The U.S. market is much better prepared for terror

U.S. Treasury John Snow said on Thursday about a new terrorist attack against America, that if it happened, it would be less destructive for the U.S. financial markets than the attack of 11 September 2001.

While the interview program "Nightly Business Report", Snow said the U.S. authorities have worked hard with representatives of American financial markets, which actually closed down the national economy within a week or so after the attacks of September 11.

"I'm not sure we ever will be fully prepared for this, but we are certainly now much better prepared for such a tragic, horrific events, as were two years ago," he said.

A Snow interviewed after reports that Al Qaeda may be linked to the explosion on Thursday in Spain, which killed nearly 200 people and many more injured. The letter implied that the group, which is related to Al Qaeda, claimed responsibility for the attack.

In response to a question, Snow said that he did not think that the Spanish attack, which alienated the enthusiasm of investors in markets around the world, damage the national economic recovery. "I think that Americans understand how we are vulnerable to terrorist attacks, and that we stepped up the infrastructure, we have made it much more rigid and the prospects for a successful act of terrorism today is much lower," said Snow. "But we can not completely eliminate it, which is why we must always take care of our security," he added.

On other issues, Snow said he remains confident that China will move towards a more flexible currency by changing the current system of tying the yuan to the dollar. "I think they really want to do it. They realize that in order to be able to move for a revaluation, the flexibility that they say they intend to implement, they should strengthen the financial infrastructure," he explained.

China must create a package of their bad debts and sell them to investors as well as to strengthen its banking system, said Snow, adding to signs that they started to do so and recognized the need to tighten regulation of financial systems.

By (Reuters.com)

Indicators MACD, part 2

MACD gives a disservice signals from three main sources. These signals are a reflection of bull signals.

1. The negative divergence
2. Medvezhye crossing moving averages
3. Medvezhye crossing the center line

The negative divergence
Negative divergence is formed when a financial instrument increases or moves sideways and MACD declines. The negative divergence in MACD can take the form of a lower recovery, as well as direct reduction. Negative divergence is probably the least frequent of these three signals, but usually the most reliable and can warn about the possible maximum.

FDX graph shows a negative divergence when MACD formed a lower rise in May, a campaign set up a higher maximum at the same time. This was quite apparent negative divergence, and reported a slow dynamics. A few days later, the action damaged the rising trend line and the MACD formed a lower minimum.

There are two types of confirmation of negative divergence. First, when the indicator is formed of a lower minimum. In this case, to apply the traditional indicator of the "peak and troughs." With a lower peak and subsequent decline in the lowest, rising trend is changing for the MACD to bovine to bear. In the second, Medvezhye crossing moving averages, which is explained below, can act as a confirmation of a bear divergence. While the MACD traded above its 9-day EMA (exponential moving average) or pulse line, it is not turned down, and lower recovery is difficult to confirm. When MACD breaks below its 9-day EMA, it signals that the short-term trend for the indicator, and possibly diminishing the formation of a temporary peak.

Medvezhye crossing moving averages
The most common signal for MACD is crossing moving averages. Medvezhye crossing moving averages occurs when MACD declines below its 9-day EMA. Not only that these signals are the most abundant, but they are also the least reliable. Therefore, the crossing of moving averages must be confirmed by other signals to avoid false signals and rapid turn.

Sometimes a financial instrument may be in a strong rising trend and MACD will remain above its pulse line for an extended period. In this case, it is unlikely that will develop a negative divergence. Different signals are needed to identify potential changes in the dynamics. This situation occurred with MRK in February and March. The action was in a strong bull trend and MACD remained above its 9-day EMA for 7 weeks. When Medvezhye crossing moving averages, it was a sign of slowing down the upward momentum, which informs on the need to more closely monitor the technical situation for further evidence of the weakness of the dynamics. Weak momentum was soon confirmed, when the action violated her bovine trend line, MACD continued its decline and moved below zero.

Medvezhye crossing the center line
Medvezhye crossing the center line occurs when MACD moves below zero to negative territory. This clearly shows that the dynamics changed from positive to negative, or a bull at disservice. Crossing the center line can act as an independent signal, or to confirm the previous signal, such as crossing moving averages or negative divergence. As soon as the MACD has shifted to negative territory, momentum, at least for the short term, has become a bear.

The importance of crossing the center line will also depend on previous movements of MACD. If the MACD as a positive for many weeks, begins to decrease and then moves to the negative territory, it is seen as a bearish sign. However, if the MACD has been negative for several months, it breaks above zero and then below are more similar to the correction. To assess the importance of crossing the center line can be used traditional technical analysis, to see whether the change in trend, higher recovery and a lower reduction.

Schedule UIS shows Medvezhye crossing the center line, which was preceded, a 25% drop in shares of mu, occurring only at the right edge of the schedule. While there was little time after the appearance of this signal, there were other warning signals just before the dramatic falls.

1. After reducing the trend line support, formed Medvezhye crossing moving averages.
2. When action was restored after the decline, MACD did not even move higher pulse line, indicating a weak upward momentum.
3. The peak of the recovery movement was marked by a candle by the "shooting star" (blue arrow) and GEPom (gap) down with increased (red arrows).
4. After GEPa down, the blue trend line, continuing from April 1999. Has been violated.

In addition to the signals referred to above, Medvezhye crossing the center line occurred after the MACD is above zero for almost two months. Since September 20, MACD becoming weaker and the dynamics slows down. Breakthrough below zero to act as a final touch a long process of abating.

Combining signals
As with bychimi signals MACD, bear the signals can be combined to form a more reliable signal. In most cases, stocks are falling faster than the rise. It definitely took place, and UIS, and only two bear signal MACD. Using dynamic indicators like MACD, technical analysis can sometimes provide information about the impending weakness. While it may be impossible to predict the length and duration of reduction, identifying weak momentum traders can take a more secure position.

Following the publication of a profit warning in late February 2000., CPQ mark fell from above 40 up to below 25 for several months. Without the insider information to predict the profit warning was not possible. However, it seems, some traders began to close positions before the actual warning. Looking at the technical picture, we can see evidence of this closure, and a serious loss of momentum.

1. In January, the MACD formed a negative divergence.
2. Cash flow Chaikin January 21, changed to negative.
3. Also in January there MACD Medvezhye crossing moving averages (black arrow).
4. Trend line tyanuvshayasya in October, February 4, was violated.
5. In MACD on 10 February was Medvezhye crossing the center line (green arrow).
6. 16, 17 and 18 February, the support at around 41 1 / 2 was violated (red arrow).

It has been 10 full days during which the MACD has been below zero and continued to decline (thin red lines). On the day before GEPom down, MACD was at the lowest levels since October. For those who waited for the restoration of shares, the continued decline of momentum has indicated that the pressure of sellers has increased and is not going to shrink.

After carefully studying the historical situation, you can learn to better understand the present and preparing for the future.

In Part 3 will be considered the advantages and disadvantages of MACD.

Arthur Hill
www.stockcharts.com

Open positions in the spread pattern

Open positions in the spread pattern. Theory uncertainty

A risky act will always be appreciated at its true, anyone who tries not to risk going to die and did not know the price of sweet victory.

Until then, we have heard a lot of different ways of entering the market, all of them, each in its own way, given a guaranteed method of entry into the market. In this article we wish to consider a new option that is entering the market with the trend spread, the ability to spread open. So, first of all, I would like to draw your attention to the following, which catch the "peak", ie the highest point, the task is not quite so simple, even we can say is very difficult and sometimes impossible.

The challenge of entering the peak, the catch is that the peak maximum or minimum at broadside trend is very vysokoriskovannoy procedure. See Figure 1:

Figure 1 Figure EURUSD changing trends and the identification of maxima fracture.

Pay attention to the daily schedule for the EURUSD, the figure number 1, and in particular, to the turning direction of the rising trend or downward trend. Max or minima are marked by red crosses I have to learn the importance of prices in these locations, we had a horizontal line, which will be convenient to navigate within the meaning of prices and its components. This is precisely such moments we try to describe in this article and analyze the method of entering the market in order to catch the trend, with higher probability from entry into the market.

As we know every trader dreams that successfully enter the market, but the more he dreams of learning to catch it turning points and trends to go dry from the water, in the event of a change in trend. If all things were easy, everyone would do so and, accordingly, the market would not unfold. In order to learn how to enter the market, especially, need to change their views on the situation occurring in the district. That is, it is necessary to force yourself to think individually and not try to do, as do all. In fact, in itself, the time of entering the market during the period of change trend is very risky, and therefore, in the case of attempts to determine the trend, ie the direction of the trend can often overstay in one place and take no action, determining the direction of the trend. In this case, turn to catch up is impossible, because when you have to be defined trend lines of the market is already very late. Therefore, from this we can conclude that in the case of attempts to catch the maximum price change in the direction of the trend seems almost impossible, or in other words one can say that the probability of such a transaction would be approximately 20%. There are some methods that can increase your chances of success in such attempts. It is possible that over time they will become your constant companions, and you will be guided by this theory at work in the market.

Figure 2 the change of trends, a schedule for the day time on the EURUSD.

Look at Figure 2:

The following figure we have marked three points, which can be described as peaks in the change of the trend. Point number one signals the descending trend, despite the fact that the previous short-term trend could be called bottom-up. Point number two is the point of maximum change in the direction of long-term ascending trend, pay attention to the horizontal line running radius of the point number two, this line intersects the two bottom-up peak at two, and then change direction of trend occurred at a time . The appearance of such peaks may be due to a variety of external factors that cause, some kind of uncertainty on the part of large and small traders in the market. Consequently, the uncertainty of its traders allowed us to use two attempts to enter the market. But the point could be two and three and a peak at the third turn of the trend would not only go on a global direction, but also set the lateral direction of the trend. Foresee such a possibility, it would be very difficult. Three-point minimum price rollback a short-term trends on the global trend and the point of fracture, after which the direction of the trend is changing radically, before taking the previous direction that was set a global trend. Each of these points has a very great interest to our study, because these points and will be our goal at the entrance to the market.

First of all, I would like to draw your attention to the risk of financial transactions by the transaction at the opening of the warrants, at the time of maximum or minimum recoil.

By looking at Figure 3:

Figure 3 year schedule for 2002 -2004, EURUSD number change trend direction for a given period of time.

Drawing attention to the figure, we can safely assume that the probability of the observed trends you turn around once every five months. This may suggest that the trend may change as in the opposite direction, and define the lateral movement, which in turn reduces the chance of determining the qualitative trend in the number of times. Now suppose a high risk of finding such a maximum or minimum in the spread pattern. But our task is not to talk to you about the immediate risks and that you can not do this, the aim is to show how you can maximize the likelihood of a successful login, using the theory of uncertainty set out by us.

The very name of our theory says much about how to warn you that the process of finding the point of entry is very uncertain, but the probability, so we try to proceed according to the probabilistic assessment in order to increase your chances. Given the previously described method of work in the market and the consequences under probability assessments, we can assume that the main task in finding the maximum or minimum, ie a peak at the entrance to the market is to "further" thinking. That is, in other words, to learn to identify a stable peak spatial reasoning must be set for several months in advance. All this can greatly assist you in determining the direction of the course. Do not think of everything, I suggest to review only in accordance with his vision, as a rule, the one who successfully establishes a maximum price or a minimum when entering the market, he does it in advance. How to anticipating the situation.

The theory of uncertainty:

Trader seeking turnaround trend and the time of entry into the market must rely on their common sense, as a rule, the decisions taken by the entrance to the market much sooner than is determined by the trend. To maximize their chances to be guided by the following factors:

1. Early analysis of the fundamental factors for several weeks in advance, taking into account the previously announced figures. In the case of a strong correction to the global trend played an important role as fundamental factors of the economy of the country, the currency which is traded on the market. Here is a list of important fundamental factors that should be disregarded in the change of the trend. As a general rule, if a significant change of these factors on the market may be of concern.

1. The trade balance deficit.
2. Balance of payments deficit.
3. Indices of inflation: consumer price index and wholesale price index.
4. Gross national product.
5. Unemployment.
6. Data on money supply.
7. Election of the president or parliament.
8. The size of retail sales.
9. Housing.
10. The value of orders.
11. The index of production prices.
12. Performance.
13. Indices of stock.
14. Deposit rates.

The above factors may significantly warn you of an impending change of trend. In the case where the data goes against the fundamental analysis of prices and in the analysis in the future as there is such a phenomenon can be assumed that after some period of time may be counter-trend. In this case it is necessary to proceed to the analysis of a technical nature to identify more specific points to enter the market.

2. In the analysis of technical indicators can be tested any equipment you think. We, in turn, are guided by the following indicators: MACD, RSI, Stochastic, Moving Average. The combination of these indicators at different time periods allows you to easily enter the market and go on without a loss in the event of failure analysis.

3. And, of course, do not forget about money management when investing. That is not immediately invest a large sum in the event of a successful analysis of just gradually invest certain amounts in the market. This will allow you to protect against large losses.

A good trend you!

President and Managing the international hedge fund
AlMaz Hedge Fund Management
Alexander M. Mazurkevich
www.Mazurkevich.Com

Programming in MQL II. Search

Dear readers, in the Forex Magazine 2004 number 6 in the article "Programming in MQL II: Sort method of the bubble, continued" was made a small mistake. Please note that when adding a new variable is_sorted initially it must be attributable to the value "true", not "false". Error permitted only in the description of the code, the code is correct. Thus, the revised proposal will look like this: "Every time, before once again look over and compare the elements of the array, we assign this variable the value true. If we ever change the value of the array, then assign it to false."

In the last issue we examined the sorting method of the bubble (Forex Magazine 2004 number 5 - ? 6, Programming in MQL II: Sort method of the bubble). Now discuss how to find specific information in sorted arrays.

Assume that we have a sorted array, and the challenge: to find in this array is an element which is closest in meaning to a given number (hereinafter we call it "X").

The first thing that comes to mind - this is Classified and all elements of the array to calculate the difference between each of them and the number of "X". The one whose difference will be the smallest in magnitude, and will be the next element of the array to the "X". If in sorted array of the small number of elements (up to 5), this method is quite appropriate, but let's think, how many operations a computer must perform, if the sorted array is composed of 100 elements. We need to do almost the same operations of comparison, the number of elements in the array before the desired number. Thus, in the worst case where the required element of the array is at the end, we need to do a hundred and compare operations. This is a very laborious exercise.

Can I speed up the process of a search of assorted array? So far we have not used the fact that the array is sorted. To speed up the search, it is proposed to use the bisection method - the method of dichotomy.

The method of dichotomy is this: find out how many elements in the sorted array, we compare the number of "X" with the middle element of the array. If the middle element of the array more than the "X" - means all the elements of the array after the middle element of the array is also greater than the number of "X", because we are working with a sorted array. Therefore, we should continue to search for the remainder of the array, located to the middle element. Find out how much of the remainder of the array, we again choose the middle element and compare them with the number "X". So, to find the desired item is only a quarter of the array. Then, the border search narrowed even more - until the eighth part of the array, and so on, until there is an element of the array equal to the number of "X" or until it left the array of two elements, a greater number of "X", and another less.

Fig. 1 shows a reduced space, we find the desired element. Seeking element marked a red dot, the middle of the remaining parts of the array - green tags, discarded part of the array - in gray.

(Fig. 1)

For visibility, we did not put all the elements of the array on the hatch, but if you look at the lower leg and, given that he, at 32 times smaller than the original, contains 2 elements, it is clear that initially, we had an array of about 60 items. As a result of application of the dichotomy, completing only 6 of comparison operations, we were able to complete the search. If the search for direct bust, we would require approximately 30 operations comparison. The gain in the face.

Now we will try to implement this method of searching for MQL II. We will need some time to carry out similar acts, then we will need to design "cycle." Because we did not know how long we will have to perform a search, we take the cycle "while". The rest will become clear from the code and its comments.

In the next article we will learn to practice the method of sorting.

array: values [100] (0);
/ / original array to the left edge
/ / search coincides with the beginning of the array values
var: left (0);
/ / initially the right edge of the array for
/ / search coincides with the end of the array values
var: right (99);
/ / Middle element
var: middle (50);
/ / fill an array of values Fibonacci numbers
var: ix (0);
values [0] = 1;
values [1] = 1;
for ix = 2 to 99 (
values [ix] = values [ix-1] + values [ix-2];
);
/ / will go to the numbers Fibonnachi
/ / near to our "X"
var: X (123);
/ / variable "found" will contain the value "false"
/ / until we can not finish the search
var: found (false);
/ / continue to search until the variable
/ / "Found" not accept the value "true"
while is not found (
/ / calculate the middle of the array to search
/ / if (right - left) / 2 is not an integer, then
/ / should be rounded to the nearest whole
middle = left + round ((right - left) / 2);
/ / if the middle is the right of our element
/ / and the edge of the array to search are not yet two
/ / neighboring elements that ...
if ((values [middle]> X) and (right - left> 1)) then (
/ / ... I am the right end of the array to search
/ /, They are ours, now former, mid -
right = middle;
) Else
/ / otherwise, if the middle is left of our item
/ / and the edge of the array to search are not yet two
/ / neighboring elements that ...
if ((values [middle] 1)) then (
/ / ... Then change the left end of the array to search
/ /, They are ours, now former, mid -
left = middle;
) Else if (values [middle] == X) then (
/ / otherwise the middle of the same value on our part.
/ / this means that we should assign the variable
/ / Found the value "true" and thus stop the search,
/ / out of the cycle, "while"
found = true;
) Else (
/ / border for the search narrowed to the point
/ / and now the neighboring elements - this means
/ / that we should stop looking, out of the cycle, "while"
break;
);
);
/ / however, that the search has not been completed
if is found then (
/ / we got out of the cycle "while" looking for an element of the array
/ / closest to the value of a claim
print ( "Item number" + middle + "with value" + values [middle] + "matches the search");
) Else (
/ / we got out of the cycle "while" due to the fact that
/ / border for the search narrowed to the point that
/ / become neighboring elements - this means
/ / we should still compare the desired element
/ / in the subject to which the remaining elements
/ / close it
if ((values [right] - X) - (X - values [left])> 0) then (
print ( "Item number" + left + "with value" + values [left] + "closest to the required");
) Else if ((values [right] - X) - (X - values [left]) <0) then (print ( "Item number" + right + "with value" + values [right] + "closest to the Motion "); ) Else (print ( "Iskomyoe number is located exactly between the element with the number" + left + "with value" + values [left] + "and the element with the number" + right + "with value" + values [right]); ) )

Alexander Ivanov (AKA HORN)

SCHOOL BEGINNINGS trader. Lecture 4

SCHOOL BEGINNINGS Trader
Lecture 4. Fundamental factors and market analysis

2.1. Introduction to fundamental analysis
The most important and difficult part of the currency dealing is the ability to analyze trends in the market, and consequently predict what factors and how to affect exchange rates. In the movement of prices laid down as quick profit, or otherwise - the possibility of rapid and substantial losses. Therefore, the correct prediction of market movements, assessment of events, as well as the manipulation of rumors and expectations - a necessary part of the broker or dealer and the pledge of his success. There are quite a number of factors that impact on the entire foreign exchange market as a whole and for individual currencies.

There are two basic ways to analyze the situation on the market - a fundamental and technical. The first is assessing the situation from the standpoint of political, economic and financial-credit policy. The second is based on the methods of graphic studies and analysis based on mathematical principles.

As part of fundamental analysis examines the various reports of the Monetary - the financial developments in the world, the phenomenon of political and economic life of both individual countries and the world community as a whole, which may influence the development of the foreign exchange market, the analysis, to a change in exchange rates are may result. Here is important information on the stock exchanges and large-type market-makers, interest rates of central banks, government economic policy, possible changes in the political life of the country, as well as all sorts of rumors and expectations. Fundamental analysis - one of the most difficult parts - and at the same time, one of the key parts of the work in the foreign exchange market. Conduct fundamental analysis is much harder than any other, because the same factors in different contexts is not the same impact on the market, or may become a critical absolutely insignificant. It is necessary to know the mutual communication and mutual influence of two different currencies, reflecting the linkages between the various States, the history of currencies to determine the combined effect of various economic measures and to establish a link between totally unrelated at first glance, the events. In addition to some original and most formal rules, it is most needed experience of working in the foreign exchange market.

Fundamental factors are estimated, usually from two positions:
In terms of impact on the official discount rate;
From the viewpoint of national economy.

2.2. Fundamental factors influencing the market FOREX

In general, fundamental analysis identifies four factors that directly influence the market:
Economic;
Political;
Rumors and expectations;
Force majeure.

Classification of news about the extent to which they expected:

Random and unexpected - usually news of political and natural origin, less economic (political instability in the country, war, natural disasters, etc.);
Planned and expected - usually economic news, less political nature.

The economic effects and its influence on market rates is based on the axiom that any currency is a derivative of the country's economic development and its value can be regulated with the help of certain economic measures.

Economic group influences on the market can be divided into the following components:
Data on the economic development of the country;
Trade negotiations;
Meetings of central banks;
Any change in monetary - credit policy;
Meeting of the G, economic or trade unions;
Statements of heads of central banks, heads of governments, eminent economists on the situation at the market rates, changes in economic policies, economic situation in the country, or their projections;
Intervention;
Adjacent markets;
Speculation.
Let us consider each group in more detail.

2.3. This country's economic development.
The principle effects of this subgroup is based on the axiom that the value of any currency is a derivative of the state of the economy of this country. The stability of the economy determines the interest of foreign investors to invest in it and, consequently, the demand for a currency. They include such key indicators as trade and balance of payments, inflation, unemployment, gross national product, etc.

In the FOREX market to develop a common system of quotations of currencies after the U.S. dollar. Thus, the development of the American economy and the value of U.S. dollar is an important, if not decisive, factor in determining the direction of the market, common to the major currencies. Therefore, the main attention of foreign exchange brokers or dealers sent to the U.S. dollar and his "behavior" that causes some reaction from other currencies. However, this does not diminish the influence of other factors - the policy of national banks, or the influence of related markets, which are described in brief below. Monthly or quarterly in the United States published the main indicators of economic development.

Trade negotiations.
Trade negotiations are an important part of economic policy in any country. In particular, the ratio of import and export provides an important indicator of economic development as the trade deficit. For the U.S. trade deficit is a major problem in the past few years, playing a major role in the fall of U.S. dollar against major European currencies. The result of trade negotiations is an immediate response to the market, sometimes more than significant.

The meetings of central banks.
The main task of central banks is to adjust the domestic economy - as the main task. In addition, the adjustment of the internal and external value of the currency as part of his duties. Therefore, any meeting of the central bank - or more precisely, its working committee - drew attention to the participants in the foreign exchange market. One of the main means of promoting, or, conversely, slowing economic growth, attracting foreign capital, the attractiveness of government bonds, and, as a result, the value of currency is the interest rate.

2.4. Changes in monetary - credit policy.
Such measures are rarely taken to regulate the value of currencies, most central banks or governments prefer other measures the impact on the market. Nevertheless, one example may be the recent package of measures developed by the Government of Japan exclusively for the purpose of reducing the cost of the Japanese yen on the world market (also known as supplementary budget). Its main objective is to reduce the attractiveness of investment in the Japanese economy, stimulating the outflow of Japanese capital abroad, tightening rules on foreign clients who have accounts at Japanese banks, etc.

Only the expectations on this package of measures the Japanese yen had dropped in price by nearly 400 points within two - three days. However, when expectations are not met, the reverse reaction of the market is several times higher than the original cheaper.

Meetings of Seven (G7), trade and economic alliances.
One of the objectives of the G is a regulated world economy and in particular to the specific situation in the world market rates. There is some agreement among the members of the G in this regard - Agreement SVOP. The outcome of the meeting of Group of Eight may be a decision for a joint intervention in the global foreign exchange market by several central banks or other measures to limit or, conversely, to stimulate the growth of the value of a currency. In recent times, such agreements may be even, not only by members - for example, is often manifested in the joint agreement of policies on the market rates between Japan, USA and Germany.

Meetings of trade unions, govern trade relations between countries or policy of the region may also have a strong impact on a particular currency. Appeal against the U.S. and Japan in the WTO (World Trade Organization, established in January 1994 to replace GATT) after the failure of the end of the next round of trade negotiations yen left with virtually no movement by nearly a week. Meetings IIF (international monetary union), giving estimates and assumptions about the current state of the world economy, and distribute credits, does not have a direct impact on the currency, although it may cause some reaction in the market. Rather, in this situation you can count on the determination of long-term development strategy for the market as a whole than on the immediate reaction.

2.5. Statements of Heads of Government, heads of central banks, leading economists about the market situation.

This is one of the factors that, in most cases, which was an immediate response to the market. Speech by the Swiss chapter of the National Bank of Lumera disinterestedness of Switzerland in its own strong currency 29 September 1995 led to a leap in the Swiss franc from 1.1400 to 1.1480 level for several minutes, and further to 1.1580 over the next hour. Another example could be a statement by a prominent economist Bergsteyna, who, along with unexpected numbers, impaired balance of trade dollars and unreasonable expectations about the supplementary budget of Japan, led to a catastrophic collapse yen in less than two days from 97.15 to 104.55 marks, offset by a two-week efforts of the Central Bank of Japan and the U.S. Federal Reserve. Quite often, especially under certain conditions, an address of a person can not only severely affect the behavior of a currency, but also fundamentally change the situation on the market.

If the fundamental news contradict the trend, while its impact on the dynamics of the market may be limited to an hour or several hours. If, however, a fundamental factor confirms the trend, it is his acceleration, followed by a rollback.
The cycle life of the fundamental factors:
Short cycle: no more than one day, for all the unexpected news.
Long cycle: from a few weeks to several years, all factors associated with the overall state of national and world economy (the dynamics of inflation, unemployment and interest rates, etc.).

2.6. The interdependence between different countries is

The dollar zone - the Americas, led by the United States;
sterling area - UK and its former colonies;
yenovaya zone - Asia, led by Japan;
Zone EURO - Western, Central and parts of Eastern Europe led by Germany.

"Buy rumor - sell the facts":
- At the time of occurrence of hearing the main thing - to make a deal quickly because the market begins a new and powerful wave that can form strong trends;
- Traders are interested in listening to its confirmation or refutation. It is important to have quickly "jumping off the train."

2.7. Stock market and its key figures

At the exchange rate impact factors reflecting the state of the economy of the country:
Indicators of economic growth (gross domestic product, industrial production, etc.);
The trade balance, the degree of dependence on external sources of raw materials
The growth of money supply in the domestic market
Inflation and inflationary expectations
The level of interest rates
Solvency of the country and the credibility of the national currency in the world market
Speculation in the foreign exchange market
The development of other sectors of the global financial market, such as the securities market, competing with the foreign exchange market.

Money in a foreign country

Interest rates differential (the difference in interest rates)

In the form of securities: T-bills (treasury securities)

USA - Bonds
UK - Gilts
Germany - Bunds
Japan - JGB

USA - The budget deficit is negative
Japan - the budget deficit positively
This puts Japan in the main bonds USA about 60% of the market.
The Central Bank of Russia puts about 80% of its reserves in bonds USA.

Stock Indices
DJIA-USA
Nikkey - 225 - Japan
FTSE - 100 - UK
CAC - 40 - France
DAX - 30 - Germany
Hang Seng - HK (Hong Kong)

Dow Jones (DJI)
There are 4 of the Dow - Jones.
Industrial Dow - Jones (The Dow Jones Industrial Average - DJIA) - the simple average of the movement of share prices the 30 largest industrial corporations. Industrial Dow - Jones is the oldest and most common among all indicators of the stock market. Its composition is not constant: its components may vary depending on the positions of the largest industrial corporations in the U.S. economy and the market, but in the modern world, such cases are rare. In principle, it had to make up 15 to 20% of the market value of shares traded on the New York Stock Exchange. This index is calculated by adding up the prices of the included stock and dividing this sum for a fixed denominator (which is adjusted by the amount of splitting of shares and dividends in the form of shares, constituting over 10% of the market value of output, as well as replacement components, and mergers and acquisitions. Dow - Jones quoted in points. Recently he appeared on futures contracts in Chicago.

Transport Dow - Jones (The Dow Jones Transportation Average - DJTA) - average rate, which characterizes the movement of stock prices 20 transportation companies (airlines, rail and road companies).
Municipal Dow - Jones (The Dow Jones Utility Average - DJUA) - the average movement of share prices on 15 companies involved in gas and electricity.
Composite Dow - Jones (The Dow Jones Composite Average - DJCA) - an indicator on the base of industrial, transport and utilities Dow - Jones.

Index Standard and pauerz "(S & P)
The index is published independently by Standard & pauerz. It is made in two versions - for shares of 500 corporations and 100 shares of corporations.

S & P - 500 is a market value weighted index of 500 shares of corporations that are represented in it in the following proportions: 400 industrial companies, 20 transportation, 40 utility and 40 financial companies. It includes mainly shares of companies listed on the New York Stock Exchange, but there are also stocks of some companies that are traded on the American Stock Exchange and outside the stock exchange turnover. The index represents approximately 80% of the market value of all issues, listed on the New York Stock Exchange. This index is more complex compared to the Dow - Jones, but it is also more accurate because it represented a larger number of shares and corporate shares of each corporation are weighted by the amount of the value of all shares outstanding in the hands of shareholders. Futures and options thereon traded on the Chicago Mercantile Exchange.

S & P - 100. The index is calculated at about the same again as the index of 500 shares of corporations, but is made up of shares in corporations, for which there is recorded at the Chicago options exchange options. This is mainly industrial corporations.

Index of the New York Stock Exchange (NYSE Index)

This index is a weighted market value index movements in equity prices of all corporations, to register their securities on the New York Stock Exchange, that is, in fact, this figure represents the average price per share for all companies on the New York Stock Exchange, the weighted market value of shares in each corporation (with appropriate adjustments for the factors of the fragmentation of shares, mergers and acquisitions). In contrast, the Dow - Jones, which is expressed in points, the index of NYSE expressed in dollars. Transactions in options on this index are carried out at the New York Stock Exchange. Operations with futures contracts are carried out at the New York Futures Exchange, which is a unit of the New York Stock Exchange.

Indices of the American Stock Exchange (AMEX)

American Stock Exchange publishes two major index that is calculated on a completely different manner.
The main market index of the American Stock Exchange (AMEX Major Market Index) is a simple average of the price movement of 20 leading industrial corporations. He was conceived the American Stock Exchange as a sort of substitute for the industrial index Dow - Jones. Although it is calculated and published by the American Stock Exchange, it consists of shares of corporations listed on the New York Stock Exchange. Remarkably, 15 of which are also components of the industrial index Dow - Jones. Transactions in futures on the index are carried out at the Chicago Stock Exchange trading.

The index of the market value of the American Stock Exchange (AMEX Market Value Index) is calculated on a different basis: it is an indicator, weighted by market value of all issued shares in those corporations that are included in it as components. For the first time it was published in September 1973. It includes, as components of more than 800 issues of shares of securities of corporations of all major industry groups registered on the American Stock Exchange, including, in addition to ordinary shares, American depositary certificates and subscription certificates. From a technical point of view, it is unique by virtue of the fact that in his calculation, it is expected that dividends in the form of cash paid to members of its membership shares, reinvested, and on that basis they will be reflected in the index. Options on the index are traded on the American Stock Exchange.

Postcode off traffic (NASDAQ)

National Association of Securities Dealers calculates a number of indices, representing off-trafficking in general and paper companies of certain branches. The main index is the NASDAQ, which includes as a component stock of about 3500 companies (excluding listed on stock exchanges). This index is an indicator, weighted by market value of its components.
For the first time, it was calculated in February 1971.
Transactions in options and futures on this index are carried out at the Chicago Mercantile Exchange.
The drop in stock index led to the downfall of the currency.

Central banks

CB monitor inflation in the country, the national currency and seek to regulate them with the help of three key interest rates:

1. Discount Rate - Discount rate. The interest rate under which the Central Bank of commercial bank lending.
British rates are quite high, so they have a big interest of foreign investors.

2. Interest rate - Repo rate. Interest rate applicable to the Central Bank transactions with commercial banks and other lenders for the purchase (accounting) of the public treasury obligations. CB thus regulates capital market loan. Fed Funds (rate RepoUSA)

3. Lombard rate - Lombard rate. Interest rate applied by the Central Bank under the pledge of real estate, gold, currency values in issuing loans to commercial banks.

As the interest rates increased business activity and rising inflation. The decline in interest rates leads to a cheaper currency. Raising interest rates leads to a reduction in business activity, reducing inflation and the cost of the national currency. In modern conditions the method of influence on the rate of national currency continues to be the practice of buying and selling by central banks, foreign currency, known as currency intervention.

Central banks:

USA:
FED - Federal Reseve System;
The decision to change the rates adopted FOMC-Federal Open Market Committee, which met every six weeks, two days: Monday and Tuesday.
Chairman of the Board - Alan Greenspan

Germany:
Bundesbank (BBK, Buba) - The Central Bank of Germany
Buba cooncil meeting - meeting Buba - every 2 weeks on Thursdays;
Chairman - Ernst Welteke

Great Britain:
Bank of England - BOE;
Session 1 times per month;
President - Eddie George

Switzerland:
Swiss National Bank (SNB);
The meeting - every Thursday;
President - Hans Meyer

Japan:
Bank of Japan (BOJ);
Meeting 24 hours a day;
Chairman of the Board - Masaru Hayami

EU:
Europian Central Bank (ECB);
Chairman - Jean-Claude Trichet, President of the ECB
Along with central banks in the foreign exchange market operated brokerage firm, who, working with a specific bank, acted as intermediaries between the seller and the buyer's currency. To certain advantages of working through a broker can be anonymous when conducting transactions, continuous process, quotes, and the opportunity to propose their own prices.

In recent decades in the foreign exchange market has changed the nature of trade with the shift in the urgency of changing commerce: had a significant increase in transactions where performance is happening in the future. All this has led, on the one hand, to increased susceptibility of the foreign exchange market to market changes and the significant increase of currency fluctuations, and on the other hand, to increase opportunities for high-performance investment. In many markets, along with the widespread operations of buying and selling of currency transactions received from derivative financial instruments - currency and financial futures and options.

Examples of these exchanges have long been recognized by the world's centers of currency trading can be:
The London International Financial Futures Exchange (London International Financial Futures Exchange - LIFFE),
European option exchange in Amsterdam (European Options Exchange - EOE),
Urgent German Market in Frankfurt (Deutsche Terminboerse - DTB),
The Singapore Exchange (Singapore International Monetary Exchange - SIMEX) (Sydney Futures Exchange - SFE) and
Market immediate trade in Sydney.

Inflation

CPI (Consumer Price Index - CPI) - is the index of retail prices.

The index of producer prices (Producer Price Index - PPI) - this is wholesale price index.

The higher these indices, the more expensive local currency. It is believed the growth of these indices to 3% per year.

Monetary Aggregates:
M1, M2, M3, M4 - MONEY SUPPLY - monetary support.
M1 - cash in circulation, banknotes and coins;
M2 = M1 + funds settlement and current accounts in banks, traveler's checks;
M3 = M2 + time deposits in banks;
M4 = M3 + valuable state papers.
The rapid growth of money supply, both in cash and in non-cash form, has a downward impact on the currency.

Gross Product (Gross Domestic Product - GDP)
The higher the GDP, the better the economy. Optimal change - up to 3% per year if higher - feedback. You must enter a higher bid that would cause the national currency appreciation.
CPI and PPI are considered once a month, M / M.
GDP - quarterly Q / Q and are converted to year Y / Y.

Financial performance (Treasure Statement)
Income and expenses of citizens
Personal Income (Personal Income)
A sense of consumer willingness to spend money man (Consumer Sentiment)
The cost of construction (Construction Spending)
Construction (Hosing Starts)
Appeal for permission (Building Permits)
New home prices (New Houses Sales)
Current prices (Existing Houses Sales).
The unemployment rate (Unemployment Rate) - is considered to be once a month. If you raise the rate of national currency desheveet.
Primary treatment of unemployment (Imital Claims).
Ongoing Treatment (Continuing Claims).
The increase of these indicators leads to a cheaper currency.
Retail (Retail Sales) - better than the turnover, the stronger currency.
Dealer Orders for durable goods (Durable Goods).
All of the above information is on Moscow time, in 16:30 and 18:30 (Reuters, CQG)

JAPAN

Japan's fiscal year ends March 31. By the end of the year, usually to determine the balance transferred a large quantity of foreign currency into yen, which tends to rise in price. Many insurance companies of Japan are the largest players in the market: USD / JPI, USD / DEM, DEM / JPI, CHF / JPI, GBP / JPI. Big problem in Japan is an aging population. Hold on for many years, the interest rate has caused a small shift in the banking sector, but, nevertheless, Japan's banks remain the major world banks. Strengthening of South-east economy in the long term will give a chance to become the main currency of yen for the Asian region.

SWITZERLAND

Switzerland is not going to join the EU, thus stressing its independence. The attraction of CHF remains quite high, it's called "saving the currency." In moments of crisis traders from all over the world automatically buy Swiss francs, resulting in CHF usually much stronger. For example, it was on 11 September 2001, when the world learned of the terrorist attacks in New York.

UK

The availability of high interest rates in England sets the world's great interest of speculators, which affects the economic performance in general. England - a recognized global financial center, the main offices of the largest investment giants are located here in the country operates a very strict legislation governing the financial activities of companies, banks and stock exchanges.

CARLO, FOREXTRADER.RU
SUCCESSFUL SCHOOL Trader
trader_karlo@mail.ru

How can astrology help the speculator

Free trade - not the principle, as a means to an end.
Benjamin Disraeli

Astrology has a rich potential for profitable trading. Let us further investigate the impact of cosmic factors on a simple trader. So, first find out which objects affect the field of human activity related to trade. Our Solar System is located in the plane of the ecliptic - the orbit of the planet are at the heart of the sun and rotate in that plane in one direction. The sun makes the turnover for the year, Jupiter - for 12 years, the Moon - a month. Concerning the point of vernal equinox 12 Zodiac share the ecliptic plane by 30 degrees (not to be confused with the constellations, which are gradually being moved - for 2000 years at a mark!). So out of all 12 Zodiac us closer to the topic - Taurus (symbolized practical, tangible, and even money), and Leo - Sunny sign of the creative

Relative to the ground to build a horoscope is constructed grid homes, move with the rotation of the Earth. Astsendent - the point of sunrise - this is the intersection of the ecliptic to the horizon line, to make one revolution per day, per hour - 15 degrees (half the Zodiac). Astsendent - this is the beginning of the first house, a total of 12, but the length is different (not all at 30 degrees). Each house is responsible for their specific area of human life. We are interested in House II (sobstvennoesostoyanie) and V houses (speculation, stock exchange activity). Because we are interested in the kind of Planets Planets - The Sun, Jupiter (finance major) and Venus (small finance). By the way the Sun - a symbolic Manager V at home and the owner of Leo, and Venus - symbolic Manager II at home and the owner of Taurus.

Let a small total - for the consideration of a successful trade on the stock exchange it is necessary to consider the following Signs of the Zodiac - Taurus and Leo, at home horoscope - II and V, as well as planets - the Sun, Jupiter and Venus. Horoscope birth to the most powerful and harmonious these elements will ensure the highest profitability in the stock trade. This may be an individual trader's horoscope, horoscope as well as the establishment of any association, company, etc.

"Mechanics horoscope" is that the planet "attract" certain events that create character, respectively, strongly calendar (with a lot of aspects) "attract" more. Pull these events from the area, which is responsible for the house in which they are located and the Zodiac, which are. These general provisions, specifically looking at the horoscope, watch manager of II-th and V-second homes, their power and position.

His house is filled with good-II planets - the Sun and Venus in many aspects, there is a harmonious aspect of Jupiter to the Sun, V-manager of the house - Mercury in connection with the Moon - manager II-nd house. Of course, there would be a better trader that move in latitude, so that Jupiter was in the beginning of V-th house and the Sun and Venus would have remained in II-m house. Then Jupiter with three harmonious aspects in the fifth house would ensure him an even greater success in stock trading. Here is his statement of May 2003.

All personal materials are printed with the permission of the holder, kindly provided this example.

Interesting to see that the trader himself stiltorgovli - per month is made only four transactions, and deposit doubled. Judging from the opening position tions, we can assume that the bid was made exclusively at night, but the position is closed only on T / P and S / L. Considering the T / P and S / L indicates that the initial ratio of 2:1. And no wrench in the day. Train! In general, there is what traders think is interested.

Often looking statementy novice traders seen the same trend - is the order of hundreds of transactions per month. Just spread lost 100 x 5 = 500 points! Do not it the reason the majority of losses of deposits?

Bin Laden's Assistant

The dollar rose to a message on the environment in Pakistan, bin Laden's Assistant

The dollar rose against the euro and Swiss franc in New York on reports that the chief assistant to Osama bin Laden's terrorist network Al-Kayed is the aim of fighting the Pakistani armed forces.

Capturing Ayman al-Zhavahiri, 52-year-old Egyptian, may enhance the effectiveness of U.S. anti-terrorism campaign, as it can be in contact with Bin Laden and to know about planned attacks. The armed forces along the Afghan border, fought with more than 400 fighters, which can protect the goal of "high level" as stated by the Pakistani army.

"This is seen as a plus for the administration and for the dollar," said a senior foreign exchange trader "Commerzbank Securities" in New York cuirass Vitney, "If they had caught the main culprit, then the threat would be even reduced."

On Friday, the dollar rose 0.8% to $ 1.2289 against the euro at 17:02 New York time with a level of $ 1.2390 a day earlier, according to prices EBS. Today's increase in weekly decline in the dollar cut to 0.6%. The dollar rose from 1.2574 to 1.2689 francs, showing weekly decline of 1.2%. "The dollar rose on the assumption that Bin Laden was caught, said traders, including the president" Tempest AssetManagement "in Irvine, California, Chris Melendez.
The Japanese currency had the biggest weekly rise in four years to 106.67 yen per dollar, as Japan reduces sales of its currency and its economy is improving.

"Capture Bin Laden Assistant can provide U.S. dollar short-term growth, although concern about possible retaliatory attacks could weaken the currency," said currency strategist from "WestLB AG" in London, Michael Kloitter.

"Great growth"
The dollar has experienced a rise of 15 December following the capture of Saddam Hasseyna, then retreated after the flow of automobile explosion in Baghdad. "If it turns out that they captured Bin Laden's assistant, it will be much political support for President Bush and help to increase confidence in the U.S., supporting the dollar," said currency analyst of the "Royal Bank of Scotland Group Plc." Neil Parker. But "too many" if ", because so much is unknown."

Yesterday, the dollar dropped 1.2% on rumors of the bomb in a tunnel between Britain and France. Last week the dollar fell 1.1% on the day of the Madrid bombings, because traders believed that the attack will cause delays in the campaigns of American President George Bush and his allies in Iraq, as well as serve as a signal that the goal of further terrorist attacks could become the United States.

Honors dollar almost evaporated after the Pakistani army representative said that the national armed forces were fighting against 400 militants. Pakistan's military representative, General Shawkat Sultan has called "speculative" reports Al-Zhavahiri environment.

Sales of the yen "viable"
"Yesterday, was news that the assistant to bin Laden was surrounded, and now it is clear that they were still not captured," said Tim Mazeynk, senior currency strategist in the "Investors Bank & Trust" in Boston, which manages 1.1 trillion. $ investment assets. "Of course, if all goes well and will show his face after his arrest on television, we can see a short-term dollar rally."

Yen has risen, at least at 1.7% this week against all 16 major currencies.

The second in the world economy grew last quarter at the fastest pace in 13 years, as consumer spending and business - have increased investment, encouraging foreign demand for Japanese assets.

Japanese yen sales were viable, and now, when we see that the economy achieves greater success, and shares are rising, weakening demand for the currency through its sales declined, "said Garriett Richmond, who oversees 50mlrd. $ As the head of currency management "JP Morgan Fleming Asset Management" in London, "We can see a mark 105 yen to the dollar in the next few weeks."

Japan's "convenient"
Foreign investors last week were net buyers of Japanese assets in the 12 out of 13 weeks, as figures showed the Tokyo Stock Exchange. Japanese Nikkei 225 gained 7% this year, compared with a 2.6% decline in the Dow Jones index in the U.S. and 1.3% fall in the FTSE 100 index in Britain.

"Japan is convenient to all levels of the currency until it is combined with an increase in the stock market," said chief currency strategist "CommerzbankAG" in London, Nick Parsons. "The fact that Japanese stocks had grown up well, is behind the decision to allow ENE and grow."

Finance Minister Sadakazu Tanigaki said yesterday for the third time this week that Japan is not seeking to weaken its currency, reinforcing speculation that the Ministry of Finance ceased buying dollars through the Bank of Japan.

In doing so, he said on Friday that Japan will sell yen, if the currency does not correspond to economic fundamentals.
Following these comments, yen fell to 107.33 yen per dollar. Deputy Minister of Finance for International Affairs Zambia Mizoguchi said that Japan "if necessary to respond" to "chaotic traffic."

Export earnings
Mizoguchi declined to answer the question "whether Japan sold yen on Friday." According to traders, who deal with the Bank of Japan and wished to remain unidentified, the bank at least once this week to sell its currency.

Sales yen to support the incomes of exporters seeking to end the budget year of the country on 31 March because a stronger yen reduces earnings from exports in terms of local currency. Japan has spent 10.5 trillion. yen ($ 97.9 billion) for two months until 25 February to halt the appreciation of currency.

The wave of selling may have been taken "to prevent a mark of 100 yen per dollar by March 31," said currency strategist from the "Lehman Brothers Holdings Inc." in New York Daniel Tenengozer.

Forex Magazine
based on Bloomberg.com