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Trading EUR/USD With The USD Dollar Index

April 6, 2011 By pkdeposi Leave a Comment

Article by Ahmad Hassam

What is your market sentiment on the US Dollar (USD)? Is it gaining strength or getting weak? US Dollar Index measures the strength of USD against a basket of currencies. This basket of currencies comprises the EURO (57.6%), Japanese Yen (13.6%), British Pound (11.9%), Canadian Dollar (9.1%), Swedish Krona (4.2%) and Swiss Franc (3.6%).

US Dollar Index symbol is $ DXY and is popularly known as the Dixie. US Dollar Index Futures contracts get traded on the ICE Futures Exchange formerly the New York Board of Trade (NYBOT). One thing you must have observed is that this index is heavily weighted against the EURO. This is due to the fact that before the EURO inception, this index contained the French Franc, the German Mark, Italian Lira and other European currencies. But when EURO came into existence as the single currency of the EMU in 1999, it replaced all the above currencies. Hence, the heavy tilt against this single currency.

How can you use USDX in forex trading? Pro traders use USDX in diversifying their spot USD trades. Now, as said above, USDX is heavily tilted in favor of the EURO more than 50%. It is often used to trade EUR/USD. Both the EUR/USD and the USDX move in opposite direction. When EUR/USD rises, USDX falls. You should know this fact.

How to use the USDX in confirming a EUR/USD trade setup? Suppose, EUR/USD pair is hitting support on the 4 hour chart! You check the USDX 4 hour chart, it should be hitting resistance. Both the charts move in opposite direction. You check on the daily chart, EUR/USD is in an uptrend. This is a good trade confirmation that you can go long on EUR/USD.

Now, we take a situation where just by looking at the USDX chart we know that it is not a good time to trade EUR/USD. Suppose, EUR/USD has been trending for a long time and is on the verge of a breakout! You find a the head and shoulder pattern forming nicely. This means that market has reached its top and a downtrend will soon develop or will it. You need a confirmation.

You check your observation on EUR/USD chart by taking a look at the USDX weekly chart. USDX is also showing an uptrend with a head and shoulder formed meaning a new trend in the down direction. When USDX moves down, it means the market is bearish on USD.

EUR/USD chart indicates a bullish USD while US Dollar Index Chart indicates a bearish USD. Both these observations are contradicting each other. Don’t enter into a EUR/USD short trade. This is how you can use the US Dollar Index in trading EUR/USD pair. Good Luck!

About the Author

Mr. Ahmad Hassam has done Masters from Harvard University. Learn this powerful Fibonacci Retracement method FREE that pulls 500+ pips per trade! Get these 3 Swing Trading Systems FREE.

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USD BOT Best Review

April 6, 2011 By pkdeposi Leave a Comment

Article by Aeron Z.

USDBOT Robot Reviews:USDBOT Robot was made by Mark L. Trenton, an avid Fx dealer. Mark-Trenton has developed an assortment of Fx selling systems over years. Through the years, Mark-Trenton realized how important a role emotion played in going winning in this trading market – as fear and some greed are the superior reasons why individuals lose all thing.His goal was to develop an Expert Advisor automated system that would be totally automatic to rid of the emotional agent in FX Trading. Mark-Trenton states that USD BOT is the most precocious EA he has ever made as it betters on each of his recent products. You simply set up it and turn it on. Every subject is automatic for you offering professional and fundamental money control guidelines.USD BOT Features:1- It is not fully automated system.2- Very easy to utilize.3- USDBOT Expert Advisor is based on a really strong/complicated trading system and generates very accurate buy/sell orders for clients. 4- USD BOT trade mainly EUR/USD & USD/JPY.5- USDBOT Robot trade on Each time frames.6- The USDBOT EA signals are not based on hedging method.7- USDBOT Robot goes with any account size.8- USDBOT EA have a stop-loss, with fixed amount that may be modified manually by users. you may apply the defaults stop-loss or use another stop loss level (example: based on support and resistance).9- USD BOT can be used with any other fx trading software.10- You don’t require to have any fx trading experience to use USDBOT Robot.11- comes with a guide and some videos on how to set up it properly (you will go obtaining the exact same setup that they apply to generate the results posted in the live operation record).There are several owns that Forex Ea trading software package should handle. In this USDBOT Expert Advisor review I will explain the superior USD BOT’s powers:1. Situated on trading conditions, can you simple qualify the automated system?Mark-Trenton believes that you should not be able to modify the automated robot settings as you will take decisions Established on emotion. Thus, his expert advisor is totally-automated and unable to be customised, for your trade protection sure.2. What One Picked Up By purchasing of USD BOT?With becoming a member of this internet site, I have reached approach to superior premium developing materials (PDF guides and step by step instructional videos) along with the installing programme for the automated system. Before you take decision to buy whatsoever forex software, I’m for sure that you may need to explore the potential income and returns you will get with it and equate it against the investing capital you require to produce.3. Is the USDBOT Robot-support first-class?If you experience some enquiries, no matter the way big or little, there should go some form of client servicing easy to you. With your purchase of USD BOT, you get a Fx developing manual that should respond almost all of your doubts. If you still have inquiries, USD BOT offers e-mail support with a ensured, in-person respond within 2 business days.4. Is USDBOT EA Valued Investment In?Even though I would state that USDBOT Robot does costed quite a amount of money to invest it, I’m real happy that I established this investment because it’s paid off many times for me instantly. Even So, I must warn every customers that they must 1st figure the way the USD BOT functions and the way to control it before real cash is ran a risk. The user may however hold an influence on its profitability as the trader gains the ability to give changes to the automated system’s settings consequently.5. If you’re not happy, may you make a repay?This USD BOT sells for 149 Dollar and provides a 56 day, 100 percentage money-back guarantee. Even if you simply function demo account and never give a real account, it announces that you are sitting titled to a repay.Conclusion of This USDBOT Review:I made my greatest in this USDBOT reviews and what I will state is that On the surface, USDBOT seems not only to be fairly priced, but a honored forex software as well.

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Specialize In Trading USD (Part I)

April 6, 2011 By pkdeposi Leave a Comment

Article by Ahmad Hassam

If you are a currency trader and focus on the four major currency pairs EUR/USD, GBP/USD, USD/CHF and USD/JPY, then you should consider yourself a specialist in USD. Yes, its true! You are a specialist in trading the greenback.

Each currency pair actually consists of two currencies. So if you take a long position in GBP/USD then you are in fact buying British Pound and selling US Dollar. In each of the four major currency pairs, US Dollar is one currency of each pair.

This means that you should study and understand the fundamentals that drive the US Dollar and the US economy. You should also understand the workings of the Federal Reserve System (FED). Then you have done your homework. Now you can trade any one of the four major currency pairs as all of them depend on USD.

These four major currency pairs are the most liquid pairs in the forex markets. They involve the vast majority of the currency trading. You should think like this. Majors are the most heavily traded pairs and US Dollar is half of each major pair. So if you can understand what drives the USD, it will have a huge impact on your trading plans.

The only thing you need to determine is your bias for USD. What do you think; USD will weaken or strengthen in the near and medium term. Then apply that bias to the major currency pairs.

Just to remind you when you buy a currency pair, you are buying the first currency in the pair and selling the second currency. Suppose your form a bias that US Dollar is going to become stronger. With this bias, you can go long either on USD/CHF or USD/JPY. Similarly, you can go short either on GBP/USD or EUR/USD.

With one bias, you have the potential of entering into four possible trades. However, each currency pair will react differently to US Dollar strengthening or weakening. Suppose Euro is also strengthening. Both Euro and US Dollar are strengthening at the same time. The currency pair EUR/USD will move less. USD/JPY will move more if JPY is weakening and USD is strengthening.

Lets say you can only afford to trade one standard lot. You have a bearish bias for USD. You can consider going long on either GBP/USD or EUR/USD. What pair you should trade? Which one!

Take a look at both GBP and the Euro. Try to find which of the two currencies is stronger right now. Trade the stronger currency. Take a look at the cross EUR/GBP. If it is down, it means EUR is weakening and GBP is strengthening. Trade GBP/USD!

You should always include an evaluation of the currency correlations for the major currency pairs in every trading plan that you create. The correlations between the currency pairs are dynamic and can change any time. So you need to calculate the correlations at least on weekly basis to give you a fair idea. Correlation is determined by what is known as the correlation coefficient. Correlation coefficient always ranges between +1 and -1.

About the Author

Mr. Ahmad Hassam has done Masters from Harvard University. Find the best Forex Robot. Watch the video as this robot turns ,000 into ,715 in just one month. Try this cash printing Forex Signal Service from heaven.

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