FOREX OWL - Page 3 of 5 - Forex Owl: The Best Place To Learn Forex

Pretty much everybody knows about currency pairs like the USD/GBP – these are the popular Forex trades that nearly every currency trader dabbles in. But just because it’s popular doesn’t mean that it’s the best, and some of the more underrated currency pairs can actually provide quite a bit of bang for your buck. The GBP/KWD currency pair is a fantastic example.

Trading this currency pair makes complete sense – after all, the two economies are closely linked together, with a substantial portion of trade flowing between the two countries. This particular trade is known for its stability and predictability, which enables traders to generate consistent returns on what is an often-underrated pair. That said, understanding the fundamentals of this currency pair is an important part of being able to take advantage of what it has to offer, and this guide aims to inform you of all the most important points you need to know when trading the GBP/KWD.

As simple as this concept seems, it’s often misunderstood by many newer traders. All currency pairs have a seasonal element to their performance – this is largely tied to the nature of the economies that these currencies depend upon. While you can’t be an expert on every economy, you can look up several decades of historical data relating to these currencies, which will give you a sense of what the long-term trends look like for pairs such as the GBP/KWD.

In many cases, GBP/KWD price dips in March and May are not uncommon, while for the pair to peak in the fall is also, once again, not uncommon. This doesn’t always exactly hold, but it is largely true for most currency pairs, GBP/KWD included. All forex trades have historical charts that you can access; giving you exact rates of change that will help you predict the general trend of a currency in the near-term. These aren’t just for veteran traders – anybody can access them entirely for free. All currency pairs have their own unique seasonal trends, so never fail to do your research before you commit to making a trade

You might have heard some people refer to forex scalping as a form of cheating. It isn’t – but what it happens to be is a very effective way to reduce your overall losses while maximising your overall gains if used correctly. Watching the small price movements of the GBP/KWD throughout the course of a day will position you to make the greatest profit. If you want to take advantage of this, keep three Exponential Moving Average charts near you – this will allow you to fully view every possible forex trade that you can make as well as view relevant technical information for each potential trade. Many of the most profitable traders utilise this technique, and you should too.

Don’t hesitate to take advantage of the GBP/KWD currency pair. Its relative anonymity will soon disappear as more traders become aware of how lucrative it can be, and knowing how to trade it effectively can net you some serious profits over the long term. This guide will provide you with all of the most important facts and tips, but ultimately you are responsible for arming yourself with the knowledge that you need to succeed when trading GBP/KWD.

Spreadbetting, CFD trading and Forex are leveraged. This means they can result in losses exceeding your original deposit. Ensure you understand the risks, seek independent financial advice if necessary. The value of shares and the income from them may go down as well as up. Nothing on this website constitutes a solicitation or recommendation to enter into any security or investment.

Alexander Bowring is a London based writer and a Southampton Solent University Screenwriting graduate. He has worked alongside TV personality and Telegraph feature writer Alison Cork, whilst also having produced content for ITV, This Morning, Canvas8, Who’s Jack, Alison at Home, and Bonallack & Bishop Solicitors. Alexander also has a keen interest in investments.

Forex Trading Guide For GBP/KWD GBP/KWD

currency exchange

Post-Election Rumblings Surrounding USD/CAD

January 19, 2017 adminNo comments

One of the casualties of Donald Trump being elected as the 45^th United States president has been the Canadian Dollar, but will this trend continue? While we wait to find out, we can enjoy the gains on USD/CAD, with the currency pair reaching the kind of levels not seen since February 2016.

There are three good reasons that this decline has happened, and all three are related in some way to Donald Trump and his successful presidential campaign.

Dollar strength

Trump has announced some bold plans to cut taxes and increase spending on just about everything. His plans mean that there will be more borrowing from bond markets and higher interest rates and inflation. In other words, everything is supporting the US dollar. He could theoretically pass all of these plans through Congress, as the Republicans currently control it. In reality, however, these Republicans are against increasing debt. Even so, the markets are taking Trump seriously at least. The Canadian dollar isn’t bucking this particular trend, with that having an effect on the USD/CAD.

Trade deal confusion

One of the vows Trump made was that he would revamp trade negotiations, in particular, the NAFTA agreement held between the US, Canada, and Mexico. Canada (along with the USD/CAD) is reliant on trading with their southern neighbours and exporting to them. Uncertainty surrounding trade relations could hurt the Canadian economy across the parallel 49^th. This damage could happen even if the change itself doesn’t, and even though most of the anger is directed not towards Canada, but towards Mexico.

Oil price instability

The price of crude oil has gone down. Part of this is because of reasons relating to Trump. A stronger dollar will usually bring reduced oil prices along with it, but there’s more to the story than just this. Iran recently announced that they have two new oil fields that are producing oil, but it also looks like OPEC is no closer to putting together a real agreement for its regulation either, which is creating problems, as the Canadian dollar is also weakened by reduced oil prices.

Currency volatility

By the end of November, the USD/CAD was trading at 1.3567, which is the highest that it’s been since February. The next level the currency pair can reach is 1.36535, which would be a swing low from early February. The record is currently 1.40 and it worked well as resistance in the tail end of 2015, meaning that it is also a strong line. If it were to go up to 1.4325 this would be a significant step on the road towards 1.47, which does seem somewhat distant.

There really is no other way to address the situation, as the USD/CAD is bracing itself for a rocky time in a Trump run world. While the post-election result gains are apparent, it’s pretty clear that such does not tell the whole story of what may very well be on the horizon.

USD/CAD

currency exchange, Post-Brexit

USD/JPY poses interesting questions following Trump win

December 15, 2016 adminNo comments

Performance charts seldom lie, with the USD specific option showing you that the plunge in the dollar that was expected to arrive following the victory of Donald Trump did actually happen. The dollar really came back to life after the outcome of the election was, but the dip that occurred is pretty much clear to see. The improvement is because Trump is expected to spend more and increase inflation. The unpredictability of Trump was expected to lead to the stocks and the dollar overreacting and plummeting in the event he won, but the market being on such an upswing following his victory is about as surprising as the victory itself. All the polls were in the favour of Clinton after all.

The sentiment was magnified for the USD/JPY because the moves of the dollar were intensified thanks to strong moves by the yen. During Election Day, as it became more apparent that Trump had a chance of winning, so the dollar did indeed start to plunge. As was also expected the perception of market risk lead to people investing in, and boosting, the safe-haven of the Japanese yen. This drop in the dollar and rise in the yen led to the USD/JPY rate plummeting all the way to 101.00 before it eventually bounced back.

By the time trading opened on the day following the election, there was a reversal in this overreaction and the dollar bounced back and the yen was put under pressure by the appetite for risk following Trump’s win. This led to USD/JPY surging above its 200-day moving average and above major resistance to settling at around 105.50. The dollar was further strengthened and the yen was further weakened just 24 hours later, pushing the USD/JPY even further to the point that it broke out above the key downtrend line that went all the way back to February 2016.

It was expected that the market would be this bullish if Clinton won, but it looks like this outcome was the case with a Trump victory as well. The strength of the dollar was also further enhanced because there was less post-election volatility than usual. It’s also expected that the Federal Reserve are on the verge of raising interest rates. St. Louis Fed President James Bullard said that he foresees a rate hike, although the actual rate will still be pretty low for years to come. With the dollar continuing to gain strength leading to the mid-December Fed meeting, as well as the continuation of optimism in the market, it’s expected that USD/JPY will continue to rise.

The next resistance targets to be broken are the 108.00 and the 111.00 levels. It’s not known if it can reach those highs, but the markets will give it their best shot. Right now all eyes are on the next meeting of the Fed and President-Elect Donald Trump. Given the way that he’s already restored the markets, perhaps some people will be a little less apprehensive about the billionaire sitting in the oval office.

USD/JPY poses interesting questions following Trump win

currency exchange, Forex

Telling A Tale Of Trading The GBP/NZD

November 25, 2016 adminNo comments

Many currency pairings involving the GBP are quite popular with traders around the world, but some combinations are less popular than others. In spite of its stability and spread the GBP/NZD currency pair remains relatively undiscovered when compared to others like the GBP/USD and the GBP/EUR. I decided to take a look at the rhythm of this currency over a period of several weeks, and I have come to the conclusion that this pair represents one of the best possible opportunities to earn great returns. I’ll outline some of the bigger points that I think are relevant to those looking to trade the GBP/NZD.

Like most currency traders, much of my portfolio was concentrated on the GBP/USD and the GBP/EUR currency pair. While these are relatively steady pairs, they’re very commonly traded and there is little new ground to tread here. Most of my positions on these pairs yielded middling returns at best, but after refining my approach I managed to obtain positive returns nine straight months in a row, with my total monthly earnings exceeding £1,000 from a much smaller initial fund.

While this seems rather hard to believe for a lot of traders, this wasn’t quite as hard as some people made it seem, especially since people regard less-traded currency pairs as being too much of a risk. Keeping my trades firmly rooted in the facts, coming out ahead didn’t prove to be too difficult a task. And with my initial success came a determination and drive to do better.

My streak with the GBP/NZD occurred between October and November 2015, which is one of the better times to trade currencies. It’s understandable to be sceptical of my claim, but if you stick to your guns and play your hand smart, you can make it happen again and again. Don’t expect it to be a regular thing, but it will never happen if you don’t try.

I don’t want to give the impression that this is was an easy profit to obtain – I had an earlier losing streak that lasted for several days in a row and cost me several hundred pounds. In spite of my feelings of dejection I pressed on, and after re-assessing my strategy I managed to turn around my losses, even managing a £400 gain in 24 hours. That gain came off of just a £75 initial investment, so it was quite a tidy return. It’s easy to want to give up when things get rough, but even the best traders have rough patches. After that turbulent period, the GBP/NZD is now one of my most consistently positive investments.

That’s my own story surrounding the GBP/NZD currency pair – hopefully, it gives you some insight as to what goes on in a trader’s mind when they commit to something new. Betting on a less well-known currency pair can be a scary thing, but with time and practice, you can make it a very profitable venture. Just make sure you’ve got the funds and the patience to make it work!

GBP/NZD

currency exchange

The Underlying Factors Of GBP/CAD Explained

November 2, 2016 adminNo comments

A lot of currency trades are based upon the USD, but this isn’t always the case. While the health of the United States economy does have a considerable impact upon the rest of the world, it does not single-handedly influence currency values elsewhere. A common non-USD trade is between that of the GBP/CAD. These two economic powerhouses both boast outputs exceeding a trillion pounds, but the internals of these economies varies quite a bit.

In Canada’s case, the price of oil has quite a noticeable impact on the value of the CAD. The oil sand boom has only increased the share of oil production in Canada’s general economy and coupled with its dependence on the United States it is quite prone to sudden upward or downward changes in the status of its currency. Indeed, about 10% of Canada’s economy consists solely of oil extraction, and 97% of Canada’s extracted and refined oil goes to the United States, as well as a considerable portion of its manufactured goods. If you are going to trade the GBP/CAD, keep an especially close eye on the price of oil as well as the health of Canada’s trade sector with the United States.

For Great Britain, its trade with the EU constitutes the bulk of its economic and financial fortune. A substantial portion of its trade and foreign reserves stems from trade with other countries in Europe, given that its still-current membership in the EU affords it an advantage relative to trading with non-EU countries. Any threat or change to this dynamic can have a considerable impact on the value of the GBP/CAD (to say nothing of its value relative to all other currencies).

Indeed, the recent Brexit vote has caused a double-digit drop in the GBP’s value, a decline that it has yet to recover from. Because the financial sector is what Great Britain relies upon more, and being that a substantial degree of this business is done with the mainland, leaving the EU threatens to jeopardise this dynamic. While the Brexit does not suggest a complete cessation of business with Europe, the logistical hurdles introduced by the vote could reduce its level. Much like how the passage of NAFTA resulted in a significant increase in trade between the three North American countries, leaving the EU could have considerably negative effects on Great Britain’s economy in the future, along with being detrimental to the GBP/CAD currency pair.

Naturally, the above factors aren’t the only things to consider. But in the case of the GBP/CAD, both currencies strength is greatly impacted by the health of economies close to them (unlike the USD). Understanding how these currencies are intertwined to the countries close to them will help tremendously in executing effective GBP/CAD currency trades. Canada and Great Britain don’t have a particularly symbiotic relationship, so looking at all of the factors around them rather than between them would be your best bet.

GBP/CAD

Forex

The Warning Signs Surrounding GBP/AUD

October 19, 2016 adminNo comments

Typically, currency pairs will involve two currencies of countries that have well-developed economies and play a significant role on the world stage. Many of these involve either the USD and/or the GBP, and in this case, it’s the GBP/AUD pair that this article will focus on. The focus here is on why both of these currencies will likely down trend long into the future. While it doesn’t mean that you should avoid all forex trades with them, you should maintain a sober outlook in regards to the fundamentals for these currencies.

In the United Kingdom’s case, the Brexit vote is by far the biggest strike against the stability of the GBP. Already, the currency had declined more than 12% by the eve of the historic vote, which represents a staggering loss by historical standards. Against the USD, by the end of September 2016, it was at a 31-year low. Its value against the AUD isn’t much better. While the Brexit may not actually happen should Article 50 not be served, the fact that the vote for it passed means that it will take years to fully restore confidence in the currency, with GBP/AUD taking a hit as a result.

The standpoint and action of the Bank of England are another points to consider. The BoE favours retaining its loose monetary policy (referred to as Quantitative Easing), but some of its members are beginning to baulk at the length of time that its low-interest rates have been maintained. It is the only major central bank that is actively increasing the level of monetary stimulus it is providing to the economy, which is designed to push the value of the GBP even lower.

Within the GBP/AUD pair, Australia faces a problem of a different nature. Its mining boom, largely fueled by demand from China and India, has helped push the Australian economy to new heights – its per-capita income in nominal terms stands as one of the highest in the world. That said, this boom has resulted in Australia becoming dependent on the BRICs economies for its own fortune, a task that has proven to be increasingly difficult in recent years. Of the four, only India is showing an accelerating trend of growth.

In spite of these fundamentals, the Reserve Bank of Australia (RBS) is committed to keeping interests rate elevated, allowing the AUD to stand strong with the GBP/AUD pair. RBA Governor Battelino states that the past trend of inflation resulting from mining booms demands a more restrained monetary policy and that the underlying health of the economy justifies keeping rates higher. The stance of the RBS is that it wants its currency to remain strong, and more interest rate hikes are likely coming. The strength of the AUD is only going to grow.

In regards to how the GBP/AUD appears, the 10-day moving average of the pair is below the 20, 50 and 100-day moving averages of the spread between the two, pointing to a sudden and major change in the relationship between the currencies. This suggests that the trend is likely to continue in the near future, which should inform anybody wanting to trade the GBP/AUD currency pair.

Forex

Top 4 Foreign Currency Exchange Trading Tips

September 22, 2016 adminNo comments

If you have dabbled in foreign currency exchange trading before but have struggled to be successful, don’t worry, as this is not an uncommon occurrence. The world of foreign currency exchange trading can often be a difficult path, with success being hard to come by more often than not. However, when it comes to finding illusive success, help is not too far away, as the below 4 tips can reinvigorate your trading experience.

Tip No.1 – Always have a goal in mind

Foreign currency exchange trading is a long and hard journey. As with any trip, you need to know where your end location is. A set desired level of profit or portfolio size determines this final destination in the world of foreign currency exchange trading. Question your goals from the outset. Do you want to achieve a self-sufficient portfolio that generates a regular turnover? Or do you want to trade sparingly, aiming to reduce risk but maximise short-term profit? If you want to achieve success, you cannot trade aimlessly, so always having a goal for your foreign currency exchange trading habits in the back of your mind is key,

Tip No.2 – Employ the back of a reputable broker

You might be surprised to discover the quantity of traders who are restricted by being backed by a low-quality online broker. With so many different brokers being on the market, the reality is that the quality varies wildly. Some platforms offer a bare bones structure, whereas others an all-inclusive service. Whichever type of platform you sign up for, ensure it is a reputable broker with a well-known name. This should act as a framework to achieving success when it comes to foreign currency exchange trading. Furthermore, reputable brokers more often than not have a comprehensive customer service network, which is vital in the event you encounter unforeseen problems when trading.

Tip No. 3 – Stick by a set mythology

With countless ways to trade foreign currency at hand, you will find that some methods are easier to employ than others. Initially, before you start to trade, you need to commit to a set methodology, one that has long term credentials. Some traders set their trading style based on the fundamentals of a countries economy, whereas others settle on a technical approach. This means analysing charts and statistics. Obviously, these are not the only two methods, with many branches coming off them with slight tweaks and variances. Whichever foreign currency exchange trading methodology you commit too, it must be followed over the long term.

Tip No.4 – Prepare for the long haul

While success is certainly achievable with consistent short-term gains, it is a rare sight when it comes to foreign currency exchange trading. If you commit to trading foreign currency, you must be prepared to hold for the long term, meaning waiting for months instead of days for profit to come around. If you cannot commit to such a long duration, then you should ask whether foreign exchange currency trading is the right investment option for you.

Top 4 foreign currency exchange trading tips

Forex

Foreign Currency Exchange Trading Terminology Explained

September 7, 2016 adminNo comments

After taking your first step into the foreign currency exchange trading world, it can be quite an overwhelming experience. The onslaught of information will come thick and fast from the very first moment, and a majority of it will be hard to understand and digest. Foreign currency exchange trading requires a certain knowledge to master. While each and every trade should be made with comprehensive research, getting the fundamentals right with foreign currency exchange trading only requires a base level of education. In order to take this “next step” for knowledge, take on board the tips in this article.

Currency Pair

The term “currency pair” will be a phrase you encounter often in the world of foreign currency exchange trading. You will understand that the process of trading foreign currency is done by trading one currency for another, hence currencies being showcased in pairs. Consider that you currently hold USD in your investment portfolio, but you want to buy GBP, this trade will be a currency pair of USD/GBP. There are numerous formats for currency pairs, with enough available to satisfy all who want to trade foreign currency, no matter what the scale in mind is.

Spread

If you hear the term spread, it is referring to the difference between the buying and selling price. Most consider this to be where the profit is found in foreign exchange currency trading. Trading currencies require you to watch the spread extremely closely, with the ideal scenario being you holding a higher priced currency for the one you are about to trade for. In this scenario, you will be making money, but if the situation is the other way around, you will see a loss.

Leverage

In the world of foreign currency exchange trading, the term leverage refers to both margins and credit, both being used collectively to make trades. If you trade using leverage, as an investor you can make your money stretch further, however, there is an increased risk associated with it. Select online brokers are able to offer leverage ratios as high as 50:1, meaning a single pound can be worth up to £50 in a trade scenario. However, if a trade begins to unravel, you can find yourself in deep trouble fast.

Stop Loss

Unlike other elements currently able to be used within the world of foreign exchange currency trading, stop loss is able to offer some form of security. As mentioned previously, if leverage is not used properly, significant risks are involved. However, stop loss is a tool used for risk management. The usefulness of this feature at times can be worth its weight in gold, as it can prevent you finding yourself in financial freefall during hard times of trading. When a stop loss is initiated, it automatically enforces a trade if the value of the currency dips below a pre-set level. It is an essential aspect of foreign exchange currency trading, but must be used wisely, as it can deconstruct an effective trading strategy if implemented poorly.

Foreign Currency Exchange Trading Terminology Explained trading terminology explained

Forex

The Basics Of Currency Pairs Explained

August 25, 2016 adminNo comments

Foreign currency exchange trading, otherwise known as forex trading, in theory, is a simple process. In many ways this is true, but it is hard to be successful without a lot of skill and expertise within your arsenal. The skill aspect requires a lot of trial and error, but for expertise, this can be picked up with sufficient research. If you feel the downfall of your foreign currency exchange trading strategy is due to lack of understanding of currency pairs do not worry, as we are here to help. This article will take an in-depth look into currency pairs and will help explain the best to trade and which to avoid.

What currency pairs are classed as ‘majors’?

Currency pairs are either deemed to be ‘minors’ or ‘majors’. For beginners, it is best to only focus on the ‘majors’. This includes pairs such as EUR/USD, GBP/USD, USD/CHF, and USD/JPY. When considering your foreign currency exchange trading portfolio, these major pairings should be the foundation of what you trade around.

What currency pairs rank as most popular?

In terms of popularity, it shouldn’t be a surprise that the ‘majors’ dominate the charts. From a volume perspective, EUR/USD is easily the most popular, consisting of around 70% of total transactions, showing that the world traders have a lot of time for this pairing in particular. However, that doesn’t mean other currency pairs aren’t traded regularly. When you analyse the stats, you will see pairs like GBP/JPY, GBP/USD, and EUR/JPY are also favourites in the foreign currency exchange trading world.

What currency pairs are most liquid?

You should already know that liquidity is essential to success in foreign currency exchange trading. EUR/USD is considered to be the most liquid, mainly due to the high transaction volume. While this is true, you will unlikely find liquidity to be a problem when trading foreign currency. Generally, with the size of the market being so big, it would be rare to not be able to find another trader to complete a trade via.

What currency pairs are the best to trade?

This question in itself is highly subjective, as traders will have their own personal preference. That is just the nature of foreign currency exchange trading. If you really want to determine it for yourself, take a look at the signals, or more specifically, look for sharp growth signals.

When is the best time to trade forex?

Foreign currency exchange trading is a market open 24 hours a day, so it literally never sleeps. The question of when is the best time to trade is highly dependent on your own personal portfolio and what currency pairs you currently own. Furthermore, it is dependent on what currency pairs you will wish to acquire. For example, a UK-based trader would not find it worthwhile to trade substantially in the early hours of the morning, as most of the movement within the GBP will not be happening then.

What currency pairs are classed as ‘majors’?

What currency pairs rank as most popular?

What currency pairs are most liquid?

What currency pairs are the best to trade?

When is the best time to trade forex?

The basics of currency pairs explained

Forex

4 Things That All Top Foreign Currency Exchange Traders Do

August 18, 2016 adminNo comments

When you are carrying out foreign currency exchange trades, it is important that you have the tools and skills needed at hand to succeed. This includes market knowledge, as well as technical trading tools, with each aspect being as important as the last. To help you work towards your dream of foreign currency exchange trading success, here are 5 things that all the top traders do, and you should too.

Tip No. 1 – Use fundamental analysis at every turn

You will need to know what the prices currently are for integral currencies and what they should be looking into the future. To achieve this, you can look at the fundamentals of each currency through the appropriately named fundamental analysis. This basically means there are broad recurring themes that affect the market and if understood, can be used to determine the future performance. If you correctly carry out fundamental analysis, you can set up your own rules for entering and leaving a trade with profits in your crosshairs.

Tip No.2 – Pair strong currencies with weak currencies

Through doing this you can skew your results towards profit while dropping the dead weight currencies that are dragging you down and hampering the progress of your portfolio. However, one thing to consider is that you will be buying a strong currency, while effectively shorting the other. Do not ignore the fact that all currencies have advantages and disadvantages, meaning the situation may change in terms of profit at any moment. Saying that, though, the key for all traders is to pair the strong against the weak, this will result in profits.

Tip No. 3 – What is mathematically best may not always be the right move

When it comes to beginner traders, a delicate and precise approach is adopted within their trading strategies. This is carried out with the belief that this method will eventually lead to multimillion-dollar gains. Unfortunately, the market doesn’t always work like this, and the reason is simple. While mathematics is an essential part of success, it cannot be solely relied on. Other factors can change prices, which means mathematics is not the be all and end all of the foreign currency exchange.

Tip No. 4 – Scale your investments appropriately

Another crucial part of foreign currency trading revolves around scaling your investments correctly. This means trading in the correct way to reduce the risks that you are facing. If you do not do this, you will be exposing yourself to events that you could otherwise be avoiding. Remember, foreign currency exchange trading without scale will lead to uneven investments and eventual losses.

These tips may seem like common sense, but it is important to stick to such advice when you are looking into foreign currency exchange trading. When it comes to this market, the details are where you win or lose large sums of money. Professional traders already understand these core aspects and there is certainly a reason for why that is the case.

4 Things That All Top Foreign Currency Exchange Traders Do