D1, add indicators Bolinger Bands & Stochastic oscillator yes ...

Following mechanism:

Open Stochastic oscillator parameters 10; 5; 5,

Take it from the Insert menu of indicators, indicators, oscillator, 10, 5, 5,

Make Stochastic oscillator as an indicator of trends.

Open Bolinger Bands from the Insert menu, Indicators, Trend, Boliber Bands, period 20.

Bolinger top line: line 1

Bolinger middle line: 2 lines

Bolinger bottom line: line 3.

If the price (look at the candlestick) is translucent line 1: Open Sell, Kalo prices (visible in the candlestick) is translucent line 3 means good for open Buy.

Buy the best signal is when the price will not leave the area 20 from bottom to top.

Sell ​​signal is best when the price is going to leave the area 80 from top to bottom.

Happy trading.

1 comment:

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