Author Bio

In the last 6 months would you have rather have been a trader or a traditional investor? By traditional I mean being long-only securities. That answer should be easy, as trading would have provided far more opportunities and been far more interesting than the fear that gripped the long-only community.

Let’s quickly look back at how this year started. The 2nd half of 2009 saw risk being rewarded as stocks rebounded from their panic lows. EUR/USD hit a low of 1.24 in March of 2009 and wound up trading above 1.50 late in the year. That optimism carried through as 2010 was underway, providing for more gains in stocks with the Dow Jones trading above 11,200 in April. The currency markets were starting to show some strains in that optimism as EUR/USD would be back trading in the 1.30s in April. This is what I refer to as a gap in the risk correlation. Meaning that EUR/USD was headed one way and stocks another. To me this is a signal; others will say that the correlation is weak. Whether or not this is a signal is for you and ultimately the markets to decide.

The optimism really started to show strains late last year when Dubai had their own debt crisis, but in hindsight that fear was almost laughable as to what was going to happen in Europe. Still, it wasn’t until a seven day span in April that saw both the BP Gulf disaster and Greece debt debacle take center stage. The rest is well-known, as neither hole has been plugged yet.

Fast forward to today and that optimism has been swept to the wayside. There are still a few bulls out there, but their correlation to managing long-only portfolios is usually very high. From Obama’s inability or even lack of interest in creating jobs, to China’s negative economic news post the G-20, to the fiscal austerity measures in Europe, the reasons to be negative right now are rising.

This begs the question, though, is all the negative news already priced in? If you are a contrarian, you have to sense that opportunities are ahead. Usually when everyone is on the same side of the market, the probability of a squeeze rises. Still, if Obama is already in November campaign mode as he continues to blame the prior administration for everything, and Europe and China are no help, then being a contrarian at this point might prove to be a pricy proposition.

Let’s just look at the last 3 years to see what opportunities were in the EUR/USD market. Below is a table showing some typical prices from each month.

The table shows that from 2007 to 2009, there were equal or more opportunities in the 2nd half of the year than there were in the first – and the first half of the year was no laggard for traders!

History does repeat itself (Dow Jones 10k is one example). History has proven that opportunities lie ahead and my guess is that the second half of the year will prove to be just as opportunistic for currency traders as the first half of 2010 was.

This report is for your information only and does not constitute investment or business advice or an offer to buy or sell securities.

=====

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results.

Author Bio

Not everybody can – or would want to – sit in front of a computer all day, so it’s nice to be able to subscribe to a Forex Signal Service and get emails or text messages when trading opportunities arise.  For example, here’s a message I got last week from the SpotEuro Signal Service.  It came about an hour before the Australian Consumer Price Index announcement with a specific direction on the AUD/USD.

I took the short position around 7:30 that night and despite the temptation to reverse myself when things went a little bit the other way, I let the strategy run its course over night and exited the next morning for a tidy profit of over 40 pips.  Alex at SpotEuro would be the first to remind you that not every signal will pan out and not every trade will go your way, but you can see the chart for this one below, and you can befriend me on Currensee and see all my trades.

Earlier in January, I picked up an overnight signal on the USD/CHF – not a pair I usually trade – and even though I got in several hours late, the trade was still good for 57 pips.  Another time, an overnight signal on the USD/CAD turned out to be worth 11 pips while I slept.  Trading while you sleep is a good way to stick with your strategy, but it’s not for the nervous scalpers among us.

It’s important when selecting a signal service to find one that fits your trading style.  If it’s a poor fit – too many or too few trades, too much or too little risk, the wrong trading session – you’ll find yourself second-guessing the signals, which is stressful at best.

If you want to learn more about SpotEuro, you can tune in to tomorrow’s Non-Farm Payrolls Webinar for free, and Currensee members can subscribe to the SpotEuro Signal Service or the new Live! Trading Room and News! Trading Sessions services for as little as 25 Currensee bucks for the first month.

======

Be sure to read the full risk disclosure before trading Forex.  Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results.

Author Bio

A big trend right now in the industry is automated Forex trading of signal providers. Most of the Forex brokers today offer their own proprietary solutions and there are various independent providers like Zulutrade, collective2 and others that offer the ability to automatically execute signals.

I’ve spent some time over the past few months looking at these automated trading solutions and, as a trader I have to tell you, I don’t see how anyone will be able to make money with these platforms, as the lack of transparency and accountability is astonishing. I’ve looked at a few leading signal providers and they trade without stops, keep losing positions open forever and hide poor performing months under different names. Also, the lack of properly presented performance information makes it impossible for the educated investor to reach an informed conclusion that will make him money.

The main problems these platforms have, are that they 1) rely on trading signals that are executed in demo accounts and 2) don’t rely on a specific trader that manages real money. In these scenarios, replicating a signal lacks the most important components of trading, which are money and risk management and trading on a demo account versus a real account. This simulated trading style relieves the trader from worrying about his losing positions as it’s not real money anyway and the market will eventually turn around.

We see a change in this market of traders following with the launch of Covestor’s and Kaching’s new services. Here at Currensee, we’re working on an innovative way to give our members the ability to follow real trades made by real people with real names and real performance using a real Forex trading account. We call it full transparency and are seeding this change and will be the first company to offer such capabilities in the Forex space.

If you are a consistently good trader and you are interested in learning more about how you might participate in this new service, we’d love to hear from you!

=====

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results.