USD INDEX

USD INDEX

1. US index is a leading indicator for indicate volume and movement in usd. It's good for using in any instrument against by dollar.

2. In my observation usd index more accurate with GBPUSD and EUROUSD.

3. In this hour GBPUSD look alike more into retracement phase. But according to US Index dollar should be strengthen and good for sell.

4. 1.598 will be a resistance for GBPUSD. Hence i dont think to go long, i prefer to short this pair once price ready to turn.

5. Becareful with buying thought, because it's obviously bearish bias. If you hold and overnight you buy i remind again please take care your position.

bullish bias, major to turn..

There are a few thought about the market sentiment after NFP release the result against the forecast. An unemployment become higher and make green back no demand. Certain trader thought this is reversal and certain trader believe this is usual retracement.

Ive been read a few comment and analysis from a several forumer especially in forexfactory.com. Most of them already sold at 1.607*.**. For me that a good decision, because according to my judgement it's definitely Bearish trend for major channel inside daily time frame.

How ever there is no right and no wrong in foreign exchange market. what you see is what you get.

similarity pattern on weekly. GBPUSD

For it's obviously bearish bias. i waiting the lowest on weekly break the price.. the there should be a little correction before down fall.. just patience. i just close my short , sell from top. Good luck.

head and shoulder

Not so nice head and shoulder, but i still indicate for reversal sign + doji

How Does Raising the Key Interest Rate Strengthen Currency?

The key interest rate (also known as the "prime rate") is the percentage that a central bank or monetary authority charges on loans to commercial banks. Raising this rate strengthens a nation's currency because it raises the returns on deposits in a given currency in relation to other currencies, as well as signaling growth in the economy and a decline in inflation.

Prime Rate

The prime rate of any country is controlled by a central bank or monetary authority. In the U.S., this authority is the Federal Reserve. A country's central bank is in charge of monetary policy, and one of its main tools is the prime rate. The Federal Reserve raises or lowers the prime rate to influence national savings, investment, employment, inflation and the exchange rate. The Federal Reserve usually operates on the basis of targets (for example, the target inflation rate is 2 percent).

Reasons to Raise

Raising or lowering the prime rate has specific effects on the economy. Raising the interest rate encourages savings, controls inflation and discourages borrowing and investment. The higher the interest rate, the more money you can make by simply saving (and if the population spends less, inflation proceeds at a slower rate), and the more expensive borrowing becomes. While all of these factors affect the exchange rate in different ways, it's the savings mechanism that immediately strengthens a currency.

Returns

Raising the prime rate raises the returns (the amount paid in interest) on deposits in that currency. When people can make more money with accounts in one currency as opposed to another, they will buy the more lucrative currency until the exchange rate adjusts to the demand. The exchange rate adjusts almost instantly since both buyers and sellers around the world are aware of what is going on, and buyers will immediately start buying while sellers will immediately start raising their prices.

Example

Assume that the euro and the dollar are at parity (one dollar buys one euro and vice versa), and both the E.U. and U.S. prime rates are at 3 percent with annual inflation at 2 percent. If the Federal Reserve raises the prime rate from 3 percent to 3.25 percent, and all else remains constant, deposits in dollars become 25 percent more lucrative than deposits in euros at that exchange rate. As soon as this happens, anyone involved in currency trading will switch their euros to dollars; however, this activity (high demand for dollars, low demand for euros) immediately pushes up the exchange rate because those selling dollars will start asking for more.

Other Signals

Raising the prime rate sends out a number of signals about a nation's economy. Raising the interest rate often signals strong economic growth, to the point where the central bank can make a move that discourages investment and raises the exchange rate (which makes exports less competitive). Raising the interest rate also lowers inflation and can show that the central bank is interested in controlling inflation, which often reassures investors.

GBPUSD daily outlook & mid-day outlook.

As we know last friday was awesome. Move from 1.6090 Breakout from london open was trigger the trend to reach support price at 1.6000. Yes i won, but because last friday is my 1st entry after almot 8 month silent from market without any blocking price so i was quite nervous while my position below 10 pips. :).

Here i post my chart for daily trend by using Elliott wave prediction. Some how if i analyze back the previous trend for last week, GBPUSD was move 450 pip without any big retracement. By using this case most of trader will expect the truly pull back from bottom. But until now i did not see any reversal sign. Hence i expect it could be break more lower until next support at 1.5905.



Chart above is more like charting technique without used any sense of indicator to indicate market direction. Hereinafter daily just break the fractal. Usually once price was break the fractal in daily 50% is continuous trend or 50% otherwise. I have observe this quite many year. But i dont think this is fractal noise.

If 1.5997 is a price breaking from trendline so i assume wave "a" just moved. Next hassle is 1.5818 nearly with parallel trendline and i expect reversal sign is there.

For this moment whant i can tell is just stay with bearish.



This is 1 hour chart.

Price still stick with channel discipline. I still used this chart to make my wise entry.

my idea is

Open sell at 1.5939.
Exit at 1.5905

However since the price is lower i think quite risk to keep selling. keyword is sell on top. but now is already lower and maybe we will face the next lower. I believe with my system.

Regards
Muhamad Yaqin Mhd Nor.
Chartist.

expected wise

Previous post was indicate how price moving inside channel, and it's proven again when 1.6090 become Resistance. Late friday GBPUSD just kissed 1.6000 as my expected rallies.

Nothing weird after this, it just pull back from 1.6000 and price will play within this range.

I still monitor weekly time frame. For this moment i still cannot give solid direction where are the market heading. Maybe on next week hope for more clear direction.

Happy weekend.

aroma of Q.Ezi..

the next support is 1.600. huh after quite a long time i never wrote about currency analysis, i felt so noob when i want to elaborate. Well this chart just tried to telling us now price is moving inside channel and 1.6 are waiting to kiss.

But how strong this volume to push the market, the whole week started from monday, market has been in bearish mode. Just a little retracement. Becareful with sudden pull back. But what ever it is.. i believe price will not go so far. If pull back it just to kiss trendline.

rgrds

It's not about the money, its about the game.

Shall i start with say hello trader ? or do i start with say Sorry guy's long time no snippet ..

Almost one year, yes one year without entry and writing, i really hope all my colleague has a great journey for this year. For a long time i try to seek the new things and new atmosphere, but it doesn't means i stopped to play Forex but i just slow down my trade.

However i am more into offline advising instead of keep posting my analysis through my blog. I followed GBPUSD started from January until today. For those who has a good technical knowledge especially in Trendline, Price action and elliott wave i recommend GBPUSD to applied your knowledge.

Fibonacci steady awesome tools. Magic number delivered their word, when mr Fibo said ok .. wait until 61.8.. and He do. All the practices which i just mentioned is not a system, but the system is apart of them. Human behavior equivalent to market behavior but not equal to trader behavior. Thats the thing emergence of supply and demand.

Regards.

Yaqin.

GBPUSD 2010 first touch

After a long period i stay away from the market,now im back to do the first touch at GBPUSD in 2010. What can i say in GBPUSD currently is a bullish mode and according to the fibonacci the price will trying to reach 100.00 FE. The previous highest is 1.62411 and i hope price will break this high. Nothing much to say. we see what market want. good price to buy is around 1.6110.